Editorial
sustainability
The big picture and
the bottom line
lord Michael Hastings
I
t is 35 years since Milton Friedman, the the benefits cannot be evaluated simply by end of Then why are big businesses such as KPMG
influential free market economist, said: “The year figures. Company culture, staff morale and becoming so involved?
social responsibility of business is to increase recruitment are all heavily influenced by exactly the It matters absolutely to the ordinary man or
profits.” In the intervening period, especially kind of social influence the UNGC represents. woman in companies today that their firms are
around the millennium, corporates have begun to Statistics show that talented MBAs are significantly effective corporate citizens. The second remit is
sing an adjoining tune, some more cautiously and more likely to consider companies with a strong and that the more profitable and successful an
others more openly. This has affected the way visible social commitment than one without. organization becomes, the more aware they are
businesses see themselves, are seen by the public Lord Michael Hastings of Scarisbrick is KPMG of the privilege and therefore the responsibility
at large and by the top talent that the recruiters International's Global Head of Citizenship and that goes alongside that. A powerful global media
work so hard to attract. Diversity. Heavily involved in social issues has helped us understand the pressure points the
The United Nations Global Compact throughout his career, and a subscriber to the world is struggling with. It’s no longer just about
(UNGC) appears to be gathering momentum and United Nations Global Compact, and others such NGOs bringing pressure to bear, we can all now
Corporate Social Responsibility (CSR), as the World Business Council on Sustainable see issues as they happen. I really don’t think it’s
sustainability and environmental issues have Development, Michael is a compelling champion the case that businesses treat this just as reputation
become en vogue catchphrases for businesses of the role of business in sustainability, CSR and or flag-waving.
In an interview on the KPMG website you
“The more profitable and successful an
say: "The new challenge for us is to develop
a leadership position on things that affect
organization becomes, the more aware they are of
the structure of societies and communities."
What do you mean by that and where does
the privilege and therefore the responsibility that
positively 'affecting the structure...' stop
short of pejoratively 'interfering with the
goes alongside that.”
structure...'?
That’s a good question. I’ll point you towards a
publication issued at the World Economic Forum
in Davos, which we hosted alongside a number of
around the world. As with most UN proposals, environmental issues. In this interview, in Spring other global businesses such as Coca Cola and
opinion is strongly divided. The Ten Principles, 2008, he spoke to TopMBA Career Guide Editor Deutsche Bank, on partnerships we believe
most agree are worthy and, to supporters, necessary. Ross Geraghty about his thoughts on the connection necessary between public and private sectors.
To critics it’s a flash in the pan, a PR opportunity and between the business world and CSR and We did this in order to help implement some
reaction to the bad old days of corporate Sustainable Development issues. of the lessons of accountability, performance,
irresponsibility. Others maintain that as it is non- achievement, efficiency and motivation that are
regulatory, the UNGC lacks teeth and can do little How do you answer the challenges some common now in the private sector to become
more that appeal to the good natures of businesses people raise that CSR is merely a corporate applicable within government structures and the
to adopt the principles. Commentators such as PR or profit-raising venture? public sector. This is a high-level policy way of
David Vogel in The Market for Virtue argue that, If it’s true, those corporates are a dying breed. The supporting, as a well-known international business,
“There is a business case for CSR, but it is much Economist recently produced an excellent 12-page public and government organizations to make most
less important or influential than many proponents document showing quite clearly that very few of intelligence in order to be more effective.
of civil regulation believe.” companies nowadays do this for flag waving or for
In today’s shareholder society there is no reputation. Most companies are actively involved So KPMG is actively involved in helping
question that profits still form a bottom line and in environmental and climate issues, in community create more effective public policy?
there is no indication that a UNGC-supporting development, in recruiting, supporting and Given the significance of the KPMG brand and our
company will be more or less profitable than one developing people in educational and international 130,000 staff worldwide that are highly motivated,
that is not involved. However proponents argue that development programs. intelligent, articulate people, how can we leverage
22 TopMBA CAreer Guide www.topmba.com
MBA_FALL_08_pp_002-065.indd 22 11/8/08 18:09:56
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