Building an institution where Decision-making is institutional, not personality-driven

For over a decade, I had the opportunity to help build an institution (Caspian Debt) with a simple but demanding idea at its core: decision-making should be insitutionalised and not dependent upon the “boss”. Over the past year or so after I left Caspian Debt, multiple people reached out asking about the “mechanics” of how Caspian Debt was able to maintain good quality credit portfolio and create so many pioneering financing models while sticking to the core impact thesis. So, here it is. This is a two part series and this is part 1. Read part 2 here.

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In lending, the quality of credit decisions defines the quality of the institution. Over time, I came to believe that the real challenge is not just making good credit decisions – but ensuring that decisions are made consistently, transparently and independently of leadership.

The goal, therefore, was clear: build an architecture where decision-making is institutional, not personality-driven.

It began with intent. Caspian Debt’s Founder Prasad’s willingness to decentralise authority created the conditions for such a system to emerge. Prasad was comfortable not being the decision maker. So, much so that he handed over the day to running of the organisation to me for several years before ultimately letting me run it as a CEO for 3 years till the merger.

At the core of the decision making architecture at Caspian Debt sat the credit committee and the design of how it functioned was deliberate. Every member of the committee had veto power. While the CEO was the Chair, s/he couldn’t overrule a veto. And, we have had a few instances of single members vetoing transactions.

This was not about slowing decisions down; it was about recognising reality. In lending to early/growth stage companies no single individual can fully understand every dimension of a deal. Financials, industry dynamics, promoter behaviour, structuring nuances – each brings its own complexity. Beyond that, many decisions involve subjective judgment, often shaped by individual worldviews and experiences. By allowing any single member to veto a decision, we ensured that concerns – especially those that may not be easily quantifiable – could not be overridden by majority consensus or hierarchy. It prevented artificial alignment and created space for dissent. In doing so, decision-making became both decentralised and deeply accountable. The credit performance of the portfolio spoke for itself.

The credit committe was open to everybody to attend. The juniormost and the newest employees irrespective of their function could attend. The credit committee evolved beyond a formal step in the credit evaluation process. It became a space where people learned how to evaluate risk, articulate concerns, and engage with differing perspectives. It was not just where decisions were made – it was where training was given and judgment was developed.

However, structure alone is insufficient without visibility.

One of the early changes we made was to move deal-related conversations away from fragmented email threads into centralised platforms. This ensured that discussions, assumptions, and trade-offs were recorded and accessible in a centralised deal pipeline software. Anyone in the organisation could trace (to a reasonable degree) how and why a particular outcome was reached.

To reinforce this, we invested in data systems that captured not just outcomes, but context. Dashboards surfaced key metrics alongside the history of discussions, enabling individuals to understand patterns over time. We built a deal structuring system on the software with a recommendation layer that further strengthened this by highlighting comparable past deals – bringing institutional memory into everyday decision-making even for new employees. In parallel, standardisation was introduced through selectable deal clauses, allowing even new team mebers to structure transactions within a consistent framework while retaining flexibility where needed.

Another important principle was the removal of gatekeeping. Access to decision-makers was not mediated. If somebody needed to meet a senior team member they didn’t need to go through a secretary. Calendars were open, and conversations were easy to initiate – just block time. This reduced hierarchy in practice, not just in theory, and encouraged faster resolution of issues. It also signalled that participation in decision-making was not restricted to a few.

Equally important was how people were introduced into this system.

New hires were given time to observe how things were done and were expected to challenge them. They were encouraged to notice inefficiencies – the “fences” that seemed unnecessary but also to understand that some constraints exist for valid reasons and hence to notice for 2-3 months and understand why they exist before challenging them. This balance helped prevent both blind acceptance and premature disruption.

We made several investments in creating a trust based culture. That strengthened this institutionalised decision making architecture. (I will write more about that in a separate post. Read part 2 here.)

The result was not a perfect system, but a resilient one.

Decisions were more consistent. Knowledge was more widely distributed. And most importantly, the institution became less dependent on any single individual. So, when senior people left, the “system” continued to perform. That, ultimately, is the test of institutional decision-making – whether it continues to function with the same clarity and integrity, regardless of who is in the room.