Santiago F. Dumlao Jr. l January 3, 2024 l Business Mirror
To advance beyond noble intentions, some business leaders are actively promoting the “Covenant for Shared Prosperity” to be signed by business organizations and companies. Sure, it’s still commitment in words but there will be the conscious effort to monitor each other’s pledge and commitment, to be accountable for some specific results, to be honorable in one’s own voluntary declaration.
The Covenant frames and synthesizes the overarching problem of our Philippine Society today in this way:
“We realize that our country, like many other countries around the world, is suffering from gross inequality not only in economic and financial terms but also in the social, environmental and political aspects of our national life. This gross inequality in our Society has been with us for generations fueled by greed; illegal and unethical practices; callousness to the needs of our communities, especially those at the bottom of the Pyramid; and indifference to Mother Earth by some among us. We look to end these practices.”
Beautiful words that lead to nowhere, some hecklers will say. And of course the cynics will always be cynics, even sarcastically dismissive.
But I think we have hardheaded single-minded proponents here, so they continue to declare:
“We believe that a way to address inequality in all its forms in our society and to enhance the dignity of human beings and, thus, achieve inclusive development is for our organizations to collectively mobilize our human, technical, economic and financial resources to ensure ethical wealth creation and the sharing of prosperity with all our stakeholders.”
And who are these stakeholders? In accustomed analytical approach, these business leaders have identified them:
1. Employees
2. Customers
3. Suppliers
4. Community
5. Environment
6. Stockholders
In a recent workshop, specific action commitments were established for each stockholder group, metrics were developed to measure performance towards commitments and against identified benchmarks and target compliance dates were self-imposed.
For example, to implement shared prosperity with Employees, the Commitments are:
1. Recruit, train and develop our employees and managers to be the best they can be irrespective of gender, alma mater, age, ethnicity and religion;
2. Provide just compensation and benefits;
3. Promote meritocracy;
4. Encourage work-life harmony.
The Measures are:
1. Allocate 5 percent (the benchmark) of total people cost to training;
2. Have a “Performance Evaluation System” based on performance scorecards (the benchmark);
3. Develop an “Employee Satisfaction Index,” making a semestral survey (an effective feedback mechanism);
4. Establish compensations levels equivalent to a Living wage for employees receiving below P30,000 a month.
Yes, there is specificity in commitments and practical guidance for implementation, for each stakeholder group.
Will this approach work out successfully to meet the expectations of proponents? My answer is, it can. I do not underestimate the power of single-minded conscience- driven business leaders.
The “Covenant for Shared Prosperity” was launched by the Management Association of the Philippines (MAP) and 25 other business networks—the Financial Executives Institute of the Philippines among them—in November 2020.
As an end-note, I noticed during my participation in the workshop that shared prosperity was usually equated with economic prosperity, meaning, personal well-being in a material sense, i.e., food, shelter, clothing, employment, economic opportunity and money.
But what about such intangible but very real “state of prosperity” as justice? Prosperity is the human condition of “freedom to be oneself,” the condition of equal opportunity to enjoy one’s basic human rights. As basic as food, water and shelter, is justice—access to justice and equal treatment under the rule of law.
I continue to hear reverberating in my ears, something I heard at PCP II (Second Plenary Council of the Philippines) years back: “Our greatest problem in the country is not poverty. It is injustice.”
Something to think about and ponder as we start the year 2024. Introspectively. Heedfully. Hopefully.
*** Santiago F. Dumlao Jr. is the Secretary General of the Association of Credit Rating Agencies in Asia and chairman of the market governance board and market policy committee of the Philippine Dealing & Exchange Corp. His views do not necessarily reflect those of the BusinessMirror’s.