11 Sep 2020 20:40 IST

Measure your company’s impact on people, not just profit: Arun Maira

Unravelling the former Planning Commission Member’s five point recipe for a sustainable governance model

“Science is a way of thinking. Nature is a way of being. Scientific thinking breaks reality into many parts and nature brings things together to create life,” said Arun Maira, a former member of the Planning Commission, former Chairman of Boston Consulting Group, India, and author of Listening for Well-Being: Conversations with People Not Like Us.

Arun Maira delivered a talk, ‘Covid and the new normal in governance,’ organised by Madras Management Association (MMA) in partnership with Konrad-Adenauer-Stiftung, in which he came down heavily on the flawed model of governance that many nations have been following, linking economic growth to merely the GDP and stock market performance, neglecting sustainable development.

The European Enlightenment of the 17th CE broke knowledge into silos and specialised disciplines, in which one got to know more and more about less and less, he said. Today, we have fragmented our world by ‘narrow domestic walls’ through our self-centred thinking and actions. He also lamented the soil problems and changing local climate in some places because of the excessive scientific management of nature.

India fared poorly on the Sustainable Economic Development Assessment Framework (SEDA) which takes into account factors such as environmental care and inclusion of all the people in the nation’s economic growth, he pointed out.

Covid brought life to a standstill

According to Arun Maira, for the last 15 to 20 years, the privileged few in India were comfortably seated in the bus of economic growth, travelling along merrily in the fastest-growing, free-market democracy in the world. The bus was sometimes slower but nonetheless moving well. Those inside the bus were even served French wine and Swiss cheese. Then the bus came to a screeching halt as Covid wreaked havoc around the world and people clung onto the roof of the bus and spilled all around in the streets. Tragically, those inside the bus were not even aware of their co-passengers who fell down, he regretted.

He gave his recommendations for effective governance in the new normal which revolved around five major aspects — metrics, systems thinking, listening to different people, changing the theory of change, and the poorest person first.

What we measure is what we manage

The Boards of companies have been keeping their eyes on profits and shareholder value way more than necessary. They need to put in place more indicators in governance for assessing the impact of the businesses on all stakeholders and the environment, and look at them every day, just like they look at the profit and share price.

The government too needs to keep its eyes, not just on GDP, but on the well-being of all citizens, as well as nature that sustains us all.

Unfocus

Our crisis solutions are far too focussed on the problems, resulting in solutions in one part of the system damaging other parts of the system. For instance, focussed care for Covid has led to laxity in caring for people suffering from many other health problems.

Lockdown to combat the pandemic has led to the economic crisis and migrant labour problem. It has caused schools to be shut down. Now, all over the world, there are big alarm bells ringing about the effect of interrupting children's education and how that is going to impact their lives in the future. We must look at the future consequences of our actions taken today. Systems thinking requires us to unfocus, to see the whole forest and not just count the trees. We have to see the relationships between parts of the systems.

Listen to different people

We relatively listen more to people who speak our language and who think like us. On social media, we are compelled to be surrounded by people like us, as the algorithm is designed that way. We don’t listen to people who are unlike us. Let's get out of the bus and listen to them.

Change the theory of change

We have to change from the machine-like way of organising and advocate for the nature's way of organising itself. It does not mean we must disappear as human beings with our aspirations and leave it to nature. In the institutions that we invent, we must not overpower nature or exploit it to make more wealth for ourselves and our organisations. If we kill what we are a part of, we will also die. That is wisdom.

The wealth created by a handful of people is not circulating fast enough. They give back some through philanthropy and CSR but it's a very small fraction of their wealth. Rather than prescribing one-size-fits-all, standardised solutions, we need local system solutions to systemic problems at a global level. Change must be bottom-up and not top-down.

Strong central governments and large scale, centralised, private sector organisations take the power away from the people. We need local solutions, developed and implemented by communities, to global systemic problems of health, livelihoods, and environmental concern.

Poorest person first

Gandhiji’s Charkha, the spinning wheel, was a symbol. It was a vision of enterprises by the people, producing things for the people, which were also owned by the people.

We have to think of the poorest person first when we devise new governance and policy solutions. People are not mere numbers. Economists put people into their equations as mere numbers. Poor people are not a burden to be tolerated by the elite.

(The author is a freelance writer based in Chennai, a corporate trainer and a visiting faculty for various B-Schools.)

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