v s das : leadership, performance and transformation through personnel management inaugural address by mr v s das, executive director of the reserve bank of india, at the seminar on “ leadership, performance and transformation through personnel management ” held at the jamnalal bajaj institute of management studies, mumbai, 15 july 2012. * * * i thank the students of jamnalal bajaj institute of management studies ( jbims ), mumbai for inviting me to this seminar, aptly titled “ the catalyst ”. for me, being here, in my alma mater, is special, and being the chief guest today is therefore doubly special. i am also happy to be sharing with you my thoughts on a subject, which has been close to my heart : leadership. i remember having studied transformational leadership and its impact on organisational climate and unit effectiveness as a part of my mam programme here several years ago. leadership, performance and transformation through personnel management, at a time when near - seismic changes are taking place, especially in our global economy is, to put it mildly, a difficult and daunting task. what i would try today is to aim at putting into perspective the theme as an integrated issue and prompting further reflection on this significant subject. performance has long been a focus for organizations concerned with increasing efficiency and productivity. the management of “ leadership capacity ” is, however, a relatively more recent consideration. organizations across all sectors now regard leadership as a key enabler of organizational performance and competitive advantage and are investing increasingly into leadership development activities. many have now turned their attention to how best to manage their leadership talent to ensure succession, progression and the delivery of organizational objectives. the present global scenario is so paradoxical, confusing and filled with contradictions, dilemmas and ambiguities that, as someone put it, “ if you ’ re not confused, you don ’ t know what ’ s going on ”. in these baffling times, predictability and certainty are being replaced by a more relational concept of the universe, what was bad yesterday is often considered good today and what worked for decades is suddenly old fashioned. there is a rapid questioning of what is acceptable and what is not, driven by the values of today ’ s changed structures. in this relativist world, leadership styles too are necessarily relative to imperatives of the time, the personality of the leader and the location of the institution in its growth trajectory. recent research in this area suggests that one must look beyond

sarb to directly stimulate growth and address unemployment. the sarb ’ s mandate, which is to achieve and maintain price stability in the interest of balanced and sustainable growth, is enshrined in the constitution. in this regard, by keeping prices stable, the sarb creates the necessary economic environment for sustainable growth and development. an economy with stable inflation provides certainty, improves planning, and therefore supports consumer, business and investor confidence, which are essential in driving economic activity that facilitates growth and employment creation. lower prices also support south africa ’ s competitiveness in global trade. the inflation - targeting framework has served south africa well. it has helped us achieve lower inflation and therefore lower interest rates. it has also increased the transparency of monetary policy, and made the sarb more accountable for its actions. we have come a long way from the days when the governor could decide on interest rates in his office on a friday afternoon, and not even publicise his decision, let alone his goals or reasons. in terms of inflation, south africa has joined many other emerging markets in getting inflation down to fairly low single - digits. in the 1980s our average inflation rate was 15 %. it was nearly 10 % through the 1990s. since the introduction of inflation targeting, 5kenneth roggof ( 2019, april ) “ how central bank independence dies ” available at : https : / / www. project - syndicate. org / onpoint / how - central - bank - independence - dies - by - kenneth - rogoff - 2019 - 05 page 5 of 7 in 2000, inflation has averaged just over 6 %, at the top of our target range but still substantially lower than in the preceding decades. it has also fallen further in recent years, to about the middle of our target range – the average last year was 4. 6 %, and we expect 4. 5 % this year. lower inflation means we can have lower interest rates. this is an economic relationship that makes a lot of sense, because lenders expect to be compensated for inflation, but it is often underappreciated in debates about inflation and the inflation target. the historical experience shows us we should take this point seriously : in the 1980s the sarb ’ s average policy rate was around 13 %. in the 1990s it was nearly 16 % - with a lot of volatility, including spikes over 20 %, because policymakers sometimes tried targeting the exchange rate, which is a much more difficult target than inflation.