The basic premise behind what is being presented here is that capitalism as an economic system is the ideal. Unfortunately the influence of people on capitalism is causing the system to be unfairly criticized, so if the system is good how do we encourage moral and ethical change? The proposal is the introduction of certified membership to an independent CSR brand, encouraging organizations and leaders to comply with and belong to a community, which is focused on implementing and enacting socially responsible business practices. The decision to implement moral and ethical change in an organization cannot be in order to comply, instead it must be a conscious decision driven by business leaders and stakeholders with the right motives and value systems. It must be a choice.
The general decline in societies moral and ethical framework has lead to a catastrophic failure of our current economic system. During the nineties governments began deregulating the financial goods market. This in combination with other institutional and economic factors started the ball rolling for dishonest corporate and entrepreneurial behavior. Combining this dishonest behavior with increased pressure on people to perform at both organizational and social levels, business has become like the Wild West of old. The problem we face now is how to make organizations and entrepreneurs alike conform to a level of social responsibility that is acceptable for all, and allows capitalism to operate as the preferred economic system long into the future. It is vital that we unite business and community with a common goal for the good of all people not just a select few. We as a wider community need to hold each other accountable; there is no longer room for excessive greed, selfishness and personal desire within business.
I propose a solution that involves the development of a transparent management system where an organization is required to report regularly on its ability to meet a set of formal CSR reporting criteria, unlike ISO26000 it would be certified under its own recognizable brand. The proposed changes would introduce transparency in the organization allowing all levels the opportunity to be involved in and aware of the businesses commitment to: organizational governance, employee rights, labor practices, environment, fair operating practices, consumer issues and community involvement. Currently it is common in organizations to see closed-door decisions made that have a direct impact on employees, communities and consumers without any real consultation or accountability. What I am suggesting is to change the way that management is held accountable within the organization and greater community. I propose the implementation of a common brand so that the wider community can associate organizations with this mark; the aim is to create a community of businesses that can be identified easily as organizations that meet the required standards of a CSR business. As the community grows so too will the pressure to belong.
It is envisaged that in much the same way we present our monthly reports organizations would also present a CSR report that is distributed to all levels of an organization. This report would need to address topics similar to the ISO26000 core subjects: organizational governance, human rights, labor practices, the environment, fair operating practices, consumer issue and community involvement. The exact reporting requirements, topics and formats would require further research and development. A key aspect to the implementation of this type of reporting is transparency, if all levels of an organization are given regular reports indicating that set criteria are being met then the net result of this will be improved positive psychology within the organization. If we look at the three facets of motivation for positive psychology: belief that the organization and its people are making a difference, the stakeholders individual belief in their own values and the sense of being part of a common community then the benefits of being part of a group with a common goal can only positively radiate through an organization.
The idea would be to implement a cloud based software system for reporting and recording the organizations CSR. Any organization wishing to test whether the system is suitable would be directed to the brands web site, where they could download a trial and read the requirements for certification. If after that they choose to make a moral and ethical change in the way they do business they then apply for certification and membership. When the organization has been certified they are able to apply the brand to their marketing and become part of the certified CSR community.
We can make capitalism a sustainable and long-term economic system but it is going to require a change in the attitude of leaders and pressure from employees and consumers forcing organizations into conforming to a new kind of socially responsible capitalism.
Dr. Bernie Frey, Massey University, New Zealand
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