Zoo Station

The international edition of Newsweek is carrying a profile of the Tata Group, describing them as a new breed of multi-national. Newsweek is right. After all, the Tatas have grown their current size without compromising on some core principles.

In some ways, Tata could exist only in India, where wages of $1.20 an hour make cradle-to-grave corporate welfare far more affordable than it would be even in China. But Tata is unique even inside India, where its rigid ethical standards are so well known that corrupt officials typically don't even bother asking Tata executives for bribes. Though India is a hotbed of labor strife, Tata Steel has gone 75 years without a strike. Tata's car plant at Pune has gone 16 years, and local union rep Sujit Patil says his people work with management daily, a state of labor relations "very different" from that at other Indian companies.

In recent years, as Tata began listing shares in some of its affiliates on Wall Street, Americans often compared the company to the model conglomerate they know best: General Electric. But CEO Ratan Tata, 67 , is no Jack Welch. "Certainly not," he says. Tata executives, many armed with Western M.B.A.s, have all read about Welch, and dismiss many of his American tactics—from mass layoffs to hostile takeovers—as violations of the Tata way. Ratan Tata says his company is not driven to grow "over everybody's dead bodies." This is a company where 66 percent of the profits of its highly successful investment arm, Tata Sons, go to charity. At Tata "corporate social responsibility" is not just a hot buzzword, as it is in the West, with no real money behind it.

Tata is a trend breaker among Asian family conglomerates, a breed whose incestuous flaws were exposed during the regionwide financial crisis of 1998. Even today, other Indian family business empires are breaking up around Tata (sidebar). One reason Tata has worked, says Ratan, is that it has been professionalizing its management for decades: he insists that, if anything, his status as a Tata landed him the worst assignments at "troubled companies," like textile mills, where he honed skills as a turnaround artist.

Ratan Tata would prove tough on white-collar staff. He used growing revenue from TCS, an arm of Tata Sons, to extend the latter's stake in each affiliate to at least 26 percent—enough under Indian law to exert management control. Then he pushed out recalcitrant chieftains, including the managing directors at Tata Steel and Indian Hotels. Today, he says, if Tata Sons has a U.S. parallel, it is Berkshire Hathaway, where Warren Buffett has "a say in the direction" of companies he has invested in.