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Sikh-American Ajaypal Singh Banga Again Named One Of The World’s Top CEOs:
Harvard Business Review
DEBARGHYA SANYAL
MasterCard Chief Executive Ajaypal Singh Banga has maintained his position as the only one among the world’s 100 top CEOs who hails from the subcontinent.
The Sikh-American is featured on the Harvard Business Review’s (HBR’s) ‘Best-Performing CEOs in the World’ report, released on Wednesday, November 11, 2015.
US-based Ajaypal Singh, ranked 74th this year, had also been the only South Asian in the Top 100 list in the 2014 edition of the HBR report.
The list for 2015 was topped by Lars Rabien Sorenson, CEO of Danish pharmaceutical company Novo Nordisk, who replaced Jeff Bezos, founder & CEO of e-commerce giant Amazon.
Bezos, who had stood first in the 2014 HBR list, topped on financial parameters this year, too. But his overall ranking slipped to 87th. His low position, though, could be attributed to a change in HBR’s methodology for compiling the list this time. Rather than considering only the hard stock market numbers -- total shareholder returns and the change in a company’s market capitalisation since its CEO took over -- the research has also looked at companies’ environmental, social, and governance (ESG) performance under the current chair. Bezos’ ESG ranking was a dismal 878th. (CEOs of The Year)
The HBR list features 100 best-performing CEOs and chairpersons of companies across sectors and geographies. Novo Nordisk’s Sorenson was followed on the 2015 list by Cisco Systems’ John Chambers and Inditex’s Pablo Isla. Martin Winterkorn, former CEO of the controversy-ridden automaker Volkswagen, also featured quite high on the list, at number 20. At present, Winterkorn is facing inquiry over his role in the emission scandal surrounding Volkswagen.
The list also brought insights into the profile of those at the corporate peak. Only two of the top 100 were women, while only 26 of the top bosses had a Master of Business Administration (MBA) degree -- Ajaypal was also one of the few who held MBA degrees. Only 19 on the list were also the founders of the company they managed.
A region-wise distribution of the top 100 CEOs showed the US had the largest share -- as many as 41 US-based firms were present on the list. Taiwan, Norway and Netherlands brought up the rear. Among sectors, consumer goods, health care and financial services, with 13 representatives each on the list, had the biggest chunk of CEOs in top 100.
[India had none.]
HBR had compiled the list with the companies that featured in the S&P Global 1200 by the end of 2014. After excluding those who had been at the helm for less than two years and those who had been arrested or convicted of crimes, HBR’s sample came down to 907 CEOs from 896 companies (several companies have co-CEOs) coming from 46 nationalities and running enterprises based in 30 countries.
Each CEO was awarded two sub-rankings -- financial and ESG -- the average of which was used for calculating the overall rank. According to HBR.com, for financial ranking, each CEO’s tenure was evaluated under three parameters -- country-adjusted total shareholder return (including dividends reinvested); industry-adjusted total shareholder return (including dividends reinvested); and change in market capitalisation (adjusted for dividends, share issues, and share repurchases) measured in terms of inflation-adjusted US dollars. Each CEO was ranked for each financial parameter, and the average of these was used for his or her overall financial ranking. HBR sourced environmental, social and governance research and analytics data from Sustainalytics to rate firms’ ESG performance on a scale from 0 to 100. The average of these was used to arrive at an individual’s ESG ranking.
To calculate the final ranking, HBR combined the overall financial ranking and ESG ranking (weighted at 80 per cent and 20 per cent, respectively).
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And … FORTUNE names Ajaypal Singh one of its Business-persons Of The Year 2015 in its annual ranking of corporate chieftains.
Fortune once described companies like Square as harbingers of the new cashless society.
Well, Square may have been the harbinger, but MasterCard is the one cashing in. Under Ajaypal Singh Banga, MasterCard has doubled profits and revenue in five years, and he has been aggressively acquiring companies to build its technological edge.
Says Barclays analyst Darrin Peller: “In the long term it’s going to set them up to succeed technologically. He’s got the energy to get things done faster than his competitors.”
This year Ajaypal Singh signed a 10-year deal that locks in almost all Citi cards as MasterCards and a similar 20-year deal with Itaú Unibanco in Brazil. Shares are up 40% in the past two years as MasterCard swipes its way toward $10 billion in revenue.
[Courtesy: Business Standard, Fortune. Edited for sikhchic.com]
November 13, 2015
Conversation about this article
1: Himal Mukherjee (London, United Kingdom), November 13, 2015, 10:46 AM.
There's a reason why there are no Indians on the World's Top 100 List, or on any other list that has ethics and integrity as one of its criteria: because so many of the Indian CEOs are in jail!
2: Balbir Singh Sodhi (London, United Kingdom), November 13, 2015, 10:04 PM.
Well said, Mr. Mukherjee, citing the reason so for the absence of the Indians from the World's Top CEOs 100 List - so succintintly.
3: Arjan Singh (USA), November 14, 2015, 1:56 AM.
I agree with comment #1 whole heartedly. After working in the US corporate world for more than 10 years I have seen countless Indian origin professionals act in an unethical manner. Not all but many. This article is a wake up call to all professionals in the Sikh community; many decide to shed their turbans and Sikh identity in response to the pressure of blending into the corporate world. What they must realize is that US society is more or less governed by laws, unlike India. Many of these young Sikhs of this next generation have lost confidence or the will to fight for their rights of keeping their Sikh identity. Hopefully, some will learn from Ajaypal's success that one does not have to lose one's stripes to blend in with the herd.
4: Sangat Singh (Kuala Lumpur, Malaysia ), November 14, 2015, 7:22 PM.
"Kaho naanak sab tayree vadiyaee ko-ee naa-o na jaanay mayra" [GGS:383.12] - "Says Nanak, this is all Thy greatness, no one even knows my name." A reminder for all of us to remember the Giver and not just His Gift.
5: Kaala Singh (Punjab), November 14, 2015, 11:54 PM.
Great to see a turbaned role model for Sikhs in the corporate world. This decidedly demolishes the myth that only "clean-shaven" looks help you succeed, it is what is inside of you that helps you succeed.
6: Harman Singh (California, USA), November 17, 2015, 10:29 PM.
It was great meeting S. Ajaypal Singh at a recent leadership conference. A very approachable and inspiring human being ... a wonderful role model for all.