India Inc should evolve its corporate social responsibility paradigms based on Gandhiji's trusteeship principle.September 7, 2011:
Industry observers have been cautioning us that corporate giants from India are moving a good part of their balance sheet to operations abroad largely for ‘administrative convenience'. The notorious red tape notwithstanding the liberalised policies, delays in obtaining trouble-free land for expansion, Centre-State authority overlaps, or even inter-Ministerial rivalries spilling over to applicants seeking clearances are now industry folklore.
A business weekly attributed this desire to establish abroad “to get the benefit of those countries' sovereign rating.” It is public knowledge that Standard & Poor rates India very low, reflecting on its fiscal deficit, inflation and other vital indicators.
Indian industry is going global. The corporates are getting bigger and diversifying within the country too. They need land, energy, water and minerals — all scarce and not completely renewable. Serious industry players want facilitation through governments, and no more. Public Sector Undertakings (PSUs) are too opaque for anyone to measure their productivity vis-a-vis their asset base.
Today's probity-conscious, rights-asserting India seeks better governance with lessgovernment. The industry has been longing for it . Ideally, it is expected that government works as a regulator with a large degree of transparency and remains accountable for its decisions.
It shall continue as a player only in sectors such as health and education where great disparity in access continues. In these sectors, the long-term implication of any governmental neglect on the much-talked-about demographic dividend shall be disastrous.
Henceforth, apparently, the active players of the economy shall be the industry – several small, many medium and those that are revving to forge ahead shall be those that are the large. It is equally apparent that the industry shall not confine itself to manufacturing alone; there are clear signs of their moving into agriculture too.
Therefore, it is time that India Inc revisited the idea of Corporate Social Responsibility (CSR) whose impact on society has been limited. Fashioned, as it was, in the Western consumer capitalistic world, it has remained like froth on the sea-waves.
It presumes ceterus paribus (all things being equal) and offers a few pennies for Good Samaritan activities. At times of expansion, can CSR ignore acquiring more than required tracts of land even after future demands are factored in?
Even in 1886, Leo Tolstoy, answered the question, “How much land does a man need?” The hero of his folktale can easily manifest in any of our corporate bodies!
CSR doesn't answer issues that arise when a large, say, thermal unit is super-imposed on a live, organic, complex fabric of a village which for centuries adapted to a level of self sufficiency.
Even if ‘for-the-larger-good' argument is conceded, the presence of any super-imposed structure has not helped these villages ‘to arrive'. An old Chinese adage on moderation observes: “Going beyond is as bad as falling short.”
On consumption or production, Western capitalism depends on price-mechanism to settle the issue, implying thereby that resources, even if scarce, given a premium, will remain available. Available, certainly for this generation! What shall we hand over to our children? In this context, can it be presumed that CSR is being fulfilled?
Efforts are on in the human resource departments of Western business houses, “to acquaint their managers with spiritual parts of life for better productivity, positive working atmosphere, and less and less greed.”
Seminars are being offered in the Leavey School of Business at Santa Clara University in California, “just to ensure that corporate people have clarified intentions, avoid the traps of excessive greed and power, and make decisions that are both compassionate and effective.” Many other schools too may be working on similar lines. But will it change their corporate philosophy?
Indian corporations should set their paradigms based on Mahatma Gandhi's trusteeship principle. A distilled essence of this principle is found in the first verse of the Isopanishad (Shukla Yajur Veda) Isavasyam idam sarvam...dhanam (the One God is present here and everywhere). It underlines that everything around us has the Supreme residing in them and hence He is the rightful owner. We, who actually possess it, can enjoy a “delegated ownership” as trustees.
For the coming generations shall receive it from us. In the meanwhile consumption was not discouraged, but we were cautioned not to accept what was someone else' quota.
The Mahatma's trusteeship beautifully explains that enterprise is not discouraged, while we know that socialism numbs enterprise. Gandhiji's trusteeship allows the entrepreneur to keep the surplus. It actively encourages spending the surplus for the benefit of the society.
So, one may ask, where is the difference? As the writer understands it, Gandhiji's trusteeship rests on three solid pillars — Ahimsa (non-violence), Samanta (equality), and Swaraj (self-rule).
Swaraj or self-rule is significant in the context of the current debate as it shall refer to the self-rule of the smallest governing unit — the gram panchayat. And this is the unit closest to the people.
The relevance of ahimsa needs no elaboration in the light of today's land acquisition debate. Not just lathis, but even the uncertainty of displacement can be described as himsa (violence) and hence engagement for negotiations, where and when necessary, should be on completely different parameters.
Gandhiji envisaged the entrepreneurs “to use their talent to increase the wealth, not for their own sakes, but for the sake of the nation and, therefore, without exploitation...Their children will inherit the stewardship only if they prove their fitness for it.”
The Mahatma also observed, “When the people understand the implications of trusteeship and the atmosphere is ripe for it, the people themselves, beginning with gram panchayats, will begin to introduce such statutes. Such a thing coming from below is easy to swallow. Coming from above, it is liable to prove a dead weight.” (Hind Swaraj, 31-3-1946, pp. 63-64)
Let us reassure ourselves that these are achievable standards. In India today, some entrepreneurs who have followed these principles who stand out as exemplars. They may not call themselves so, but they have practised these
Wednesday, 7 September 2011
Business Line : Opinion : India Inc and the Mahatma
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