Business has a big role in fight for SA’s health, economy
In a 2016 article, Mark R Kramer and Marc W Pfitzer wrote: “If business could stimulate social progress in every region of the globe, poverty, pollution and disease would decline and corporate profits rise.”
This is the kind of approach associated with shared value strategies that seek to deliver value to society while in the pursuit of business profits and financial success.
What business has realised over the years is that the health of a society within which a business operates directly affects the profits that can be made in that society.
Kramer and Pfitzer go on to introduce the concept of Collective Impact which proposes that social problems can be tackled through a co-ordinated effort by all stakeholders.
Emphasising the distinct advantages of business in this coordinated effort, Kramer and Pfitzer write: “They understand change management and the art of negotiation.
“And corporate pragmatism, accountability, and data-driven decision making can cut through the red tape and ideological disagreement that often stymie governments and NGOs.”
Of course, this is opposed to the famous views of Milton Friedman whose 1970 article proposes that the social responsibility of business is limited to its shareholders and the maximisation of profits.
Friedman believed that it was the responsibility of government, individuals, or organisations founded specifically for social progress to deliver social progress.
However, it would seem, reality has taught us a different lesson since Friedman presented his views on the matter.
In a world that has become very transparent because of a well-developed media sector, as well as the access to information that comes with the internet, it has become important for companies to behave like socially responsible citizens.
This is partly because the modern citizen is aware of the overall impact of the activities of business in producing and marketing their products.
Where the overall effect of these production methods or the products hurt society, an image is established that such a firm is a danger to society.
This image has a direct influence on the profits, or lack thereof, that the firm can generate within that society.
This places the views of Friedman firmly in the past.
The increasing demand for a co-ordinated response to social progress, business success and efficient and responsible governance points to a realisation that the associated complexity requires more than a simplistic approach. The Covid-19 pandemic has made every one of our pre-existing problems more complex and urgent.
This is precisely the complexity and urgency which requires a co-ordinated response. However, co-ordination requires leadership, particularly when there is urgency involved.
Unfortunately, the co-ordination required is not the coordination of political interests, it is the co-ordination of efforts to achieve a specific objective within a specific time.
This time that means physical and economic health.
I bet with this type of coordination in place we’d see tangible results pretty soon.
Sandile Zungu, of the Black
Business Council, seems to support the idea of business applying its skills to assist the government to reach its goals.
“Business can mobilise the resources but investors we meet say they lack confidence in the ability of our state to implement things because state capacity is very weak.”
“The expectation is that if business sits at the table and brings in this expertise, there will be better plans and better implementation.”
Our government needs all the help it can get.
It is no secret that the ruling party quite literally consumed state capacity in the last decade.
Caught so unprepared by such a complex set of problems, we need a co-ordinated response which will give a firm recognition to the role of business, the resources, and the skills they carry.
However, President Cyril Ramaphosa needs to act immediately and unleash the vast capacity carried by the business sector particularly in implementing a successful infrastructure programme.
This points to a desperate need to get the economy up to speed while keeping Covid-19 infection rates under control.
The huge opposition to the operation of schools by several teacher unions, among others, does not align with the need to keep children learning, teachers teaching, businesses operating, health-care healing, police policing and the economy working. Instead, a co-ordinated drive to prevent Covid-19 infection should be the focus, driving awareness, Covid-19 safety behavior, and a conviction to deal a blow against poverty through co-ordinated economic activity.
If we succumb to heartfelt but populist ideas to close everything down, we will neither win the health nor the economy fight.
The Covid-19 pandemic has made every one of our pre-existing problems more complex and urgent