Gandhiji’s Trusteeship offers Tools for Responsible Business

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Corporate Social Responsibility is  no longer a fad to be undertaken to fulfill government regulations. It is important for the long term survival of business. Companies paying lip service to CSR will find themselves struggling in the battle for survival faced by direct or indirect opposition from various stakeholders including the community and the government.

To say that there is a business case for  Responsible Business is to state the obvious. Responsible Business practices help the company to wade through the troubled waters of doing business . They face lesser hurdles and get greater support from various stakeholders, particularly its employees and the community. For companies the question is not why they should do CSR but how best they can do it.

A lot has happen in the area of Responsible Business over the past few years. Yet the battle has not been won. There is still a long way to go. According to Mallen Baker, well known writer on Corporate Social Responsibility, most of the activities that took place in Responsible Business, “represents the continuation of a trend, with new faces and actors stepping into the fray. The list of heroes and zeroes may change, but the key themes of growing expectations in business conduct, and increasing success in bringing the debate to the board room  table, is in line with where we have been over the last few years.”

Looking at the Indian Responsible Business scenario one can say that some positive steps have been taken but there is still a long way to go.  Responsible Business  following among corporates in the country has increased. While there has been quantitative progress improvement in quality is still a long way away.

CSR Not Alien Concept

Corporate responsibility is not an alien concept for Indian corporates. In its earliest form, it was reflected in approaches similar to corporate philanthropy and the Gandhian Trusteeship model. Corporates made donations in cash or kind, community investment in trusts, and provision of essential services such as schools, infirmaries, etc. Many firms, largely the ‘traditional businesses’ even now continue to promote philanthropy.

Responsible Business practices in India was first introduced in Mahatma Gandhi   through his concept of Trusteeship. Trusteeship exhorts business to operate ethically. It lays stress on the need for business to act as the custodian of peoples’ wealth. Gandhi said making money was not an evil if ethical means were used. He said businessmen should use the funds required for their wellbeing and set aside the remaining for the welfare of the poor and the needy.

Trusteeship is a means to transfer capital to the less privileged people in society. It describes the social responsibility of business towards customers, employees, shareholders and society. Most economists agree that the Gandhian economics may not have many followers today but it is very comprehensive to deal with many of the problems faced  by Indian business today. One such issue is Corporate Social Responsibility which can be linked to Gandhiji’s concept of Trusteeship. Absolute Trusteeship may not be attainable. Yet if businesses behave as Trustees they will be able to build organisations which are viable and at the same time benign.

Mahatma Gandhi’s Trusteeship is very relevant for business even today. There are some who would say that it is more relevant today than it was earlier. Gandhi was for distributive justice with business acting as a Trustee to its stakeholders. According to Gandhi “Economics stands for social justice, it promotes the good of all equally, including the poorest of the poor.”

Ms Namrata Rana a strong supporter of Gandhian Trusteeship in an article in CSRWIRE, a British

Namrata Rana

Responsible Business online publication, says Trusteeship “ is uniquely Indian and provides a means of transforming the present unequal order of society into an egalitarian one. Under this principle surplus wealth needs to be kept in trust for the common good and welfare of others. It also specifies that everything we do must be economically viable as well as ethical – at the same time making sure we build sustainable livelihoods for all.”

Trusteeship More Relevant Now 

The challenges of sustainable growth, she says, necessitate another look at Trusteeship which can provide a long-term solution to solving the conflicts of society. “ The Gandhian perspective is more relevant today than it was ever before. Gandhi wanted to ensure distributive justice by ensuring that business acts as a trustee to its many stakeholders, and specified that economic activities cannot be separated from humanitarian activities. Economics is part of the way of life which is related to collective values.

“Gandhi said: “true economics stands for social justice, it promotes the good of all equally including the weakest and is indispensable for a decent life.” This has implications at the macro economic level as well as the micro level, as it talks of equitable distribution of wealth being a measure of success, rather than the current form which has high income disparities. “ It also builds the case for CSR being embedded within the business values of the private sector as Gandhi clearly stated that distribution of wealth is not about charity but about ensuring basic human dignity.”

According to Rana, inherent in the Trusteeship philosophy are entrenched solutions to many of the challenges of the 21st century:

·         Sustainable consumption – consume what is enough for your needs without doing harm to others.

·         Utilizing natural resources in a sustainable way – you are a trustee and you need to take care of what has been freely provided by nature.

·         Dignity of labour and equitable distribution of wealth – wealth alone is not the answer. To feel happy you need to ensure that the people who work for you and the community you work in is taken care of.

·         Sustainable livelihoods – not charity – are key to ensuring human dignity, growth, satisfaction and well being.

Flood Gates For Foreign Firms

Indian companies need to revisit the Trusteeship concept to ensure that they can actively reach out to the people they are trying to impact. While government has set guidelines for companies to follow these guidelines are causing more confusion among the practitioners. There is much confusion regarding the activities that constitute CSR.

India does not need foreign knowhow to run its welfare schemes. We have the experience and ability  and the heart to do what is right for the suffering and the deprived. India needs its own home grown CSR. Our needs are different from those of the developed nations. Whereas in the West the need is more for environment management and protection in India the need is for improving the living conditions of its people. To do this we do not need international knowhow. It is time we stand on our own two feet and avoid aping the West.

CSR has only opened the floodgates for foreign firms setting up CSR consultancy shops in India. Most of these are Public Relations firms who pose as experts on CSR. Many of these companies have earned a controversial reputation in the country. One of them Price Waterhouse was involved in the Satyam scandal and was barred by the Securities and Exchange.