Corporate governance is a core principle that cuts through the entire value chain of Puravankara, claims Abhishek Kapoor, CEO of Bengaluru-based company. In an exclusive interview with Track2Realty, he shares how transparency, integrity and respect are central to the company’s internal and external stakeholder relationships. Puravanakara has also established a strong ESG framework that guides the decisions as a business and a responsible corporate citizen. Excerpts of the interview:
Ravi Sinha: The Indian real estate has been pretty slow in catching up with corporate governance. How do you see this industry anomaly?
Abhishek Kapoor: Over the last two decades, the real estate sector has continued to become more organised and regulated. This has resulted in an inflow of equity investments, FDIs into the business, the listing of entities and increased consolidation. These, in turn, have paved the way for greater transparency within the sector. The introduction of RERA and GST has also contributed to a strong regulatory and taxation framework, which has helped inspire stakeholder confidence.
Collectively, these macro factors have fueled the evolution of the sector. However, being one of the oldest and hitherto a largely unorganised sector, the shift towards corporate governance has been comparatively slower.
It is prudent to note that the strengthening of regulatory bodies, increased professionalisation of the sector, and more players being listed have reinforced the importance of corporate governance across the real estate landscape. In fact, having an industry status would further goad the sector to greater adherence to compliance and disclosure and, consequently, better governance and access to capital.
Ravi Sinha: How do you see the balance between corporate governance, ownership structure and capital/stakeholders’ interests?
Abhishek Kapoor: Corporate governance is a fundamental framework that guides a company’s operational and organisational processes. Adherence to this helps bring greater transparency to all stakeholders – employees, promoters, and customers. In addition, it contributes to bringing larger and cheaper capital, attracting top talent, gaining the trust of customers and shareholders, and instilling a sense of pride within the workforce. Governance also puts healthy pressure on the business to continually improve and optimise its operations.
Ravi Sinha: Corporate governance issues are larger than just compliances. What, according to you, is the ideal form of corporate governance in real estate?
Abhishek Kapoor: Corporate governance works like a moral compass for the organisation. At Puravankara, it is a cornerstone of our decisions and policy formations. We regularly monitor our controls and audit processes to ensure adherence to governance. To ensure compliance, we objectively and carefully gauge the relationship between the management and shareholders, for instance, related party transactions. This healthy checks-and-balance system enables us to create tremendous value for all our stakeholders.
Ravi Sinha: There is a general perception that the nature of the business is owner-driven, and the world over real estate lacks professionalism compared to other industries.
Abhishek Kapoor: Today, there is a significant shift in this perception in India. Many family-run realty businesses are deeply invested in professionalising their business. In parallel, professionals from diverse industries like banking, insurance, FMCG and top-grade educational backgrounds are choosing to build lucrative careers in the real estate industry.
Being listed and increased professionalisation pushes a company to become more transparent with its stakeholders, authorities, the public and the media. Today’s discerning customer is cognizant of these factors and prefers a certain level of professionalism while choosing a developer.
Ravi Sinha: How differently do you handle the corporate governance issues at Puravankara? Q Any best practices that you have adopted in Puravanakara that sets you apart?
Abhishek Kapoor: Corporate governance is a core principle that cuts through our entire value chain, which sets us apart as a company. Since inception, we have ensured 100 per cent compliance and adherence to the norms laid by the regulatory authorities. Through a performance and value-driven structure, we have created a workplace that empowers our employees to attain their full potential. Transparency, integrity and respect are central to all our internal and external stakeholder relationships. Additionally, we have established a strong ESG framework that guides our decisions as a business and a responsible corporate citizen.
Overall, we strive to create tremendous value for our stakeholders, communities, and the nation at large. Having strong corporate governance helps achieve this vision to a great extent.
Ravi Sinha: Compensation structure, ability to retain key personnel, financial stability, pending litigation and trading in own stock are some criteria used to assess the management quality. What is your track record vis-à-vis the given parameters?
Abhishek Kapoor: In terms of compensation we offer one of the best compensation structures in the industry. We also have strong performance-based incentives and variable programs designed to benefit our employees greatly. Our average employee lifecycle is one of the highest in the sector, and we have always been able to retain top talent.
In terms of financial stability, the intrinsic value of the company’s stock and the performance of the company has continued to grow from strength to strength. Our YoY growth, reduced debt levels over the last three years (from INR 3000 crore to less than INR 2000 crore), improved credit rating, and lowered cost of debt – all indicate strong financial stability.
We do not trade in our stock. As a company, we try to settle issues without resorting to litigation as much as possible. We only undertake legal recourse in the absence of an alternative.
Ravi Sinha: Have you ever assessed your C-SAT (Consumer Satisfaction) Score?
Abhishek Kapoor: Customer-centricity is central to our DNA; it is the core of our YOU philosophy. For us, customer satisfaction is a moving target, not one singular point. We regularly assess the C-SAT score to identify areas that need improvement and ensure that our customers achieve more at every interface. The feedback from our customers helps us gauge their sentiment and positively shapes the customer experience.
Ravi Sinha: What are the ideal ways & means of consumer connect in real estate and how differently Puravankara does it?
Abhishek Kapoor: We curate several programs to connect with our customers and foster a sense of community. One of our initiatives to achieve this is the Purva Connect Program. These are theme-based carnivals that are organised for our customers in completed projects. We also host a Safe Day for soon-to-be handed-over projects. This serves as a platform for our discerning customers to visit the site from a safe distance and see the progress of the amenities, roadways, and the project. All fixtures and fittings are on display which helps customers understand better and appreciate the detailing that goes into their homes.
Throughout the year, we work closely with residential associations to set up relevant service camps for health and recreational events and partner with niche service providers to provide a unique experience to our patrons.
Ravi Sinha: How robust is the consumer grievance redressal of Puravankara?
Abhishek Kapoor: Our grievance procedure is designed to offer quick and effective solutions to our customers’ concerns. The customers can reach us through various channels. We have escalation handles for the immediate resolution of queries. The nodal desk acts as a bridge between various departments and the customer service committees. The nodal desk is empowered to ensure that feedback is expeditiously implemented while ensuring compliance with all regulatory guidelines while handling customer complaints. We endeavour to improve all our processes constantly.
Track2Realty is an independent media group managed by a consortium of journalists. Starting as the first e-newspaper in the Indian real estate sector in 2011, the group has today evolved as a think-tank on the sector with specialized research reports and rating & ranking. We are editorially independent and free from commercial bias and/or influenced by investors or shareholders. Our editorial team has no clash of interest in practicing high quality journalism that is free, frank & fearless.
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