Through the series Bookmark, leading voices in the world of finance and business talk about the books that influenced them in their professional journey, and in some cases, also touched them at a personal level.

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In this episode, Jairam Sridharan, CEO, Pirmal Consumer Finance lists five favourites that shaped his beliefs

No man is an island. However independent-minded we might believe we are, our beliefs, our values, and in turn our actions are influenced in large part by the media we are exposed to, the company we keep, the books we read. For me, the last of these has had the most formative impact. Almost all my deepest beliefs can be traced, through some twists and turns, to a book I read at some point. Here is a small sample of some of those books and the beliefs that derived from them.

Factfulness: Ten reasons we’re wrong about the world – and why things are better than you think, by Hans Rosling

At the most fundamental level, I am an optimist about the future of the world, of humanity. We live in a time of so much negative noise that long-term optimism sounds anachronistically naïve and uninformed. While the reality is exactly the opposite. The world is indeed getting better. Along almost any dimension that we can think of, over the long term, the world we live in, across geographies, religions, educational or income strata, lives of the peoples of the world today are fundamentally better than they have ever been. Factfulness is a pocket-sized book that calmly hits you with a sucker punch, with a host of powerful charts and statistics that make this point, for anyone that is willing to listen with an open mind.

Bonus books – For those who are interesting in exploring this theme at much more length, I would recommend two tomes that pack enough stats on this theme to beat any pessimist into submission! The Better Angels of our Nature, and Enlightenment Now, both by Steven Pinker, have been incredibly impactful intellectual influences on my thinking.

Capital in the Twenty-First Century, by Thomas Piketty

Global news flow in recent years has had a certain sameness to it, across improbably different geographies. In countries as diverse as the USA, Brazil, India, Russia, Germany, we see the emergence of very similar schools of thought, and skepticism around international institutions established over the last hundred years.

Is there an underlying theme that connects all these nations and their societies? Thomas Piketty’s book was, to me, a potential answer. We live in times when inequality of income and (even more powerfully) inequality of wealth is starker than it has been at any time since the turn of the previous century. The fact that returns on capital have been higher than returns on labour (or “r > g” - the inequality policy-wonks love to sharpen their knives over) means that inequality rises, and inter-generational movement across the wealth spectrum is limited, unless explicitly target by policy.

To me, the chockful of charts in Capital, and the “r>g” debate were an eye-opener, and ever since I read Prof. Piketty, I have been convinced that Inequality is the defining social issue of our times.

The Signal and the Noise: Why so many predictions fail, but some don’t, by Nate Silver

As is probably clear by the choices above, I am a bit of a data nerd. I started my career as a data analyst (in a world that hadn’t yet heard the phrase “big data”) and I have always used data and statistics as impartial guides to my actions. With the emergence of more and more powerful computers and computational techniques, the ability to use data and predictive models to drive every aspect of our lives has grown exponentially.

Almost every modern business professional today, either directly or indirectly, is acting on the recommendations of models and predictions. But obviously, not all predictions are good. Which predictions are more believable – a projection made by elite global economists at the World Bank and IMF about what our economy is going to do next year, or the prediction by the weather-man on your local TV channel about whether it is going to rain tomorrow? (If you think the answer to that question is obvious, think again!)

Nate Silver, the young founder of fivethirtyeight.com, has a cult status amongst data nerds. The Signal and the Noise brings home the limitations of predictions, and the power of continuous, incremental updation of prior beliefs, over sudden revolutionary upheavals of one’s belief system based on a new piece of information.

Bonus book –For those who are skeptical about the power of Big Data and have this nagging suspicion that it has a dark side, I recommend Weapons of Math Destruction, by Cathy O’ Neil.

Predictably Irrational: The hidden forces that shape our decisions, by Dan Ariely

While I am a steadfast believer in the power of data to predict behaviours in aggregate, I am equally convinced about the inability of the individual human mind to consistently make decisions on a rational basis. Behavioural Economics has some of age in recent years, with two Nobel Prize since the turn of the century (Daniel Kahnemann in 2002 and Richard Thaler in 2017), the incorporation of ‘nudges’ as a mainstream policy tool in various governments, and mainstream media conversation on the differential efficacy of ‘opt in’ vs ‘opt out’ rules.

There have been an incredibly large number of books written on Behavioural economics in these last two decades (including those by the Nobel winners), but to me, the introduction to this field was through Dan Ariely’s exceptional and accessible Predictably Irrational. Ariely makes the powerful point in the book that people (your spouse, your friends, your customers, you) are not always rational … but they aren’t always irrational either. Neither are they randomly irrational. They are irrational in highly predictable ways! And once you understand those predictabilities, you will find it a lot easier to influence behaviour change.

Bonus books – Kahneman’s Thinking Fast and Slow is a classic in this space. And I also found Richard Thaler’s original book Nudge incredibly practical and powerful.

Why We Sleep: Unlocking the power of sleep and dreams, by Matthew Walker

There are some books that force you to reflect, some that offer you an amazing ride while you are with them. And then there are some that make you change how you live. For me, Matthew Walker’s book Why We Sleep falls in this last category. We all know the power of sleep as a restorative. Who doesn’t enjoy a little shut eye?

But we live in a world where sleep is increasingly seen as a distraction and self-induced sleep deprivation is a pandemic. “I can get by with only 5 hours of sleep” is likely to be met with “Oh I often get by on 4”. Reading Walker’s book (ironically) opened my eyes to the uncountable ways in which sleep is a primary requirement of life, and how inadequacy of sleep can significantly and consistently diminish physical and mental performance.

I am now, proudly, a sleep Nazi, pushing everyone at home to go to bed and not get up till they get their full eight hours. And my life is so much the richer for it.

First Published:Sept 21, 2020 3:30 PM IST