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Achal Raghavan takes an in-depth look at the manner in which various business leaders in the Indian manufacturing and IT sectors coped with the downturn that hit the Indian economy from Q4 2008. Faced with significant threats to sales, profit, and enterprise value, CEOs initiated a slew of coping strategies � such as cost reduction, cash management, operational excellence, people management, and customer portfolio optimization. Implementing these strategies involved facing up to many challenges, both internal and external. With the economy showing signs of recovery, now is the time for corporate leaders to retain the gains made in operational efficiencies, and focus on emerging growth opportunities in the marketplace.

Nowhere is the fast changing nature of the global business landscape more perceptible than on the ethics front. With a spate of recent unethical behaviours by large corporations in the Western world, especially in USA, their societies have become intolerant to businesses that manifest unethical behaviour. Legal and regulatory frameworks in these countries have been swift to respond through stringent laws such as the Sarbanes Oxley Corporate Reform Act. Consequently, most businesses based in these countries have become extremely risk averse on the ethics front. Few of them would like to have anything to do with any unethical company in any part of the world. This changed mindset has significant ramifications for Indian companies that have global aspirations. No Indian company that hopes to globalize in any manner can afford to ignore these changes sweeping the global business arena on the ethics front. Business ethics encompasses much more than mere compliance with laws and regulations. It is about every individual in the organization acting ethically, about creating an ethically sound working environment within the organization and about modeling ethical behaviour by leadership at all levels. Research suggests that it makes good long-term business sense to be ethical. For a company's ethics policy to be successfully implemented, it is essential that: The code of ethics is clearly communicated to employees. Employees are formally trained in it. They are told how to deal with ethical challenges. The code is implemented strongly. The code is contemporary. The company leadership adheres to the highest ethical standards. When an employee gets no clear answers from the organization while dealing with decisions that have inherent ethical dilemmas, he tends to chart his own course of action by drawing on his intuition, conviction, and beliefs, and assessing the pressures of the situation at hand, putting the organization at considerable risk. Globalizing Indian companies essentially have two options. One is to sit back and wait for the tightening of regulatory and societal screws on them, forcing them into ethical behaviour in a reactive mode. The other approach is for them to proactively herald the new era of business ethics by becoming torch bearers of the new order of things. It is in the organization's selfinterest to take a proactive posture on the ethics issue, and be well-prepared for the shape of things to come. We also show how this can be done and what challenges must be addressed for success on this journey.

India has, over the last decade, achieved a position of pre-eminence in many spheres of economic activity, most notably in information technology, business process outsourcing, and various other service industries and also increasingly in manufacturing. At the time when the country was liberalized in the early 90s, nobody thought that such a spectacular performance by the Indian industry would be possible only 15 years later. In fact, during several years immediately following the liberalization of the Indian economy, the common refrain of Indian industrialists to the Government of India was for a ‘level playing field.’ The speed with which the Indian industry has adjusted to these cataclysmic changes in the environment is beyond the wildest expectations of industry watchers and pundits. The Indian industry has, by and large, shown resilience in standing its own ground. Many Indian companies have gone on to take their rightful positions in the world arena. Some of them have even emerged as world leaders in their respective domains. The tide seems to have turned a full circle with many multinational companies (MNCs) with head offices overseas increasingly looking at setting up local operations in India to harness the value that the country delivers.