Academic journal article South Asian Journal of Management

Professionalizing Religious Family-Owned Organizations: An Examination of Human Resource Challenges

Academic journal article South Asian Journal of Management

Professionalizing Religious Family-Owned Organizations: An Examination of Human Resource Challenges

Article excerpt

INTRODUCTION

Religion has always had a profound impact on business at many levels, processes and stakeholders (Drakopoulou and Seaman, 1998). Behavioral economists recognize this link and study its impact on different functions like marketing and finance (Minton and Kahle, 2014). This link is evident in studies that showed how different dimensions of religion was connected with entrepreneurship (Hoogendoorn, Rietveld and Stel, 2016) and its impact on stakeholders like consumers (Parameswaran, 2014). Religion has also been studied as a tool to curb unethical practices like earnings management (Du, Jian, Lai, Du and Pei, 2015) and also to enhance the ethical climate of business (Peifer, 2015) because of its emphasis on greater good and pursuit of high values (Stebbins, 1997). Often religion decides the internal sanctioning systems of individuals, and thus help them to create a meaningful and determined relation with organizations.

Religion can be conceptualized in many ways. Often, we may conceive religion as a set of rituals and messages. Messages are universal good ideas that all religions propagate while rituals are mediums through which these messages are dissipated to the masses. Rituals of Daan in Hinduism or Zakat in Islam are in essence giving the message of sharing one's wealth with the less fortunate (Jintranun, Calkins, Sriboonchitta and Chaiboonsri, 2012; and Lala, 2013).

The legal environment in a country also greatly influences the degree of impact that religion can have on any business environment. Paradoxical mechanisms and processes exist: on one hand, it is perceived that religion's impact on business is now declining while others believe that business is governed by yardsticks of religion. In the US, for example, in the case of Burwell vs. Hobby Lobby Stores, Inc. 2014, the Hobby Lobby argument states that "business owners were free to practice religion on their own time, but when they entered the commercial world, faith had to bow to secular law" (Selznick, 2015, p. 1353). Even in India, courts have banned religious activities in government offices ("PIL in Madras HC seeks to ban pujas in govt offices," 2011), but its strong influence continues. However, the same religion can be a major force in shaping how a business operates by imposing certain limits on its functioning. Islamic Finance is one such prime example where Islamic law (Shariah) and investment certificates (Sukuk) are important tenets in the industry (Radzi and Lewis, 2015). Any digression by business entities can lead to a severe loss of reputation, which may take a long time to regain (Jaques, 2015; and Ahmadova, 2016).

Though a secular country, India is very much a deeply religious nation, and religious family-owned organizations are common phenomenon. The influence of religion on these organizations is omnipresent at all levels starting from the vision, mission and philosophy of top management (top management in most cases are the owners in family-owned businesses) passing through work culture, down to procedures and practices. It has been seen to influence the leader's decision making, their attitudes and emotional attachments (Fernando and Jackson, 2006; and Zaharia and Benchea, 2013). Elements such as food served in canteens become concerns for such organizations. For instance, Reliance Retail chain does not offer non-vegetarian products for sale as the religious beliefs of the Ambani family (promoter) and a large section of the shareholders forbid the consumption of meat (Karmali, 2013).

The dynamic business environment and globalization have forced many traditional Indian family firms to upgrade their current management practices to global (secular) standards.

In the academic domain, citation analysis of papers that study religion and business have shown that there exist three streams of research in the area of best practices: "performance issues, religion at work as well as religion, and personal ethics" (Gundolf and Filser, 2013, p. …

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