Nepotism: Origin, Types, Ethical issues, Impacts, way forward

The unfortunate suicide of Sushant Singh Rajput, a promising and talented actor from Bollywood, brought the issue of nepotism in the public debate. It is alleged that Sushant committed suicide due to rampant nepotism in Bollywood and the inability to handle the unspoken boycott by the big and mighty from the Bollywood industry. The social media, especially, raised its voice against the nepotism in Bollywood and sad end to a very promising career. Nepotism is a concept that engulfs almost all sectors of society. We shall understand its socio-economic origins, its all-pervasive nature, and multiple impacts in this article.

This topic of “Nepotism: Origin, Types, Ethical issues, Impacts, way forward” is important from the perspective of the UPSC IAS Examination, which falls under General Studies Portion.

What is Nepotism?

• Nepotism is an act of favoritism in appointing or giving an opportunity to work in various fields of human endeavor including politics, economics, etc.
• The origin of the term “nepotism” can be traced to the Catholic bishops who would bequeath wealth, property, and priesthood to their nephews. The nephews were usually their illegitimate offspring, and this was a way by which the clergy could own property and retain power within their families.
• Nepotism is as rampant as any other bad facet of the society but due to its covert nature and as almost everybody engages in it, it is never talked about.
• India and other third world countries face the issue of nepotism in every field and it is a major cause and effect of every other issue such as populism, corruption, etc.

Tracing the roots of nepotism

• Nepotism has a social origin. From ages, human species as been ‘nepotistic’ in the sense that it has been passing its socio-economic-political legacy to its next generations.
• Humans try to control the sources of prosperity-may it be movable or immovable property, social status, political power, for the benefit of its kith and kin.
• The divine theory of kingship in ancient and medieval ages was considered ethical and natural. The political power remained in a certain family based on the divine rights notion and the concept of primogeniture.
• The property has been transferred based on inheritance since the birth of institutions of family and kin.
• Profession-wise, there has been a division of labor and functional specialty of families/communities all-over the world.
• In the West, ancient philosophers like Plato talk about three different kinds of men with natural qualities to performs certain tasks.
• In India too, the root of family/community monopoly over a certain craft/business has been since the Post-Vedic period.
• The separation since the beginning of the post-Vedic period further transformed into caste-system which can be termed as a structural nepotism rooted in religious notions of purity and human qualities.
• Technically, the above systems cannot be called nepotism but the ideologies of functional specialty, the ability to gain that specialty and its kith and kin based monopoly was considered natural. The modern form of this social sanction is nepotism.
• The consequent social progress and rising complexity of structures in polity, economy, and social hierarchies, these natural traits claimed and monopolized by powerful sections everywhere.
• By this logic, nepotism is a close relative of monopoly. Nepotism leads to monopoly and monopoly breeds further nepotism.
• Everywhere around the world, the medieval feudal structure was nepotistic where certain families and kin claimed the monopoly over different socio-economic-political functions.
• This societal sanction to the idea of monopoly was challenged by the Renaissance and enlightenment and discarded by the political revolution of democracy.
• The freedom to choose ones’ own destiny without any societal and structural-institutional hindrance and the right to choose are the hallmarks of democracy.
• Here comes the problem with traditional genetic rights and placing family/related members in the positions of common ownership, hence the problem with nepotism.
• Today, democratic societies do not accept nepotism in the fields of common ownership and democratic decision making, political and administrative structures.
• This heightened belief in equality in every aspect is the basis of criticism of nepotism in today’s society.

What are the types of nepotism?

Placing one’s own relatives or the persons with whom one has conflict of interest at positions of power based on personal bias is nepotism. The types are

Political Nepotism

• A politician promoting or placing his/her immediate and extended relatives in political posts.

Administrative nepotism

• A government employee/bureaucrat appointing his acquaintance/relative on government jobs.
• Contractors related to public authorities/representatives of the people getting government contracts.

Nepotism in Economic sectors

• A majority owner of a joint-stock company promoting his son/daughter for ownership/highest decision-making positions.

Entertainment Industries

• In open professional communities like film industries, producers, directors, production companies preferring industry kids over talented and hard-working outsiders.

What is the relation between nepotism and democracy?

• As discussed above, nepotism is at loggerheads with the concept of democracy. In countries all over the world, the disease of nepotism is eating the legitimacy of democratic processes and institutions.
• In the developed democratic countries, political nepotism exists but is very limited. The more developed civic culture there does not allow overt nepotism to thrive and it is defeated democratically.
• But it is of no surprise that at a subtle level, nepotism exists there too through abuse of power, money power, and heightened acceptability of family heritage among people.
• In the third world countries, the political nepotism exists and thrives with every passing election.
• If we look at the former colonial countries in Asia and Africa, nepotism is going on with each passing generation, often through democratic processes.
• There are many reasons for this phenomenon. Some of them are

1. The hegemony of charismatic first-generation leadership which, in most cases, played a huge role in the anti-colonial struggle.
2. The paternalistic nature of government because of extreme poverty and divisions.
3. Continued existence of feudal relations among society.
4. Corporate backing to the ruling dynasties because of their acceptability among the people and winnability in elections.
5. Lack or low level of democratic culture among the citizenry.
6. Vested interest of these dynasties in keeping the citizenry away from political education in democratic values.

How nepotism thrives in society?

• Nepotism thrives through selfish lobbying and syndicates in various sectors of the Society.
• Political nepotism thrives due to the reasons discussed above. Also, there exists an unholy nexus among the different dynastical political parties that help each other to promote their kith and kin.
• Contesting political parties do not field strong candidates against dynasts. This is an unwritten rule of Indian electoral politics. When they do field strong candidates against dynasts, it is because of intensely divisive politics and not because of rejection of nepotism.
• Most of the political parties thrive through the personality cult and glorification leading dynasty. This is more visible in regional parties in India. This lack of intra-party democracy is a boon for nepotism.
• The corporate families create conditions of quid-pro-quo to promote their kith and kin to top positions.
• The attraction of black money through corruption creates lobbies that promote the exchange of favors in the administrative sector.
• The powerful production houses in the film industry that are run traditionally by families of the film industry run their own nexus of nepotism where family relations often trump talent and hard work. Nepotist families get easy chances while the outsiders have to fight really hard, and more often, the struggle goes in vain.
• In an age of cut-throat competition in which every field is devoid of ethics and morality, the trust factor also contributes to decision-making. People tend to trust relatives more than others with their power, money, position, and legacy. Hence the recourse to nepotism. The “Sarpanch-Pati” phenomenon is such an example.

What are the ethical concerns around nepotism?

• The issue of nepotism comes with, among other downfalls, a degradation of the ethics and moral degeneration of society and institutions.
• The more dangerous issue is that nepotism is often left out of ethics codes because it does not seem unethical to the majority of the population. Another reason for leaving nepotism out is that it very so common in every society.
• Nepotism leads to serious harm to the principle of equality of opportunity in every field it is practiced.
• It leads to neglect of fairness as the principle of operation.
• In politics, there is a massive degradation of democracy and legitimacy of the rule of law to produce desired results of redistributive justice.
• The highest form of nepotistic structure is a kind of crony capitalism where dynasties in politics and the corporate world get together to appropriate resources and wealth that should in reality belong to the people in the country.
• In administrative structure, it hampers commitment to the rule of law, disbanding of integrity and impartiality.
• It creates a sense of despair in the victims of the nepotist system in politics, business, entertainment industry.
• The victims have to cope with the extreme stress of competition. They mostly either accept the condition and get adjusted to it or very few cannot sustain the shattering of innocent dreams and take the unfortunate route of suicide as in the case of Sushant Singh Rajput.
• Nepotism is harmful to the system itself, as devoid of quality and character in its flagbearers, the structure cannot sustain itself for long. The dynastic parties become fetters on the new movements and die soon, corporate offices bear losses, administration loses efficiency and art does not satisfy the art-lovers: films don’t do well at the box office and so on.

What are the impacts of nepotism?

• There is a loss of belief in democracy when the political spectrum is full of dynasts. It degrades the democratic system and democracy itself faces legitimacy crises. The result is extremist anti-state movements like Naxalite and Maoist movements.
• Corruption is a big fallout of nepotism. The symbiotic relationship of nepotism and corruption can be seen in the corruption perception index where most of the third-world countries with dynastic politics fare very badly.
• The nepotism also breaks the governance system as the dearth of quality administrators at every stage of hierarchy makes good governance impossible. Quality of human resources is the pre-condition of good governance.
• The economic development of a market dominated country suffers due to nepotism in corporate structures of big and small business houses. The interconnected economic sectors also suffer.
• Nepotism kills entrepreneurial zeal if the majority of investment is directed to create monopolies and nurture nepotism. The thriving startups either cannot sustain the competition or taken over by powerful conglomerates built on nepotism.
• The societal effect of nepotism can be seen in continuing caste and religious hindrances in progress. The relation between nepotism and caste lobbies in organizational structures is very subtle and that is not often discussed extensively.

What cannot be called as nepotism?

• Nepotism is such a common theme and operational behavior that when such a shocking thing happens, there is a tendency of labeling every instance of common interests in addition to close relations is called nepotism.
• But there exists, very thin but it exists, line that separates nepotism from free-spirited cooperation. That line separates competence, talent, and hard work from sheer nepotism.
• An heir of a politician cannot be named nepotist if he fights election and wins it. He then has the blessings of voting citizens through a constitutional method of elections.
• If a board of directors selects through due process the son/daughter of a majority owner to be the next boss of a joint-stock company, it is a just appointment and not an example of nepotism.
• A contractor related to public representative abides by the laid down process and wins the tender, he should not be barred from government contracts just because of his familial standing.
• An artist related to well-known established artists proves his worth in his/her chosen art without damaging anyone’s prospects knowingly or on purpose, it is unjust to call his/her achievements as the product of nepotism.
• In the fields of classical music, dance, drama, sports, often the next generation follows the footsteps of their parents and wishes to make its own mark. There exists an initial advantage of easy access to professional guidance in the form of family or relatives. But whether it is an unfair advantage, answer to this question falls in grey areas of ethical debates.
• But if accidents of birth are no prerequisites for certain privilege then they should also not be the burden of societal perception if they don’t hurt anybody purposefully.

Is it possible to control and eliminate nepotism in every field?

• As discussed above, the thin line between what is and what isn’t nepotism makes it difficult to tackle.
• If the political parties give a semblance of democratic process, it is difficult to gauge the existence of nepotism.
• As far as the state is considered, we can make laws of checks and balances that can be justiciable but in sectors of a highly personal and private form of organization like the film industry, it is not possible.
• Plus, there are a few advantages of this phenomenon like the following ones.
•  Appointing a friend or relative can create a friendly and pleasant working environment. These people may bring many necessary skills to the business.
• The capable nepotists are low hanging fruits. The knowhow of the skills and capabilities of relatives and close friends lets managers assign the right tasks to the right person, based on individual strengths and weaknesses. This brings economy and efficiency in human resources.
• Family members and close friends may have a personal stake and possessing a strong commitment to appointing authorities and their organizations.
• In the political sphere, nepotism increases winnability, so avoiding it by rules and regulations is near impossible as the rules of a political party are designed to get to power mostly.

What are the existing checks to minimize nepotism?

• The preamble says that the people are the sovereign masters of India and it proclaims India to be a republic. This negates dynastic rule.
• The constitution of India gives equality before the law (Article 14) that denies nepotism to exist.
• The democratic elections put ultimate powers in the hand of voters to choose their representatives.
• In administrative recruitments, bureaucracy at all levels is mostly recruited through competitive exams.
• The open and online tender systems are progressively eliminating the nepotistic contract rewards of the past.
• The Companies Act mandates at least one-third of the total number of directors should be independent. This protects investors and shareholders from the concentration of power within the promoter family.

What is the status of nepotism in India?

Let’s look at the data that is collectible i.e. in politics and corporate sector:

• Between 2004 and 2014, a quarter of Indian parliamentarians were dynastic, on average, according to a book edited by Kanchan Chandra.
• In 2019, 30% of all Lok Sabha MPs belong to political families (a record percentage) and they are spread across all the parties, ruling and opposition.

• Among the large states, the following are the states where the proportion of dynasts is recorded above the national average: Rajasthan (32%), Orissa (33%), Telangana (35%), Andhra Pradesh (36%), Tamil Nadu (37%), Karnataka (39%), Maharashtra (42%), Bihar (43%) and Punjab (62%).
• The report in 2015 (by an Indian advisory firm, Institutional Investor Advisory Services (IiAS)) found that 57 companies in the S&P BSE 500 have directors aged less than 35 years, and 75% of these directors belong to the promoter families.
• Almost 66.6% of companies surveyed were family-owned, and around 83% of chairpersons in these companies belonged to the promoter family.
• The Companies Act, 2013 mandated that at least one-third of the total number of directors on the board of any listed company should be independent. Around 17% of S&P BSE 500 companies flout the regulation and appoint less than the requisite number of Independent directors.
• There is a 10-year cap on the tenures of independent directors. If this criterion is considered along with the stipulated number of independent directors, around 54% of companies of the S&P BSE 500 companies emerge non-compliant.
• The companies erode the intent of equality when the majority of them appoint female members of their families to fulfill the condition put by the Securities and Exchange Board of India to have at least one woman in the board of directors.

Way forward

• As can be seen above, despite the constitutional and legal checks, nepotism thrives in formal sectors of India. It is high time that we address the issue.
• Dynastic politics will only end with the proper political education which will instill democratic values in common people.
• There is a possibility of having a stricter law/regulation that gives power to the Election Commission or such other bodies (which can have representation from parties too) to monitor intra-party democracy.
• Institutionalization of election debates like the US presidential election system can also be a solution. It will bring out the real competency of the candidates and negate the hype of the election campaign.
• The administrative nepotism must be tackled with giving the long-pending promotions based on reservations.
• Digitization of administration will eventually eliminate discretion if carried to the logical conclusion.
• The corporate laws must be implemented strictly and penalties may be increased to make them follow the spirit of the law as that of independent directors.
• As far as the entertainment industry is considered, the change must come from within as bringing a law is not desirable. The real change-makers here is the audience. In a world of social media influence, the moral- wallet pressure of the public will make fairness a non-negotiable term in the operation of the entertainment business.

Conclusion

Nepotism is like a termite than eats out the system very slowly but effectively. The suicide of a promising young talent like Sushant Singh Rajput could be a turning point starting a movement against nepotism that is all-pervasive. Fairness and equal opportunity are necessary conditions for a society to thrive and prosper with equitable means. We must put our foot down to end nepotism and clear our society of this major issue so that no life will be ruined by it.

Practice Question for Mains

Explicate the ethical concerns involved in Nepotism. Also enumerate its impacts. (250 words)