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Guest Post, Dr. Kaushik Sridhar, Global Top 100 CSR Influence Leader
Photo by Marius Venter from Pexels
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The world faces numerous seemingly intractable economic, social or environmental problems. Poverty makes lives miserable for more than one billion people. The divide between rich and poor grows greater daily. Global warming and environmental degradation continue unchecked. Fragile ecosystems suffer unrelenting attacks from business and population expansion. Millions of people have no health care, and far too many — young and old — die of preventable diseases. Millions more lack basic human rights. Educational systems worldwide, including in the most advanced nations, fail to provide young people with the tools they need. Students are not receiving the “science, technology, engineering and math” (STEM) knowledge and training that will make them future desired employees. The human costs of these challenges are disastrous.
National borders confine governments and prevent them from solving global problems that transcend political boundaries. Non-governmental organizations unselfishly try to mitigate global and local issues. NGOs are mission-oriented, can be experts in their fields, are admirably dedicated to their goals often, can point with pride to tremendous accomplishments. But NGOs usually lack the financial and political resources necessary to make a lasting worldwide impact.
In contrast, international corporations are well-positioned to take effective action. Corporations uniquely possess the human and intellectual resources, the financial assets, the global footprint, the scalability, and the market power to address and make progress on problems that transcend governmental borders and overwhelm NGOs. Corporations have the necessary resources; NGOs possess the commitment, specialized knowledge, and experience to work on making the world a better place.
Leaders of corporate giants have learned that tackling the world’s problems turns out to be smart business. Corporations that honour the standards that today’s consumers and activists demand — and those that exceed those standards to help solve global problems — win enthusiastic public support, and that benefits their brand reputation and profits. Besides the obvious value of acting as good global citizens, big corporations profit from facilitating solutions to global problems. For example, when corporations help people shift from poverty into the middle class, they expand and maintain their customer base.
The leaders of these firms understand that staggering global problems undermine the world’s economic system. These issues introduce dangerous unpredictability to future supply lines and markets. Consider the dangers of global warming. Scientists know that an increase in the global temperature of only two degrees Celsius will prove disastrous for Earth, yet without immediate steps to alleviate climate change, the world will shoot past this lethal level. Crucial resources — arable land, water, clean air — continue to diminish daily. In the Himalayas, poor people use machetes to battle over the limited supply of wood for their cooking fires — a disastrous consequence of climate change. Other negative effects of climate change include “storms, droughts, heatwaves, wildfires, and other natural disasters.” Global businesses face substantial — and rising — costs from these hazards. Some will find profit-making opportunities in developing solutions, like energy-efficient systems that limit greenhouse gas emissions and mitigate climate change’s most negative effects.
Since the millennium, many forward-thinking businesses regard protecting the environment, improving social conditions, and enhancing financial opportunities for the poor as core components of their “corporate missions.”