Building the Sustainable Organisation

I spoke on Saturday, July 25th, at an event organised by SHRM India and MTHR, on the topic of sustainability.

As usual, my session centred around my pet theme of humane capitalism. I spoke about my theory about the evolution of capitalism to a state where business enterprises will embrace sustainability as a strategic initiative which is part of their business model, rather than having corporate social responsibility and triple bottomlines imposed on them from outside.

I had a very engaging audience this time, and I was delighted to find myself challenged at various points of the address, which led to animated discussions on my thoughts and beliefs vis-a-vis the reality in business.

One of the thoughts that generated a lot of heat was my assertion that corporate social responsibility is imposed, necessarily, from the outside on a capitalist enterprise. The basic nature of capitalism is the pursuit of profitability and increase in shareholder wealth. Social and environmental responsibilities, if they fit into the strategy to increase profits, are embraced willingly; however, if they don't, they fall by the wayside. I believe that CSR has been more abused than used as a tool to improve social and environmental welfare, and am a willing sceptic of most CSR iniatives with respect to their intention and ability to improve social and environmental conditions.

The biggest objection to this position of mine was the fact that there are several business houses in India, notably the Tatas, who have been engaging in corporate social responsibility for years. This was the key challenge to my point about CSR. It made me think about my position and evaluate my arguments.

The conclusion, however, is that my views remain unchanged. I believe that the actions of the Tatas resemble those of, say, Bill Gates. The Tatas are philanthropists; giving is in their blood, in a manner of speaking. And they have not given because they believe it is a responsibility. They have been giving of their free will. Because they believe, genuinely, that by giving back to society, they will make some difference to the lives of the people who are touched by their generosity.

Is that Corporate Social Responsibility? Or is that individual philanthropy? I believe it is the latter. And that is because it rests on the philosophies of the Tatas as a family of businesspeople, rather than the enterprises they run.

Perhaps the fault lies in the nomenclature of CSR. From what I have seen through my research on CSR, I continue to believe that it is imposed from the outside on organisations. Some are willing and others unwilling, but that doesnt change the nature of CSR.