An international conference is probably the best backdrop for cross border cultural exchanges. Earlier this month in an international lawyers’ conference hosted in Delhi, I had the experience of being closely involved, and undergoing the ever evolving exposure to cultural exchanges. Being a panellist on the subject matter in one of the sessions motivated me to share some thoughts on cultural challenges and how transaction lawyers can provide value addition in offline advice and tips to their clients, Indian as well as foreigners, easing the negotiation and integration process in cross-border business relationships.
Most Indian businesses are family- owned and hierarchally structured, and so is the decision making authority, the family being central to the businesses’ growth aspirations and relationships. The major decisions are taken by the patriarch, or the flat matrix at the top, which could include the Harvard educated heir-apparent. There could be a board of independent and/ or professional directors, qualified middle rung officers, but at best such persons can provide a gentle nudge in the right direction. The more conservatives companies have a closed mindset, and for them to open up to in bound acquisitions or embark on foreign investments is a paradigm shift.
So a foreign collaborator has to be mindful, of not just the family flavour, the regional peculiarities and localised customs — in the context the small and medium enterprises, as well as some of the larger conglomerates. There are behavioural patterns that the Indian business persons, in spite of global exposure and education, not to speak of physical relocation — London & Silicon Valley, have not outgrown and it’s worth undertaking a due diligence and sensitisation training for this purpose.
Punctuality is an item about which Indians tend to be lackadaisical — delays in reaching a meeting venue — “The traffic was terrible” or “Sorry, I was in a meeting in the finance ministry” — is not on — particularly if there are too many repetitions.
Adherence to deadlines, instant turnaround and responses may not be in the Indian DNA, but being an adaptable race, many of us have imbibed these workplace practices. And India would not be an outsourcing hub if this had not percolated further downwards.
Indians are not shirkers, nor do they have any issues about weekends being sacrosanct. They will work on Sundays and round the clock, if the exigencies so demand. On the other hand, don’t expect immediate reactions to all suggestions. Indians like to think through overnight and being pushed to sign on a now or never basis may be counter-productive.
The foreign party also has to be mindful of certain sensitivities, for example avoiding dates which involve religious and festive elements — e.g. Holi and Diwali. Don’t push for working on these days unless it’s going to fatally impact the deal — I have known this to be a deal breaker — the Indian party walked away, because they felt the foreign party was too overbearing and this would not improve over time. In comparison to the nineties, with time and exposure, foreigners have become far more sensitised — not just in sending Diwali and Holi greeting cards, but in building relationships which outlast the collaboration on a personal basis.
Indians are formal — they are not very comfortable being addressed by the first name in the first meeting.
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Especially the Patriarch, more so if the person addressing him is much younger. I must say that we are getting conditioned to the first name user, but it is advisable to be more formal in the first meeting out of deference to stature, age, and gender, and this applies to light chitchats during the coffee breaks. Refrain from sexist jokes — this warning is meant for Indians and foreign males across the board, if there is a woman team member present.
Business etiquette with professional women, other than rank misbehaviour issues, is not a problem, Indian women are comfortable with shaking hands, but putting a casual arm around the shoulder should be delayed, till a closer rapport is established.
Women professionals from overseas are treated with respect, but a few things may be kept in mind, such as dressing with decorum.
Western business female formal apparels are a part of our lifestyle — but skin show is best avoided.
Ending on a note for the Indian counterpart, even if you are a teetotaller and a pure vegetarian, it would be gracious if you serve liquor or non-vegetarian dishes when you invite the prospective foreign partner for dinner – it would make the guest feel comfortable and special.
And if the Indian is the acquirer of a business in a foreign jurisdiction — let not the ‘hawan’ be the first thing you do to mark your footprint. Make the people, employees, business contacts, vendors on both sides comfortable — the rest will follow suit.
Kumkum Sen is a partner at Bharucha & Partners Delhi Office and can be reached at kumkum.sen@bharucha.in