As companies draw to a Quarter Close, there is palapable pressure and tension. Many corporate leaders stop smiling. You will notice many of them come out to various business TV channels and speak on what is happening in their companies. The results may be good but they are still very tense. There is lot of behind-the-scene activities to ensure that what was committed to the Street is delivered. The whole world may be falling apart around us, the Industry in which our companies operate may be having a poor business cycle, our customers may not be buying in the market from any company but the Street expects us to perform. If this is what the Street calls growth, we are barking up the wrong pole.
I heard the Managing Director of one of the top Indian Groups talk on what he understood of sustainable growth. He talked of his conversations with few unlisted, family managed companies that had survived for the last 120+ years. He said that they managed their businesses based on 4 key principles:
I heard the Managing Director of one of the top Indian Groups talk on what he understood of sustainable growth. He talked of his conversations with few unlisted, family managed companies that had survived for the last 120+ years. He said that they managed their businesses based on 4 key principles:
- Never look at "Maximizing Profits" but rather work towards "Fair Profits";
- Recognize that your company cannot grow every quarter when the economy it is operating in is going through a down turn - so, do not expect to grow every quarter;
- Never exploit resources - use only what is needed - the example I could think of was why should companies trawl for fish instead of just fishing to the extent that they can sell. That way, fish can survive and we can get more fish in the long run - we end up killing the Golden Goose in the name of Productivity;
- Never manipulate the system - i.e. do not bribe the government or do anything that will make money but corrupt the society.
There is so much truth to these 4 timeless principles. If only we can get companies and the Streets around the world to get out of this short term approach to business, we would have a different world. Why do we want our companies to share profits better with us (read as higher bonus and more salary) when we are their employees but want them to keep on growing and giving us maximum profits when we are their shareholders? I can think of greed as an answer...I have written on greed many times but the more I think of it, the more I am convinced that this one attribute of mankind will take it towards destruction. Budhha mentioned this over 3000 years ago and we are struggling to find a solution to this. We live off this earth and we exploit her. We live at the cost of all other living beings on this earth. We need to find a solution. Every leader owes it to this planet. Can we start by treating Corporate Social Responsibility not as an activity? We could push our companies to start looking at themselves as part of the society in which they do business and, therefore, work towards the collective good of the society.
