An ISB Professor Writes: Companies Should Be Audited for How They Treat Their Employees

The debate over toxic workplaces in India revolves around a few false narratives: first, long hours of work are the cause of all the suffering for employees; second, being good and caring with people leads to low productivity; and third, you cannot be good with people and be successful as a company at the same time. Neither evidence nor experience supports these ideas.

Let’s look at long hours first. Take the case of two youngsters trying to prepare for the IIT [Indian Institute of Technology] entrance—a rather tough exam. One may be voluntarily putting in 18 hours of work a day while the other may be complaining beyond six to eight hours of work.

Read: Anxious, Exhausted, Sinking: Why Young Indians Are Struggling at Work

Investigate, and you will find the difference in attitude is explained by factors like agency, autonomy, meaning and an encouraging environment. If the youngster can set her own pace, make her own schedule, see meaning and reward in pursuing admission to an IIT and get timely resources, rewards and feedback, she will be willing to put in long hours.

However, if she is coerced, if all her movements are tightly controlled and she is subjected to empty rhetoric about why IIT is important in the name of motivation—she will burn out in much fewer hours.

A Question of Agency

Managers, CEOs, corporate analysts and commentators must learn from this real-world and much too familiar experience. Entrepreneurs who have complete agency over what they do preach long hours to people who don’t even have small discretions. These employees are often pushed to do what the well-known American anthropologist David Graeber called “bullshit jobs” and don’t get to share a fraction of the rewards that the owner, promoters and founders get.

The root cause of toxicity is not merely long hours, but a lack of agency, autonomy, flexibility and meaning at work. We must broaden our discussion beyond the sensationalism of certain unfortunate events and look deeply at why workplaces have created what Nobel laureate Claudia Goldin calls “greedy jobs” (high-paying-high pressure jobs).

Meaningless Overwork

People dying or burning out due to meaningless overwork has a long history. The problem cannot be solved by crying hoarse over isolated incidents. We must look deeply at why youngsters rightly say: “Work sucks”. The starting point has to be our measure of corporate success.

Organised work as orchestrated by companies has always been measured by a singular yardstick of profitable growth. Occasional talk about “balance scorecards” or the more recent ESG frameworks are still at the margins of what constitutes success for businesses.

Believing that the “business of business is only business” (remember Milton Friedman) has had disastrous consequences. Unless Wall Street and Dalal Street reward companies, boards and CEOs for delivering good people practices, nothing will change. If good accounting and manufacturing practices can be measured and audited, why not people practices?

You want workplaces to be less toxic, ask for a robust audit of people practices, and punish companies who fail in the audit. This is not about some HR [human resources] function using fancy tools. This is about reimagining the accountability of firms to people and society.

The writer is clinical professor (OB), Indian School of Business. Views are personal.