Giving to the poor – is that really the role of a business?

 

Ports of Auckland – the company played hardball, but how much has that position cost them?

The triple bottom line model is now almost universally applied in sustainable business, but I’ve noticed that the social dimension is frequently limited to various forms of charitable behaviour. Now before I go any further, I agree entirely with businesses donating money, expertise, goods and staff time to charities, but I think there’s another and better way for a business to demonstrate social responsibility. It involves recognising that a business is a member of many different communities, and that every member of those communities has a responsibility to treat every other member fairly or that community and it’s members will fail.

Employees:

Too many businesses treat employees in an adversarial way. They don’t trust them, they watch over everything they do and are fast to punish any infraction while paying as little as possible and making sure that every hour paid is an hour worked. I’ve worked for people like that, and in one case over a 18 month period they had a 100% staff turnover with all but one of the dearly departed taking a successful personal grievance against them. Yes, including me.  They’re an extreme case, but that mindset is very common and hurts everyone, especially the employer. Acting like that exhausts the finite supply of employees and is an unsustainable business practice.

So what’s the sustainable way? The first thing to remember is that your employees have the same goals as you. They want your business to succeed because not only will that improve their job security, but it will give them the pride of being part of something successful – nobody likes being linked with failure. Treat them with respect, listen to them, make it as easy and pleasant to do their job as possible and give them a sense of ownership in your business. In return they’ll reward you by respecting you, coming up with ideas to improve things, working harder and promoting your business to their networks. And you’ll find that if times get tough they won’t mind if you can’t afford to pay as much as your competitor has to because you have treated them as a finite resource to be nurtured and sustained.

Suppliers:

A lot of businesses treat the relationship with their suppliers as a contest to see who can come out on top. Prices are driven down, bills are paid on the last day possible and visits by reps are treated as annoying interruptions.

The sustainable business strategy is to see suppliers as partners who provide the goods and services the business needs to remain sustainable. Prices are fair to both sides because they know that if the supplier doesn’t make a decent margin their economic sustainability is undermined and there is no incentive to go the extra mile with service. They also know that if they treat their supplier as businesses partner, that supplier will always be on the lookout for better ideas, better products and new opportunities as well as passing on savings. And if things get tough and they need support through things like extra credit and more time to pay bills, they’ll get that support. By ensuring suppliers are able to remain sustainable it means they will keep your business sustainable.
This is part one, thanks to a finite number of hours in the day the rest will have to follow in a few days or this blog is unsustainable. Have a look at an earlier post on a sustainable way of looking at the competition here: The art of making an enemy into a friend

 

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5 thoughts on “Giving to the poor – is that really the role of a business?

  1. “…treat employees in an adversarial way…don’t trust them…watch over everything they do…fast to punish any infraction while paying as little as possible and making sure that every hour paid is an hour worked…” Sadly, I can relate to this.

    After two redundancies in 2009, I was desperate to find another job. I decided to look outside of my home town to find work and accepted a position as the “Business Manager” with a specialist engineering company. The money was appropriate but, as I soon discovered, the conditions were most definitely not!!

    It didn’t take me long to learn that none of the current employees (apart from the partners) had been there any longer than 6 months. None of them had been trained properly. We were all working 9 hour days (with a half-hour lunch) and most of the specialist staff members were working night shifts as well. The day I questioned their workplace health and safety practices was the beginning of the end. The fact that I needed time during my first week to organise a place to live didn’t got down too well either.

    When we mutually agreed that it wasn’t working – just one month after I started – I was still waiting for access to the files I needed to do my job. Their security settings were so strict that they couldn’t give me access to even the most basic business information. The other staff members were reporting my every move to the boss. My stress levels were through the roof and, in their opinion, it was all my fault. I had never been so happy to be unemployed.

    • They didn’t trust their employees and to me that is like someone who is profoundly homophobic because they are terrified that they may be gay themselves (or at least swing both ways) – their distrust suggests that they have something to hide.

      • Hehe…that rings true. Part of their reasoning for asking me to leave was that (in their opinion) my previous, extensive government experience had made me unsuitable for work in their private sector business, but the owners had both previously been long-term public servants themselves.

  2. That’s an interesting perspective. I have often held that one of the greatest causes of our frenetic consumption is because we live empty lives and believe the advertisers that tell us that consuming more is what will lead to fulfilment

  3. I think there is a real danger in businesses ‘giving to charity’ and counting that as social responsibility. What I see is that continues the cycle of dependency. Yes a business can find a cause that is closely related to its values, or its supply chain or customer interests and work with that cause. In my opinion the intention should be to work to eliminate the concern that has created the cause!

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