Transformative change: The imperative of inclusive growth

Many companies often articulate that “business must do well in order to do good.”

The question is, how long will “doing well” take? At what rate of profitability will “doing well” be defined? Will there ever be a time when the yield will be enough?

In other words, how will the benefits from the fruits of having done well finally be able to “do good” so that it will help provide relief and upliftment to those in dire conditions?

These are questions that beg to be asked as CEOs chart the paths of the organizations they lead.

These are the questions better asked as a form of self-examination rather than as a demand from discontented public.

These are questions whose answers should form part of the “treatment” not as mere palliatives designed to appease.

Business operates amid a pervasive social consciousness that demands accountability for what it does and what it does not, for what it commits and what it omits.

The call of the times is not only for change but true transformation. It is letting go of the mindset that the one who provides the capital is the only one who will be entitled to its gains because those who made those gains possible—the consumers of the products and services—are also stakeholders.

Transformative change recognizes that inclusive growth is imperative because failure to broaden the opportunities will eventually retard the business and the economy.

Inclusive growth means being able to expand the benefits derived from economic gains and progress to include its intended beneficiaries—ordinary people who cannot rise above the poverty threshold because they do not have access to livelihood, education, health and subsistence.

For inclusive growth to happen, all sectors of the society need to make meaningful contribution.

Because of its access to resources and opportunities, the private business sector is expected to take the lead in bringing about such inclusive growth.

The responsibility may seem overwhelming, but only because we tend to think in terms of how many more jobs we can generate, how many more schools we can build, scholarships we can extend and medical missions we can carry out.

Inclusive growth can also be as simple as being satisfied with that reasonable percentage of profit the business (and its investors) need, to keep the company going and growing and “give back” the rest to the consuming public maybe in the form of less price they have to pay for those services and products.

It is such a rarity for a company to voluntarily cut its prices; and more often than not, they do so because of public pressure.

Nevertheless, transformative change is a tide that cannot be turned.

Already, we are aware of the gains posted by “social purpose businesses” (SPBs) that are able to make a social impact, generate social value and achieve profitability.

These are organizations that are able to build and redefine their business models into “doing well by doing good.”

A 20th century American writer and humanist Kurt Vonnegut captured the essence of this major paradigm shift: “We have to continually be jumping off cliffs and developing our wings on the way down.”

There are encouraging signs.

New leaders are emerging and they are finding creative paths not just to respond to the need for change but to capitalize on these changes to engage markets and make the growth more inclusive.

The IBM Global CEO study tracks these changing priorities and reports how priorities have changed among leaders over the years.

Brands now seek not only to shape behavior but to also inspire people because it is able to deliver more value to the society from multiple touch-points—through the quality of the products and services, through a genuine partnership with the people they employ, through transparency and consistent ethical standards, through the conscious choices they make that protect and conserve the environment, and through the willingness to be accountable for its performance.

Innovation is serving as a catalyst to enable transformative change and inclusive growth.

There are stories of innovations successfully pursued by leading companies where the fruits are shared with bigger and wider population.

Steps are being taken to partner with communities, encourage entrepreneurship and open up opportunities for them.

The national initiatives to build tourism momentum are expected not only to provide jobs but to instill a strong sense of responsibility to make the developments of destinations sustainable.

Education can create understanding, appreciation and informed, active participation in development.

The biggest hurdle is getting people—the ultimate beneficiaries of transformative change—to trust again the institutions that repeatedly fail them.

The challenge is restoring hope, confidence and optimism that benefits will cascade down to the most marginalized members of society, that lives will get better and that there is a bright future that everyone can look forward to.

Transformative change can happen if we will have the courage to lead and the humility to be led.

It can happen if we have the willingness to work for the greater good rather than just for ourselves. It can happen when we engage not only our minds but more so our hearts.

Transformative change can happen when we can reaffirm our faith in the human spirit.

We invite you to come and join in the more in-depth discussion of Transformative Change: The Imperative of Inclusive Growth. This is the 10th International CEO Conference offering of the Management Association of the Philippines (MAP) to be held on Sept. 11, 2012, Tuesday, from 8 a.m. to 5:30 p.m. at the Rizal Ballroom of the Makati Shangri-La.

The sessions will feature presentations such as Building Bridges for Transformation Through Education; Capitalizing on Imperative Change: A Top Priority of Business Leaders; Tourism: Building the Momentum for Inclusive Growth; Branding Value and Valuing the Brand; Transformative Change: The Courage to Lead, The Courage to be Led; and Innovation as a Catalyst for Transformation and Inclusive Growth.

The keynote speaker will be Dr. Jesus Estanislao, chair of the Institute for Solidarity in Asia (ISA) and the Institute of Corporate Directors (ICD).

For reservations/inquiries, please visit www.mapceoconference.ph or contact the MAP Secretariat via 751-1149 to 52, [email protected] or [email protected].

(The author is a member of the MAP CEO Conference Committee, chairperson of the MAP Health Committee and president and CEO of Health Solutions Corporation. Feedback at [email protected]. For previous articles, visit www.map.org.ph.)