Ajay Banga
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Ajay Banga
Another Indian heads US giant
Chidanand Rajghatta | TNN The Times of India
Washington: An entirely India-educated financial pundit climbed a world corporate pinnacle on Monday with MasterCard Inc, the ubiquitous financial company, naming Pune-born, Delhi-educated, IIM-Ahmedabad alum Ajay Banga as its CEO.
Banga will take over the top position from current CEO Robert Selander on July 1, only 10 months after being hired from CitiGroup as a potential successor.
Banga joined MasterCard as president and chief operating officer from Citigroup last August, and was given a $4.2 million signing bonus he could keep if he wasn’t named CEO by June 30, 2010, according to a regulatory filing. Banga will retain his title of president when he becomes CEO. CitiGroup is also led by a CEO of Indian origin, Vikram Pandit, as is PepsiCo (CEO Indra Nooyi), which, like MasterCard, is headquartered in a small town called Purchase in New York. Purchase is also home to J P Morgan, another financial institution with a wealth of Indian talent in its top echelons.
Banga was born in Khadki outside Pune, where his father, an army officer, was posted. He grew up and schooled across India, successively studying in Secunderabad, Jalandhar, Delhi, Hyderabad and Shimla.
He forsook a career in the army that his father was keen he pursue and instead took a BA in Economics Honors from St Stephen’s College, Delhi, and later an MBA from the Indian Institute of Management, Ahmedabad.
In that sense, Banga is an entirely Indiaminted executive who has reached the top of an international company. He started his career at Nestle and joined Citigroup in 1996 as head of marketing in India for the consumer business. Incidentally, his brother M S Banga is the former chairman of Hindustan Unilever Ltd. Banga’s task is to chase down Visa
Washington: Mastercard’s announcement about elevating Ajay Banga, who is a turbaned Sikh, came the same day PM Manmohan Singh is visiting the US for the Nuclear Security Summit in Washington DC. In recent years, the much-admired community from India has made strenous efforts to apprise Americans of their distinctive religion and culture, with even the White House responding by celebrating the birth anniversary of Guru Nanak Dev for the first time last year, a point President Obama conveyed to PM Singh when they met in November.
In 2000, Ajay Banga was promoted to head CitiFinancial and the US consumer assets division. In 2002, he took over the retail bank in North America — his first stint in the US — and in 2005 he was named to head Citigroup’s international consumer-banking and finance businesses.
He moved to Hong Kong in early 2008 after being named to oversee all of the bank’s businesses in Asia, including credit cards and consumer banking, institutional banking, wealth management and alternative investments, before returning to the US last year with MasterCard. Banga’s task ahead is clear — to chase down leader Visa at a time both networks are said to be benefiting from consumers’ increased shift to plastic.
By 2013, card- and electronic-based payments will account for 63% of an estimated $9 trillion in US consumer transactions, according to experts.
World bank
2023 USA chooses Banga as candidate for WB President
Mayur Shetty, February 24, 2023: The Times of India
Mumbai : Ajay Banga, US President Joe Biden’s candidate for the World Bank’s chief, is a pragmatic choice for a role that balances the West’s demand for strident environmental action and the developing world’s aspirations to grow out of poverty.
Banga, as the former head of the second-largest payment company, has sufficient experience in playing the balancing role. He has pushed for Mastercard’s growth in Asia even as he spoke of partnering with regional networks like the National Payments Corporation of India (NPCI) and China’s UnionPay. In India, Banga lobbied with the government as head of the USIndia Business Council and was the senior most payment industry CEO to engage with the government on the issue of local data storage norms. At the same time, he pumped over a billion dollars into India, investing in a payment-processing node and acquiring local processing companies to do business for the world. “If you look at 3%, everyone is a rival. If you look at 97%, everyone is a partner. I look at associations such as NPCI and China UnionPay as partnerships to grow electronic payments,” Banga said in an interview with TOIin 2017. While he was a strong proponent of digitisation, he felt it should be incentivised and not forced. “If you want digitisation — whether it is card, phone or fingerprint — you cannot get that by fiat. You have to encourage and incentivise both thecustomer and the merchant,” Banga had said in the interview just after demonetisation. Banga, who was appointed Mastercard chief soon after the 2008-09 financial crisis, tripled the company’s revenue during his tenure of over a decade, tapping into the surge in online shopping. Like his elder brother, Manvinder Singh ‘Vindi’ Banga, who headed Unilever’s global food home and personal care division, the younger brother cut his teeth in FMCG with Nestle India, where hestarted his career in 1981 and spent several years rising to a senior position. He spent another two years in PepsiCo before moving to Citibank. A graduate in economics from St Stephen’s College Delhi, Banga did his management from IIM-Ahmedabad. He made a lateral shift into banking in 1996 as Citibank’s head of marketing and sales in India. He rose to head of sales, marketing and business development for Europe, the Middle East and Africa, based in Brussels.
Why USA selected Banga
Chidanand Rajghatta, February 24, 2023: The Times of India
WASHINGTON: Whether it is running for the US Presidency or waltzing into the corner-suite of global corporations such as PepsiCo, Microsoft, and Google, the dazzling heights achieved by the Indian diaspora is now the accepted norm. Even so, the nomination by President Biden of former Mastercard CEO Ajay Banga to head the World Bank falls in a different category.
It is a rare exception to the default academic and career template most immigrant CEOs of Indian-origin have: They are born, raised, and have their early education in India, but higher education and early career is invariably in the United States. Indra Nooyi, Satya Nadella, and Sundar Pichai are among those in this category. Indeed, they may have graduated from IITs and IIMs, but the finishing school is typically Stanford, Wharton, Harvard, Yale etc.
Ajaypal Singh Banga in contrast is largely minted in India, a fact that was noted by President Biden, and which may have even helped in his choice. "Raised in India, Ajay has a unique perspective on the opportunities and challenges facing developing countries and how the World Bank can deliver on its ambitious agenda to reduce poverty and expand prosperity,” Biden observed in remarks that were echoed by other analysts and admirers.
M.R.Rangaswami, founder and chairman of Indiaspora, a network of global Indian-origin leaders, calls Banga's nomination an "inspired choice" by President Biden given recent commentary around the Bank’s mission and objectives, including a sharp focus on climate resiliency and environmental sustainability that the former Mastercard honcho is eminently qualified to bring. Sanjeev Joshipura, Indiaspora’s Executive Director, noted that as the first Indian-born nominee to the World Bank Presidency, Banga would bring "a lived understanding of the challenges faced by developing nations.”
Indeed, much of Banga's early career -- after schooling in Secunderabad, Jalandhar, Delhi, and Shimla, the outcome of fauji (army) family -- was shaped in India. After graduating from IIM Ahmedabad, Banga joined Nestle India in 1981, working there for 13 years on a range of assignments spanning sales, marketing, and general management. He then joined Pepsico to launch its fast-food franchises in a liberalizing India, before moving to Citibank in 1996 as the head of marketing in India for the consumer business.
Over the next 13 years he served in a range of positions at Citi, including eventually leading the retail banking and consumer assets division in the US (which first brought him to New York City just before 9/11) and later as head of its Asia-Pacific operation in Hong Kong.
He would have been on track to head Citibank as a protege of then Chairman Sandy Weill ( Vikram Pandit, another Indian-American, was CEO at that time), but Banga quietly peeled off to Mastercard, then a modest 5000-people company (compared to 300,000 at Citi) that was looking to take on market leader Visa. By the time he wrapped up his stint a decade later, he had tripled its annual revenue and become an icon in the industry for his cash bashing and digitization efforts aimed at supplanting currency with card.
It was the kind of track record that led US Treasury Secretary Janet Yellen, who was in Bangalore for the G-20 finance ministers meeting when President Biden announced Banga's nomination, to note that “His efforts have helped bring 500 million unbanked people into the digital economy and deploy private capital into climate solutions.”
Of course, not everyone is chuffed about Biden's choice. Some critics are already sharpening knives calling him a "Wall Street insider" and a "big business executive" without the kind of public sector experience they say the Bank needs. "Banga’s long career at predatory banks and corporations does not inspire confidence that he would transform the World Bank into an institution that can work for people and the planet. On the contrary, it’s sadly ironic that his past work as a Nestlé executive aligns with the World Bank’s damaging history of water privatization,” the group OilChange international said in a statement. But he has the backing of the Biden administration and confirmation is expected to be a formality. Vice President Kamala Harris, who has worked closely with Banga on migration issue in North Central America, said he will be a "transformative" World Bank President who will bring "great insight, energy, and persistence...to address global challenges and promote economic opportunity.”
Humble and self-effacing, Banga's public talks – particularly at schools and colleges he frequents – are inspirational. The story goes that in the days after 9/11 when he was relatively new in NYC, Citibank's Weill had to convince him to take the company jet instead of flying commercial and risking immigration scrutiny. Despite stray attacks on Sikhs in NYC, Banga insisted on walking to work, and Weill would often stop by his apartment building to walk with him to give him cover.
In a 2016 leadership forum, Marc Olivie, president and CEO of Columbus-based W.C. Bradley Co. recalled a business trip with Banga to Turkiye. As they were crossing a street, some men in a vehicle passing by shouted at Banga, calling him a Taliban terrorist.
“Here you are the CEO of one of the largest companies in the world, serving on several committees of the president of the United States. How do you deal with such ignorance and bigotry, and what will it take to change it? he asked.
“You have to shrug it off because you’ve got two options at that time — you can either shrug it off or you can get angry. Angry isn’t going to change it,” said Banga, cheekily adding, “By the way, there were four of them in that car and there was only you and me. I learned as a kid you don’t take on a fight that you can’t win. And I wasn’t sure you were going to fight with me, Marc.”
Such experiences have led Banga to repeatedly emphasize the need for diversity in organizations, best expressed in an oft-cited quote: In nature, you get penalized for not being diverse enough. Being a panda and having bamboo as your only food source quite dramatically increases your chances of becoming extinct. In several forums, he has repeatedly emphasized the importance of leaders surrounding themselves with different people who have had different life and work experiences; to embrace all races and cultures and genders.
“At the end of the day, if you surround yourself with people who look like you, who walk like you and talk like you, and grew up in the same places you did and worked with you in your prior jobs, then you will have a sense of comfort of hiring people around you who have that familiarity. But you will also have the same blind spots. You will miss the same trends. You will miss the same opportunities," he explains.
Evidently, the most diverse administration in American history took the cue and acted upon it.
Why some people opposed Banga
Jennifer A Dlouhy & Eric Martin, Bloomberg, February 24, 2023: The Times of India
Progressive groups that have long advocated for a change in the leadership of the World Bank decried the Biden administration’s nomination of a former Wall Street and corporate executive as more of the same at the anti-poverty lender.
Washington’s selection of former Mastercard chief executive officer Ajay Banga to be the World Bank’s president was being condemned as a forfeited opportunity to tap a candidate with deep public-sector experience combating economic inequality and climate change.
The World Bank needs a leader “who will prioritise the urgency of the climate crisis, not another big business executive,” said Collin Rees, US programme co-manager at Oil Change International, a group that pushes a pivot away from fossil fuels. “Banga’s long career at predatory banks and corporations does not inspire confidence that he would transform the World Bank into an institution that can work for people and the planet.”
To be sure, Banga’s selection drew praise from supporters who said the 63-year-old raised in India brings a different perspective to an institution whose leaders typically have been deeply embedded in the US. US treasury secretary Janet Yellen on February 23 said Banga’s track record “forging partnerships between the public sector, private sector and nonprofits uniquely equips him to help mobilise the private capital and press for the reforms needed to meet our shared ambitions.”
And John Kerry, the US special presidential envoy for climate, hailed Banga as “the right choice,” casting his corporate experience as an asset. Banga has “proven his ability as a manager of large institutions and understands investment and the mobilisation of capital to power the green transition,” Kerry said.
But climate activists and progressive groups said Banga still hews too closely to the typical mould of male World Bank presidents with deep ties to Wall Street and corporate America, including its current head, David Malpass, who previously was a chief economist at Bear Stearns's. Banga, now vice-chairman at US investment firm General Atlantic LP, has previously worked for Nestle SA, PepsiCo and Citigroup.
“Nothing in Banga’s resume inspires confidence that he will turn the World Bank away from a path of neocolonialism and predation by global north corporations upon global south countries,” said Jeff Hauser, executive director of the Revolving Door Project, a not-for-profit group that fights corporate influence in Washington.
Hauser called on US President Joe Biden and Yellen to retract the nomination. Despite an abundance of “highly accomplished figures committed to the public interest,” he said, the administration’s choice seems rooted in an assumption “those who govern best are those who have profited the most from deregulation, economic predation and the shrinking of the public sphere.”
The next World Bank leader will take over at a pivotal time, amid a growing clamour for reform of multilateral development banks and international financial institutions to unlock more climate finance in the developing world. Yellen is pushing the World Bank to evolve from its traditional focus on country-specific lending and shift to broader, global goods, such as fighting climate change.
The departing president, Malpass, came under fire after appearing to dodge questions on whether he accepted the scientific consensus that climate change is driven by the burning of fossil fuels and the resulting man-made greenhouse gas emissions.
“We don’t need another World Bank president who will further corporate interests like fossil fuels and industrial agriculture,” said Kate DeAngelis, international finance programme manager for the environmental group Friends of the Earth.
Traditionally, the US nominates the president of the World Bank; as the institution’s largest shareholder, the country’s voice usually carries the biggest weight. However, some progressives were goading other countries to advance credible challengers for the post.
“The rest of the world’s governments still have the opportunity to step in,” said Bronwen Tucker, co-manager of the public-finance campaign at Oil Change International. “They can and should nominate their own candidates, vote freely and demand a fair process.”
