With much of the world in the midst of a second wave of Covid-19 cases, and despite the encouraging recent news about vaccines, the pandemic continues to pose significant challenges to how we live, how we do business and how we interact personally, locally, nationally and internationally.
The long-term effects are likely to bring countless businesses, both large and small, to the brink of failure. Economies will be decimated, and it will be a particularly harsh environment for young people looking to start their working lives.
With vast numbers of people around the world losing their lives to the virus every day, and emotional well-being jeopardised, the economic ramifications could arguably be considered a secondary concern.
But if there’s one thing we know for certain, it’s that the pandemic involves a number of things all happening simultaneously – a health catastrophe, an economic crisis, and a challenge to governments and public policy to respond to that crisis while at the same time maintaining the trust and confidence of citizens.
Questions of competence and confidence are being laid at the door not only of our political leaders, but our business leaders as well. Covid-19 is also testing what constitutes truly responsible corporate behaviour.
There has long been a perception of global business, confirmed by academic research and surveys, as being overwhelmingly self-interested, prioritising own objectives to the detriment of societal goals. In Britain, for example, the majority of the public believe that the profit motive represents “an actively malevolent force”.
With public perceptions of business so low, empty talk coming from boardrooms about commitments to environmental, social and governance (ESG) goals risks exposing a clear credibility gap.
Those using platforms such as the World Economic Forum to issue calls for more sustainable and responsible business practices must also ensure that such calls amount to more than just meaningless soundbites.
If companies are to have any hope of bridging the credibility gap, how they respond to the pandemic will be crucial. The crisis tells us two things that should determine their response.
The first is that it is not about a single issue. The health crisis is linked to many other concerns relating to economies and livelihoods, mental health and well-being, inequality and social divisions.
Companies need to create integrated strategies to protect but also enable individuals, recognising the comprehensive nature of the threats that people are facing. And they need to deliver these responses at grassroots level, within communities, responding to specific local conditions.
Secondly, the crisis has highlighted the importance of collective action between companies and government, involving community organisations and learning from international experience. How companies deploy their resources in terms of skills, logistics, information and ingenuity, not simply cash, will define social responsibility for decades ahead.
If companies fail to turn these attributes to addressing vulnerability, while also preserving opportunity, then warm words about sustainability and corporate responsibility will exist as little more than evidence of the disconnect between business elites and the real world.
One way of thinking about sustainability is delivering “human security”, meaning working with people to protect them from harm, and helping them to lead tolerable lives. Whether the challenge is adapting to climate change, transforming the local economy or helping stem a health crisis, close, constructive and continuous relationships between business and communities help to navigate those changes.
In a “human security contract”, business and the community support each other and achieve results which benefit both. This is the guiding idea behind the human security business partnership framework developed by LSE Ideas, a foreign policy think tank at the London School of Economics, in conjunction with the United Nations.
The framework provides goals, processes and tools to guide companies to establish partnerships with communities and governmental bodies, in which partners’ needs and risks can be identified and mutualised. A greater focus on human security, and how to collaborate effectively over the long term with local stakeholders, will enable business to press reset on what we have come to think of as corporate social responsibility and ethical business.
Three concrete ways in which companies can re-orientate are to gear collaborations towards three Ts: building trust, helping people to become more resilient through training, and smart use of technology to deliver both protection and new opportunities in both the workplace and the home.
There are undoubtedly lessons in this crisis for how businesses can contribute to help create societies that are economically and socially stable and resilient. Post-pandemic, there is hope that more businesses will examine how to align their goals with that of communities – not jettisoning profitability, but recognising the gains from forging new relationships where both parties benefit.
It’s in their interests to do so, to rebuild the perception society has of business, and to create a climate in which business prospers through minimising social and financial risks as we move out of the immediate crisis.
There are countless examples of private sector organisations that have stepped up to the challenge of Covid-19, realigning supply chains, resources and processes to bolster efforts to stem the virus, as well as support the communities around them.
These organisations have demonstrated that they are capable of rethinking business and social engagement models. As societies around them reorient their priorities towards sustainability, security and resilience, it will be up to businesses to do their part – or risk becoming another casualty of Covid-19.
Dr Mary Martin is a senior policy fellow at the London School of Economics and director at the UN Business and Human Security Initiative, LSE IDEAS