Companies should help countries to become more stable places
to do business, says Martin Summers
The long-term prosperity of many countries depends on their ability to
move away from ‘crony capitalism’ – where companies succeed by having
the best connections and offering the best bribes rather than the best
products – to market economies based on open and fair competition. This
requires not only the elimination of corruption, which is rightly high
on the CSR agenda, but also the development of frameworks that support
rather than suppress markets, which is not. It’s time for corporate
responsibility to embrace a sustainability agenda for market economies.
This vital institutional dimension to economics, rather than just the
free play of the invisible hand and the absence of state control and
ownership, was recognized by the Commission for Africa. Its
understanding of governance as ‘the right economic, social and legal
framework which will encourage economic growth and allow poor people to
participate in it’ is equally valid beyond Africa’s borders, as is its
conclusion that ‘the issue of good governance and capacity-building [to
make governance systems work] is what we believe lies at the core of
all of Africa’s problems’. Good governance is fundamental to
sustainable economic and democratic development.
If poverty reduction and economic sustainability are legitimate CSR
objectives, then surely companies should champion and invest in
governance in this wider sense. This dovetails with the human rights
agenda because the institutions and practices required to safeguard
such rights, such as the rule of law, an independent judiciary and
professional law enforcement, are the same ones needed to enshrine and
protect private property rights, enforce contracts, achieve redress and
act as a check on governments – all fundamental for dynamic market
systems.
Enlightened companies should take up the cause of good governance,
raising awareness and, where appropriate, investing in it. This could
be done by supporting institutions (civil service colleges,
universities, think-tanks) and programmes to inform, educate and train
civil servants, politicians and judges so that they too can promote and
demonstrate good governance. And it could also be done by helping
these same people build systems of law, administration, enforcement and
service provision that serve the cause of democracy and efficient
market economies.
A good governance agenda for CSR should unite sceptics and advocates
alike, demonstrating that business has the vision to focus on the
institutional conditions that facilitate not only long-term commercial
success but also the economic and democratic sustainability of the
countries in which they operate.
Martin Summers is international social accountability manager at British American Tobacco. He writes in a personal capacity
