To begin with, one needs to redefine our goals in life to improve the world. This is necessary as a starting point and Maira narrates a different kind of fiction, where he gives examples of how some people decided to change their lives while working with the corporate world.
There is a growing clamour all over the world that the objectives of a company can’t stop at just enhancing stakeholder value. The edifice called the new corporate social responsibility dictum is the starting point when we look at how companies operate beyond just profit indicators. They need to serve the broader interests of society and this is what Arun Maira focuses on in his book, Transforming Systems.
His experience as a former member of the Planning Commission enables him to cogently put forward the concept while his stint in a management consultancy firm makes the articulation forceful and compelling, though difficult to grasp at times.
The dominant idea, according to Maira, is not only “should the business of business be only business”, but that “countries, governments and civil society organisations should also be run on principles of business.” This becomes compelling given that while economies had been growing, systemic problems of social inequality and environmental sustainability have become less-tolerable? A new toolkit is required to attain these goals that go beyond the precepts of good business management and prevalent best practices in government as well as civil society organisations.
The exposition is in four parts. To begin with, one needs to redefine our goals in life to improve the world. This is necessary as a starting point and Maira narrates a different kind of fiction, where he gives examples of how some people decided to change their lives while working with the corporate world. He says these are real people with fictional names that add characteristic hues to their stories. Some ethical issues need to be discussed, which we can relate to — like difference between organisations designed for commitment rather than mere compliance. The challenges are in answering questions like: How does one scale up results in the social sector? Who are the leaders in the system?
The second part deals with the search for a new paradigm that logically follows how different systems are explored to achieve the objective of changing the world. Here, the consultant in Maira steps in and draws up scenarios for linking of purpose with organisation, processes and resources to build a virtuous circle. They all tend to get interlinked. This part gets technical and could get hard for the reader as it deals with complex structures and purposes.
At the third stage, which deals with reorienting our minds, Maira brings in principles of Piketty to hammer home the point that the job of a corporate is to also play a role in changing society, given the level of inequality that exists especially in countries like India. The onus is on us to redefine these new guiding principles. Here, the author takes us through various paradigms under the ‘conventional’ and ‘system’ approaches. There would now be a difference in the way in which we see and work on things. The words which we use change from ‘engineering’ to ‘gardening’, ‘constructing’ to ‘generating’, ‘controlling’ to ‘catalysing’, etc. From being away from the system, we become a part of it. Instead of ‘markets’ we think of ‘communities’. Efficiency transcends to equity and income is looked at as a ‘feeling’ rather than a ‘fact’. Finally, as individuals we change from having more to being happy, and move from ‘I’ to ‘we’, competing to supporting, speaking to listening, etc. With this change in mindset, business enterprises would become more ethical and work for a bigger goal.
The fourth part is about leadership, where Maira clubs various types under different headings. Since independence we followed a system where the central government dominated with centralised planning that fully controlled all economic forces and did not allow others to rise. Here he draws an analogy to “buffaloes wallowing in a pond”. The second is ‘peacocks strutting’, where the rich dominate and one has to wait for the trickle down effects, which seldom happen. The rich become richer and have a disproportional influence over the state of governance and policy in the country as they fund parties and take over media and companies and it is their opinion that is sought by the media and the government. He then talks of the model of leadership where the ‘tigers’ growl’ and the others cower, which is typical of dictatorial regimes where opposition disappears and people lose freedom. Here, too, those at the top thrive at the expense of others. The last is what he calls ‘fireflies arising’, where there are multitude of small leaders with a vision and enterprise, who have a passion to do things in an ethical way. This is the new ideal system according to him.
The book, in a way, is quite complex to grasp and gets technical at times as it deals with a utopian objective. The drive is to move us to becoming more humane when we strive for profit. This is a challenge given that all companies these days talk of shareholders and are judged by the same. Their activity towards making society better is more or less restricted to annual reports, as it is mandatory to do so. But seldom do they go beyond compliance.
Maira’s views can be contested because the pursuit of profit, as long as it is done in an ethical manner paying obeisance to the law of the land, cannot be criticised as governments have their role to play and cannot transfer their responsibilities to companies. Often the inability of the government to deliver makes them pass the onus to corporates, which may not be right.
(The author is Chief Economist, CARE Ratings)