BENGALURU : It was only the second AGM for Azim Premji. Among the many resolutions before the thirty shareholders who had got together that day in Bombay was one to vote on giving their nod to the appointment of the twenty-three-year-old Premji as the managing director of Western India Vegetable Products. The year was 1968.
The decision of the board, which was headed by Azim’s mother, Gulbanoo Premji, and comprised largely of friends of the Premji family, was approved but not without some drama. This had a lasting impact on the way Premji was to build and run his company, and would eventually make him a poster boy for best corporate practices in India.
One of the young shareholders got up and voiced his concerns against the resolution. The shareholder’s objection stemmed from his reservations about the inexperienced young man, with no knowledge of running a business, being made the managing director of the company.‘Basically, his point was that tumhare jaise nausikhia agar yeh company chaleyga toh is company ka kuch nahi hone wala hai [an inexperienced person like you can’t be entrusted to run the company],’ says Anurag Behar. ‘Now, AHP did not tell me this, but my surmise is that he decided at that moment to prove that person wrong. Wahan se ziddipan aaya [his stubbornness stems from there],’says Behar.
This incident also had another related fallout. Until then, the Premji family owned less than 70 per cent of Western India Vegetable Products. Premji, surprising for a young man who had dropped out of college and had no business training, had so much confidence in his own ability and in that of the company that he made it his single-point agenda in the ensuing decades to never again be dictated to by shareholders. For this reason, he ploughed all the dividend income he received to shore up his ownership in the company to about 84 per cent by 2001. He would have continued to own more shares had it not been for the regulator’s decision to cap promoter ownership in all listed companies to 75 per cent post 2000.
Battling to save his family’s fledgling oil company, Premji learnt early that control was important if he wanted to chart the path of his choice. The young man’s abrupt return to India in August 1966 had not been the script the family had thought of. Only three years earlier, in 1963, when Premji took the flight to San Francisco to pursue an engineering degree from Stanford after his schooling at St Mary’s School in Bombay, Premji’s elder brother, Faroukh M.H. Premji, had joined the board of Western India Vegetable Products while the family patriarch, M.H. Premji, was the chairperson.
Premji had dreams of working in the social sector. But destiny had other plans.11 August 1966 would be a date forever etched in Premji’s mind. He had turned twenty-one less than a month back and was two quarters short of completing his four-year graduate degree programme at Stanford, when on that fateful day he received a call from his mother, informing him about not just a family tragedy but also how that would force him to abandon his plans.
M.H. Premji, fifty-one, had died of a heart attack, and the young boy needed to return home to Bombay to steer the company as per M.H. Premji’s will.Even as he took an Air India flight from San Francisco airport, Premji thought he would be back at Stanford in time to complete his fall semester. For this reason, he did not pack all his belongings and even left some of his clothes in the cupboard in his room.(Excerpted from Azim Premji: The Man Beyond the Billions by Sandeep Khanna and Varun Sood with permission from HarperCollins)