Arundhati Bhattacharya: How the veteran banker's enduring legacy continues to inspire India's banks

The word that perfectly describes Arundhati Bhattacharya’s cabin in Salesforce’s Mumbai office is immaculate. There are no piles of papers or pending files on her spotlessly clean white desk. From a potted plant in the corner to a picture on the wall, everything is in the right place. The white walls and the all-around neatness manifest the clarity of purpose of the room’s occupant. This focussed approach has been the hallmark of the former State Bank of India (SBI) chairman, who is now Chairperson & CEO of Salesforce India, the local entity of the San Francisco-headquartered $26.5-billion enterprise software company. Hence, it is no surprise that the jury of the BT-KPMG Best Banks and Fintechs Survey 2021-22 unanimously decided to confer on her the Lifetime Achievement Award.

Bhattacharya took charge of SBI—the country’s largest lender— in 2013 and was the bank’s first (and till date only) woman chairman. Her four-year tenure is remembered for the way she transitioned the 217-year-old state-owned lender into a digitalised enterprise. “It was a very well-entrenched organisation that I took over with everything from the power of the chairman, composition of the committees, to the periodicity of the board meetings [being] well-defined. It was also a legacy organisation that had inherited a lot of stuff that probably was in need of being updated to keep up with the changes,” says Bhattacharya, 66, between sips of tea.

But it wasn’t easy. For example, her efforts at creating a professionally-driven foundation to oversee the spending of 1 per cent of the bank’s profits on CSR were rejected thrice by the Reserve Bank of India for the lack of such a provision in The Banking Regulation Act of 1949. “It was with a lot of effort and persuasion that we ultimately got permission for the foundation,” she says.

The digitalisation goal was further complicated by the fact that communicating to the frontlines was a challenge. As a first step, she held a brainstorming session at engineering-to-IT conglomerate L&T’s Leadership Development Academy in Lonavala, near Mumbai. Thereafter, the entire team of MDs and deputy MDs were flown to Bengaluru. “I requested think tank iSPIRT to curate a sufficient number of fintechs for us to just show the innovations they were working on.” A large number of consultancies were also roped in for brainstorming sessions. The IT committee of SBI’s board was of great help. “It had people who truly understood the evolution of banking. Eventually, everyone rallied behind the idea.”

Bhattacharya’s former colleague Rajnish Kumar, who succeeded her as SBI chairman, nods in agreement. “An ability to build consensus and carry the team along, coupled with a pleasant personality, makes Arundhati a very capable leader,” he says.

With the backing of her team, Bhattacharya set her plans in motion. Her four-year term saw new initiatives such as mobile apps for retail, SME and corporate customers, roll-out of digital-only branches, adoption of AI and robotics to augment credit analysis and risk management, and paring of non-performing assets (NPA) through sales to asset reconstruction companies (ARCs). As for employees, they were given a wide choice of new training programmes and an appraisal system that sought to promote the best performers.

The Early Years

Back in 1977, Bhattacharya had joined a very different SBI as a 22-year-old. The chairman and top management were distant from most employees. “We only knew the regional manager and his group, and once in a blue moon we got to meet the circle management, which is the state management,” she says. Management decisions would be communicated to employees through very large circulars. “Back in those days, we did read them. Today I don’t think people have the patience to do that,” she adds with a chuckle.

Her childhood years spent in the steel townships of Bokaro and Bhilai helped her quickly adapt to the multicultural organisation. “Bokaro and Bhilai were very cosmopolitan for their time. We looked out for each other as everyone was working in the same place. Everyone, from the children of the managing director to [those of] the most junior employee studied in the same class in the project school in Bhilai,” she says.

However, there was a time when she was almost on the verge of quitting SBI. This happened when she was asked to relocate to Lucknow and she wasn’t too sure about finding a good school for her daughter. She consulted one of her mentors, M.S. Verma—a former SBI chairman who went on to head telecom regulator Trai—who famously told her, “It takes only about 30 seconds to let go and resign. Take up the posting and find out if there is a suitable school available in the new city. You have worked hard and are just about beginning to taste success.” Taking his advice, she shifted to Lucknow and was soon able to find the right school for her daughter.

Bhattacharya agrees that she has always been blessed with the right mentors. “Luck did play a part in putting me in the right place at the right time.” Other than Verma, she has also been inspired by anecdotes from the life of another SBI chairman, Raj Kumar Talwar, recounted to her by senior colleagues. Calling him a giant in Indian banking, she remains fascinated by the way he would conduct the business.

Childhood Lessons

She is also known to be an effective communicator and teacher. She credits this to her meeting theatre director Amalendu Chatterjee in the sixth standard. “He taught me how to enunciate so that each word could be understood. The fact that I used to act in plays during every vacation helped me get rid of stage fear.” Right from her school days, she was encouraged by her teachers to take part in debates, which again provided her exposure to public speaking. “I do a far better job impromptu than reading from a script,” she says.

This quality of hers is widely admired by her peers in the industry. “Arundhati’s frank and earthy approach and articulation of issues has always struck a chord with business and banking audiences,” says Romesh Sobti, former MD & CEO of InduInd Bank and last year’s winner of the Lifetime Achievement Award.

Bhattacharya is also a votary of a less-cash society. She says that India’s large cash economy, described by many as a black economy, doesn’t benefit those taking part in it. “That is mainly because several small players, while avoiding taxes, aren’t allowing themselves to build up a credit history that will enable them to leverage more resources to grow their businesses.” In her view, the immediate gratification derived from not parting with taxes doesn’t enable growth.

While she sees a highly collaborative future for the banking industry, Bhattacharya rules out the possibility of lenders turning into tech companies. “At the end of the day, you are a bank. You need to think of the customer and processes. If you become a tech company, then banking will become a secondary activity. And that’s not what you are.” She, therefore, sees banks tying up with technology companies as well as fintechs.

She firmly believes that despite all the challenges that may emerge, SBI will continue to grow in strength. “Unlike the belief that the public sector is stodgy and can’t move fast, there are ways and means of getting these things done. If somebody wants to set a target and a vision, that can happen.”

She is also a strong supporter of giving back to society. “While we were young, it was not told to us in so many words. It was more important to keep our heads above water. Among Generation Z, those who aren’t pressed for financial security, [they] need to practice giving back. It’s difficult to get satisfaction otherwise,” she says. One of the reasons that helped her make up her mind on joining Salesforce after a meeting with Founder Marc Benioff was the company’s focus on philanthropy, particularly its work for the rehabilitation of the homeless in the US.

So, what’s next on the cards for a banker who had once considered a career in journalism? “I regret not getting there [journalism],” she says wistfully. Maybe a new book and submission of a thesis in financial inclusion to fulfil a long-held dream of completing a PhD.

The granite statue of Lord Buddha on the wall behind her table appears to be meditating in silent approval.

@manishpant22a