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- [00:04]
Alison Beard
Welcome to HBR on Leadership case studies and conversations with the world's top business and management experts hand selected to help you unlock the best in those around you. I'm HBR Executive Editor Alison Beard, filling in for Hannah Bates. This month we're highlighting some of the best conversations from the 2025 HBR Leadership Summit held in April. In today's episode, we're wrapping up this series with Mahindra Group CEO Aneesh Shah. With businesses spanning automobiles, finance, real estate, agriculture, hospitality, digital renewables and more, Mahindra Group is one of India's largest and most prominent conglomerates. It employs over 260,000 people across more than 100 countries. In this conversation, Shah shares his thoughts on navigating the current political and business environment, maintaining and evolving Mahindra's mission driven culture, and the importance of purpose in driving profitability. He also gives examples of how Mahindra is making a positive impact on communities, from educating children to empowering women to driving productivity in farming. Whether you're a business leader, an aspiring entrepreneur, or simply interested in the world of global corporations, this episode is for you. Here it is.
- [01:14]
Interviewer
So, Aneesh Mahindra was founded in 1945 as a mission driven company. Today, your corporate purpose is driving positive impact, enabling people to rise. How has the company both maintained and evolved that mission as it's expanded into such a large conglomerate?
- [01:31]
Aneesh Shah
So let me start with what happened in 1945. Our founders placed an advertisement in the Times of India to talk about the principles under which the company was founded. It talked about dignity of labor, about caste nor creed nor color coming in the way of a meritocracy, about opposing antisocial trends and about the role of a company in society. Today it would read as an ESG manifesto, but that was the DNA of the group and that has translated to the Rice philosophy that you just outlined. And for us as leaders, we are very conscious of the fact that we are custodians of this culture. It's a culture that is really a very unique one and one that we are very proud of, one that helps us attract and retain talent, and one where we firmly believe that we lead with purpose and profits will follow.
- [02:39]
Interviewer
Can you give me an example of how it drives decision making, for example, in terms of the types of businesses or geographies that you've gotten into?
- [02:49]
Aneesh Shah
So first is a question around how are we changing lives of communities? How are we making them better? And a lot of decisions there may be outside the business realm as well. We focused on educating the girl child, which is a serious need in India for the last 25 years. More recently, we've started on a path to empower women to help skill them, to help them find jobs, to make them financially independent. And our target for both is to get to a million a year. At this point we are a quarter of a million a year and in the next two to three years we hope to reach a million a year. So that's one set of decisions that are outside business in terms of business. It drives a decision as to which businesses should we be in, how should we play. There are certain businesses that we will not enter. It drives our decisions around the people we hire, the cultural fit about how we participate in decision making, the inclusion that we have as part of a culture. And these are all the things that come together to make us who we are.
- [04:02]
Interviewer
As we mentioned a few times on this broadcast already, the dynamics of global trade are changing quickly now with fluid tariff policies from the Trump administration quite unpredictably. So how does Mahindra prepare for and respond to that, keeping both its balance sheet and its purpose in mind across such a wide range of businesses and such a wide range of geographies.
- [04:25]
Aneesh Shah
So the positive part is we have a very, very strong balance sheet right now and performance has been again very strong over many years. So that puts us in very good stead. Second is the impact that we have directly in the global environment today from tariffs is relatively low, but what we see around the world is a tremendous amount of uncertainty. At one point we talked about black swans as being this unique event that happens once in 100 years or so. Today we are seeing a number of unexpected and large events happening around us on fairly regular basis. And through Covid we built the resilience to be agile, to be able to act quickly when something happens. The semiconductor crisis was a very large one for us as an auto company because a number of parts were not available and therefore we had to manufacture without having certain parts ready. Put cars out in large parking lots, bring them back when those parts come back. And all of that has helped us be a lot more agile. So today I would say that we are ready for crisis that we see around us. Yes, some will impact us. At this point we see relatively lower impact from what's happening around.
- [05:44]
Interviewer
In times of geopolitical and economic uncertainty. How does a leader like yourself make smart decisions about things like capital investment? For example, do you find yourself in a holding pattern or is there enough information to move forward in certain. And I think what advice would you give other leaders who are trying to figure out how to operate in this environment.
- [06:06]
Aneesh Shah
So the key is having a very clear view of what is the foundation that we have and what things will work well in a crisis or in a tough environment and what things will get challenged. The next part to that is what is the opportunity that we see? Because typically we would look at a crisis as an opportunity as well, and saying, here are things we're going to do differently, here's something we're going to change internally to be better, and here's something that we're going to potentially acquire externally to take advantage of what's happening around us.
- [06:41]
Interviewer
During your time at Mahindra, how have you seen adherence to purpose benefit the company financially? The title of this is Purpose Driving Profit. So how exactly does it do that? Maybe you can give me some specific examples here too.
- [06:58]
Aneesh Shah
So, Alison, this is a question that many investors have asked us. Profits are important. Why are you talking about purpose? We want a greater focus on profits. Let me first start with outlining the performance that we have delivered for our investors. And I'm going to go back many years because starting 2002 till 2018, we were the best performing stock in the Nifty50, which is India's premier index for a period of 17 years. There were a few challenges after that that we addressed. And then as we look at the last five years, our market cap is up 11 times. So from a delivery of profits and results, we've literally been off the charts. And I would credit a lot of that to what we stand for as a group, what our founders put in place, what our leaders over the years have taken forward and what our leaders today take forward. Because where purpose comes in is create a level of trust and a level of trust that consumers look at us and say, if that's what you're telling us, I believe you. I'm going to therefore be your customer. What our employees tell us in terms of what they want and what they value is very important because we've been able to attract the best talent and in fact retain the best talent as well. And that has a huge impact on our results because it's finally about people and what they do. It's about our stakeholders. Everyone we work with, whether it's a government, whether it is banks, any other stakeholder looks at us and says, if you're Mahindra, we know that you can be trusted, we know what you stand for. And these are all factors that help us outperform in the marketplace.
- [08:53]
Interviewer
So it's attracting better employees, it's earning customer loyalty, it's working with strong suppliers. And the proof is in the pudding in terms of your financial performance. Talking about those stakeholders, those external stakers, specifically suppliers, how do you effectively evaluate whether they're also aligned with your corporate principles? Especially when you're operating in far flung locations, when you might be having to switch quickly from one to another based on shocks like Covid or new trade policies, how do you ensure they are fully aligned with you?
- [09:31]
Aneesh Shah
So first we start with conversations and about what we stand for. In fact, most people will know us and we have a fairly rigorous criteria in terms of who we work with. There is a specific conversation around ensuring that our objectives are similar and that our means of getting the objectives as well are something that are similar and that we talk about. So these are some of the guardrails that help us. And in fact, that's helped us build very strong suppliers over time, very strong dealer relationships over time, some over generations, in fact. And that's where that level of trust gets even further strengthened.
- [10:16]
Interviewer
And you have, you've said that mission is important in terms of sort of what you look for in the talent you hire. How do you ensure that that purpose, that culture is really filtering down to every part of the organization, every level.
- [10:33]
Aneesh Shah
We have to not just talk about it, but our actions every day have to be able to drive that. And that's what people see. We also emphasize that it's important for us as an organization to maintain our values. That's the first thing that we expect from our leaders and from each of our associates. But it's something we have to live every day. It's something that we do in our meetings every day we talk about values. It's about how we react to certain things. And I'll give an example. In our real estate business, there was an issue that came up that we're not getting approvals on time and that there are some others who may be getting approvals in manners that we will not do that. And our response to the business was, you're doing the right thing, stay on track. We may miss numbers, but that's okay. And in fact, even the performance pay for our leaders and our associates across the business was adjusted for the fact that they did not meet the numbers because we didn't want to do the right thing to get certain approvals. So it's about the actions that we take every day that people see and they know that this is the right path to follow.
- [11:47]
Interviewer
As the CEO overseeing such a large organization, you obviously have Talented senior executives running the various business units and in the the various countries. What do you see as your primary responsibilities?
- [12:01]
Aneesh Shah
The primary responsibility I see is first, being a custodian of the culture that we have. And we feel that that is a very important part to our success. The second is talent. Ensuring that we have the best talent, that we're helping groom them, helping meet their aspirations, we're developing them along their careers, giving them different opportunities, empowering them, stretching them beyond their comfort zones. And that's what's creating better leaders for us. Third is clarity of thought in terms of what we do. What we tell all our leaders and associates is do less, think big and execute flawlessly. And that clarity is important in terms of where we play and how we play.
- [12:57]
Interviewer
Do less, think big and execute flawlessly. Tell me a little bit more about each of those things. So particularly do less. That's not something that many employers say to their workers, think big in what way? And then execute flawlessly. How do you ensure that?
- [13:20]
Aneesh Shah
So first is doulas. You're right, that is what everyone wants to do, whether it is for the organization or whether it is for their careers and their particular roles. There is always a tendency of, yes, I can do A and B and C and D. But what we try to emphasize is we've got to look at the outcomes and ensure that we're putting a very sharp focus into something that's meaningful. And therefore, if there's a choice of doing four different things versus doing just one, and if doing one can give us a much better outcome, it's better to focus on that, to put all the energies behind that and create scale. And therefore, as we think about business decisions, we will focus on business areas where we can be a market leader, where we can create scale businesses and try and stay away from businesses that are subscale, that are suboptimal. As we think of leaders in their roles, we want them to develop that clarity in terms of here are the most important things I need to do and here are the most important areas of focus and therefore cut out a number of things. In many cases there is a tendency to say, I want to control more and the more I control, the better leader I am. The mindset we have put in place is it's not about what you control, it's not about the span that you have. The next role that you get will be based on how much value you've added in what you've done. And sometimes you can do that better by doing less and by focusing on certain areas. The second point around think big is again about a mindset in an organization. There's always that fear that if I have put a larger goal, what happens if I fail? What happens if I come in at 90%? Is my performance pay going to be lower? Is my career going to be impacted? And then again, the conversations we have is first, you must believe in the goal that you're putting out there. So we're not going to mandate something for any of our leaders. It has to be realistic. But if you can think bigger, the chances of you doing better are much greater. And it's much better to come in at 90% of a high goal than at 110% of a very low goal. And we try to put in the environment that helps leaders do that by encouraging them, giving them support, having a performance pace, mechanisms where sometimes if you've got a very high goal, you come at 90%, you get the full performance pay as if you hit 100%. By taking away the fear of failure, by enabling second chances for leaders who haven't done well in certain areas, I think that whole environment is important. So therefore we've seen much better results in having more ambitious goals, audacious goals at times, and being able to deliver them. And the third part around executing, is a function of both of these. Because if you've got a very sharp focus, you're doing less, you've got clarity of thought in terms of what you need to do and how you need to do it, and a monitoring mechanism to be able to get there, and talent, of course, a combination of all of these enables very strong execution.
- [16:29]
Interviewer
We do have some audience questions coming in. Maggie and many other listeners would like to know, could you share more information about how you use purpose as a filter for decision making and how purpose informs your innovation processes and new business opportunities?
- [16:48]
Aneesh Shah
So purpose as a filter for decision making. Across every business, we look at what can help the community and what can harm the community. We also look at how are we going to go about that business, what is required, what is the ecosystem like? And based on that, we will make choices of certain businesses, we will play in certain businesses. We will not. There are some businesses in India and I probably can't go through which ones at this point that we do not play in because we don't feel the ecosystem around enables us to play in a manner that we would like to play. There are certain businesses where we feel that the practices that are deployed may not be the friendliest ones for communities around it, and therefore we will not Train those businesses. There are certain where we feel that we should do a lot more because it helps empower communities. Farming in particular is one that we've taken up with our tractor and farm equipment business and we help drive a much greater level of productivity in communities so that it helps them grow. And tractor sales is important, of course, but it's one that follows and these are some of the examples that I'd give in terms of how that drives business decision making.
- [18:11]
Interviewer
So we have a few more follow up questions on that. An anonymous viewer asks how do you ensure that short term profit goals don't compromise with long term purpose?
- [18:21]
Aneesh Shah
I think that's a very tough balance often especially for listed entities. But in that sense I'd say we've been fortunate in some way to have investors who look at us as someone who can create value in the medium and long term and don't worry about the short term as much. Maybe to some extent that's driven by the performance we've delivered and therefore we've earned the right to be able to do that. But in our decision making we are very clear we're here to build a long term business. There will be some short term challenges, there will be some things we will not do. We may miss certain targets because we're not doing certain things, but it is essentially in the context of what makes sense for us longer term.
- [19:06]
Interviewer
Okay. And Char asks, can you share some specific actions that you take to build resilience in your company?
- [19:15]
Aneesh Shah
These specific actions are first around understanding the challenges that exist, understanding the impact that those challenges can have, preparing for them effectively. Scenario planning and what do we need to do in different scenarios and then giving our people the comfort or psychological safety in a sense in a crisis. I think that is the most important part because often when you come into a crisis, that's when you need to build that resilience. And if people know that others are there to help them, it makes it much easier. It gives a much higher level of resilience. And this is where, let me expand further on helping others. This is one metric that we feel is a very important one. And a large number of our leaders and associates have 20% of their KRAs focused on helping others. That has helped build a culture where people are looking out for each other. Initially when we set it up, there was a lot of conversation, what does this mean? How do I get to meets expectations versus exceeds expectations? And we outlined a clear path for them saying that if you can articulate how you helped someone else or helped many others that meets expectations. If others come in and say that you helped them succeed in many ways and you've gone out of your way, that is exceeds expectations. And if you're universally acknowledged as someone that people would go to when they need help, that is super exceeds expectations. So that culture around helping others is one that we found has helped build resilience because people know that in a crisis there are others around who can do rally and help them succeed.
- [21:09]
Interviewer
I absolutely love that. The idea that you're, you're rated on how good you are at collaborating and supporting your colleagues, that's terrific. Kira Bukharan asks, how do you make sure organizational change is proactive versus reactive?
- [21:26]
Aneesh Shah
It starts with having a clear view of what you want to change and why you want to change that. And I'll talk about that in the context of my taking this role because it was a very significant change for the organization. For 75 years, we had three of the members of the Mahindra family as group CEOs and I was the first non family group CEO. And obviously there was a certain amount or maybe more than a certain amount of concern or trepidation in folks saying, is our culture going to change significantly? And therefore we had to be very conscious about how we made that change or that transition. And we used a term continuity in change and we talked a lot about what is not going to change. Here are some of our elements of a culture that will stay constant. This is our DNA. This is our purpose, our philosophy. That is not going to change and here's why it's not going to change. We had to do a lot of work around that in terms of our actions to demonstrate that that is going to stay constant. And we were very specific about here is what's going to change and here's why this change is important. And that level of clarity again around change and the continuity that's required is an important part of being able to navigate that through the organization.
- [22:56]
Interviewer
Great. We have another question about how purpose guides action. Ramakrishnan asks, can you give a recent example where your purpose guided a tough call or strategic pivot?
- [23:11]
Aneesh Shah
So, recent example is we received a call to get into an area to, to manufacture ammunition for certain things. And we basically said, we're not going to play there. We've stayed out of that business. Another example is again back to a real estate business. There were certain opportunities that came up and we looked at those and said that these aren't opportunities that make sense for us overall in terms of our purpose. And therefore we're going to say no. So we will give up business in order to make sure that we stay firm with the purpose.
- [23:47]
Interviewer
Good for you on the ammunition. So, an anonymous viewer, we're getting into some more personal questions now. Not too personal. How has your cross cultural background shaped your personal philosophy?
- [24:01]
Aneesh Shah
It has helped a lot because I've learned a lot from different cultures, from living in the US for 14 years, from running businesses that were global businesses and spending a lot of time in different countries. Because I think it goes down to being able to understand people, to be able to understand what are their aspirations, what are their concerns, what they stand for. And that I found is the biggest value that a leader can bring in terms of being able to understand that, to be able to address that, and in many ways be able to bridge the gap between how different people think. And that in some ways is power of diversity that comes in with teams as well.
- [24:48]
Interviewer
Great. Okay. Another one about you. Solomon asks what books have significantly influenced your thinking either in your personal life or your approach to work?
- [24:58]
Aneesh Shah
So one I would say is PG Wodehouse, which you may not expect as an answer, but I found that, you know, PG Vidas, with the wisdom as well as the humor, has always been a great set of books that I've always gone to. And beyond that, it's been a plethora of books that talk about culture more, that talk about technology, about change in society and how that's going to happen. So that's again, more topical based on where we are at a certain point in time.
- [25:31]
Interviewer
Yeah. Okay. One more audience question. Leonardo asks if you could share some practical actions, I guess maybe first steps that a company can take to start leading with purpose. You know, if you haven't joined a company that was mission driven from the time of its founding, what do you do to move in that direction?
- [25:52]
Aneesh Shah
The starting point is inputs from all the employees because it's really the employees that make up the company that are going to take it where it needs to go. So start with that input gathering in a sense where you understand what everyone wants to do, what are their feelings about how they contribute to community. What I would say in almost all cases you would find is a very strong set of ideas as well as the feeling that people will want to do a lot more for everyone else and use that to be able to craft a clear view around. Here's what we want to do, here's how we're going to do it and get everyone on board to be able to do it. And I think the level of energy that will create will be phenomenal.
- [26:41]
Interviewer
Great. Okay. So now, as a final question from me, we are facing enormous challenges related to socioeconomic inequality, environmental systems sustainability. And, you know, this is especially true in India, your home market. So given the increased divisiveness within and between countries, is it still possible for business and government leaders to come together.
- [27:03]
Alison Beard
To try to solve them?
- [27:04]
Interviewer
How are you using your position as a very prominent Indian business to push forward on some of these big challenges?
- [27:15]
Aneesh Shah
I think it definitely is possible. And there are a number of forums around the world. The World Economic Forum is one example. The Berlin Global Dialogue, the European Business Leaders Council. There are many forums where leaders come together to talk about some of these issues, both government as well as business leaders. And I've seen a very high degree of openness in people to solve some of the problems and to try and get to a much better place in the world. Sometimes we end up doing that, sometimes we don't. But the intent has been very positive. The relationships I've seen across these communities has been very strong as well. So I'm very much an optimistic. I think we will get to a much better world. And I've seen global leaders in both business and government really wanting to work together to create a better world.
- [28:05]
Interviewer
And you think that governments are listening to business leaders right now?
- [28:10]
Aneesh Shah
At least in India they clearly are. I've had a role last year as head of India's largest and oldest industry association. Spent a lot of time with government on a wide range of topics and very high level of listening, sometimes arguing, pushing back understanding. But clearly a government that is listening a lot and wants to make a difference in the world specifically for India.
- [28:37]
Interviewer
Terrific. Well, Aneesh, thank you so much for joining us in your evening. We really appreciate it.
- [28:42]
Aneesh Shah
Thank you.
- [28:47]
Alison Beard
That was Mahindra Group CEO Aneesh Shah in conversation with me at the 2025 HBR Leadership Summit. We'll be back next Wednesday with another handpicked conversation about leadership from Harvard Business Review. If you found this episode helpful, share it with your friends and colleagues and follow our show on Apple Podcasts, Spotify, or wherever you listen. While you're there, be sure to leave us a review. And when you're ready for more podcasts, articles, case studies, books and videos with the world's top business and management experts, find it all@hbr.org this episode was produced by Dave Diulio, Ellie Honen, Kurt Nickish and me. Music by Coma Media. Special thanks to Julia Butler, Scott lapierre, Simona Spirain, Maureen Hoch, Amy Povdak, Alex Kephart, Rob Eckhart, Erica Trucksler, Ramsey Gabaz, Nicole Smith, Anne Bartholomew. And you, our listener. See you next week. It.