Reputation Capital for Survival & Success

We all know that the private sector can play a much larger role than simply providing employment. It has the capacity to finance community programs and expertise to find innovative solutions. Benchmark solutions.

How can we get there? One option is by inviting multinational companies to operate in India. They bring in better human rights; plus environmental, regulatory and anti-corruption practices to countries they operate in.

But why would they want to do it? Simply put, because the fortune is at the bottom of the pyramid.

There is a case for good governance and CSR along each of the four Vedic tenets of management – profit, price, penalty and differentiation:

• Contributing to education and community programs helps develop new markets as more people shift above the poverty line.
• Increasing public knowledge and media attention on the effects of irresponsible economic activity such as climate change, environmental damage, corruption and human rights violation have forced companies to make amends. Companies are now aware that they have to build “reputation capital”.
• Various studies across countries indicate that consumers are willing to pay a higher price for products from a company that has invested in community programs or green technology.
• Globally, regulatory systems are being tightened and given more teeth. Financial, environmental or human rights violations are punished severely.
• Lastly, it is becoming increasingly obvious that competing on price alone is not a sustainable strategy. Indeed competing on quality is a far better differentiator in the long run.

I believe we have a few groups of Indian organizations that fit the bill. Several more are in a state of metamorphosis. It is time to recognize those that are above board on their CSR. Commencing 2014, Qimpro Convention offers an option to showcase worthy practices.