The World Trade Organisation’s meeting in Seattle coincided with the launch of our report, A New Vision for Business. Both events address similar challenges – how to combine economic growth or increased competitiveness with social and environmental responsibility?
For most of the industrial era, the solution was simple. Grow as fast as possible, grab every competitive advantage and, if you were rich enough, ignore the social and environmental impact. Continuing growth, pressure on resources and social pressures make this type of behaviour harder to sustain.
Smart business leaders know that there is no escape from global warming, social injustice or technological change. They also know that exploitation as a competitive tool is being overtaken by engagement as a source of competitive advantage. Engagement means going with the grain when customers, employees, partners and communities want to better themselves.
This type of positive response to change is, however, the exception. Meetings of businesses to tackle questions of ethics, the environmental, sustainability, lifelong learning usually involve the same firms. Preaching to the converted is the fate of those seeking to move the agenda forward.
A shift is strategy is needed to embed this type of vision into the policies and actions of the majority of companies. The vision is clear. Faced with rapid technological and social change, companies can only compete effectively if they work with their customers, suppliers and partners to meet their wider responsibilities.
One especially important partner was largely absent from these developments. Rather like the ghost at the feast, government was around but unseen. Now, however, notions of positive engagement and partnership play an increasingly important role in shaping relations between business and government.
Tony Blair’s idea of the Third Way is one attempt to articulate this type of thinking. Until now these ideas have lacked a hard, economic cutting edge. The New Vision for Business goes a long way to providing this cutting edge. The steel lies in a shift in thinking about the partnership between government and business.
Both parties arrive with lots of baggage. Governments typically place business into two convenient boxes – nodding donkeys or villains. The nodding donkeys agree with everything while the villains must be regulated into submission. Business is equally unsubtle, seeking to pacify or pillory government.
The waste and inefficiency involved in these positions is no longer sustainable in societies facing increasing competition, rapid change and threats to the eco-system. The Millennium Challenge, however, is to embed this type of thinking across government while extending this vision across industry. The Committee of Inquiry into a New Vision for Business is an important step. Tony Blair, having initiated the inquiry, has responded positively.
Despite this success, getting this far was easy compared with the real task. The firms directly involved are well down the road in meeting the Millennium Challenge but great swathes of industry have not even pulled out the route map. They might pay lip service to lifelong learning, reducing CO2 emissions and partnerships but their operations leave no time for learning, put cost reduction above CO2 reduction and want partnerships on their terms.
The same is largely true of government. Supply chain relationships revolve too often around low prices and late payment. The recent Modernising Government White Paper hardly mentioned ethics.
Leadership, by example, is probably more effective than regulation in producing this type of transformation. The full engagement of government through its policies and programmes is the key to ensuring that this initiative by a remarkable combination of firms meets the challenge of the Millennium.
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