Firoz Abdul Hamid's Blog

PLEASE - CSR is not Ethics In Business!

July 9, 2013

I was watching Lord Adair Turner, the Former Head of Financial Services Authority of the UK, on Al Jazeera today discussing the topic “Has Capitalism Failed The World”. The discussion of course circumambulated the customary, should we have more or less regulations, more public banks and less private banks, why haven’t we seen bankers incarcerated for the millions and billions that disappeared from major economies around the world through the process of daylight casino called the financial market.


I was waiting for the whole discussion on ethics to appear miraculously – what it is and has it a role to play in our fast desecrating world today. Not surprisingly, I was disappointed.

Malaysia (which is where I am writing this blog from now) and Singapore was greeted by its annual “haze” from our neighbour Indonesia last week. This time the international media covered it to some great extent and I would suspect because Singapore’s key tourist and business locations saw its air quality reaching abominable levels. This problem did not just appear like some fall of an iceberg or an ash cloud. It has been going for years if not for over a decade. There was sparring of words of course. Whose companies, whose problem, who did what when and why. Year in year out ASEAN leaders meet, APEC leaders meet, Foreign Ministers meet and the list could go on – this problem remains but a problem. One has to wonder if it is even on the agenda for discussion.


Having worked both in private and public sector over the some 20 years and having been exposed to decision making process, I have searched for answers to questions like - on what virtues are countries and governments run? On what virtues are businesses operated and to what does it pay homage to? Is ROI and ROE equivalent to Ethics? Is meeting stakeholder expectations enough to run an ethical business? Indeed what is ethics in business? Where is our hearts and souls when we leave our homes everyday for work? What anchors us in all that we claim to do in the name of business, in the name of politics, the people, the environment and of existence itself?


When we are children we are taught morals and good values at home and in our Sunday masses, mosques, synagogues, temples and equivalent places of worship – but do we apply these values when we reach our adult lives and in our work places? Arguably no because if we really did , why would this planet face such catastrophic issues with the environment today, why do we contend with market failures led by greed of a few, why would we even need our food to be organic when in fact all food should be pure in its essence? How and what compromised our food and livestock such that we need refined food called “organic”? I will not even get into the argument of is “organic” food a marketing hype or are they indeed more superior in quality.


Year in year out we have the World Bank, World Economic Forum, IMD in Switzerland to name a few, grading countries’ competitiveness and business processes. Yet the most competitive countries are not necessarily the happiest to live in according to the Happiest Country Raking (another new ranking). Of course we also have such indices from Transparency International on corruption.


Where does Ethics rank in any of these rankings? How do we evaluate ethics? Is Ethics in Business so nebulous in its concept and form that we shy away from measuring or legislating it? Indeed who should be regulating and legislating ethics? How does one legislate human character for in the final analysis it is humans who are enabling the destruction we sometimes proclaim to do in the name of progress?


I would go as far as even questioning what is progress? Higher buildings? Bigger airports? Longer highways? Bigger and larger burgers and drinks? Bigger billboards and larger consumer markets?


And then of course we have companies and institutions investing in such things like corporate social responsibility (CSR) projects to give back to society in show of commitment to ethics. Still I remain cautious of these programmes as we know how some companies are reported to have used some of these projects as a loophole for tax evasion. An article in 2012, argued that Starbucks had gone to great lengths to boost its Fair Trade use and CSR for its sustainability of business. But its tax issues in the UK sullied its reputation. So if it was investing in CSR, in the instance of Starbucks, shouldn’t all of what the company does be anchored on Ethics? Or are we missing the point on Ethics altogether here?


Thomas Hardy in one of his most acclaimed works wrote a novel on The Mayor of Casterbridge (1886), subtitled "The Life and Death of a Man of Character". The novel tells the story of Michael Henchard who rose from the slums of life to become the Mayor of Casterbridge. But his past would haunt him causing his inevitable downfall. The crux of this tale tells the nuances of what makes us all – our characters.


No matter the height we reach, that which sustains us (or destroys us) is what lies beneath, what lies within and what lives inside of us – our characters. The mettle of what we are as a being is often tested in good and in bad times. All too often we glorify a delusional self. The self that looks good on the silver screens and on media. We love the charismas of Madoff like beings only to find too late that it was a mirage. History is strewn with failures of great men who formidably controlled their countries and businesses. They failed. Movies and books were made and written on them. Prognoses were made and then we move on to the next and the next.


But underneath it all do we ask ourselves that perhaps it is these Mayors of Casterbridge that we have running our own institutions and businesses today in our countries. And so do we have the tools to seek them out? To stop the disasters they could effect? To arrest whatever little we may have left to salvage this planet for the next generation as our legacy for them. How do we stop a “Madoff” at the gates of entry?


Great civilisations are not built on ubiquitous grandiose plays. Great civilisations were built by people of great characters. Characters, whose virtues would be the springboard for the next generation and the next generation. And so isn’t it logical that as a civilisation our global institutions and powers pay homage to this whole notion on Ethics In Business?  

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