Summary: In this post, I argue for an explicit recognition of the need for a greater involvement of business in society. Business leaders, shareholders and investors need to respond to societal expectations and maintain the fragile balance of both wealth creation and employee welfare. This can only be done through the sustainable development of a ‘Culture of Respect and Trust’ between employers and employees.
By improving people's working lives, we'll ultimately improve society too
Would it be fair to describe (and treat) employees as commodities? We all agree that a commodity is a basic good used in commerce. It is ‘interchangeable’ with other items of the same type. There is little differentiation between commodities originating from one producer and those coming from another producer. Commodities are just used as standard inputs in the production of goods or services. So, the answer is ‘NO’ - employees are not commodities and should not be treated as such!
In our current consumeristic and throwaway culture, unfortunately, I notice that more and more organisations tend to treat their employees as ‘disposable commodities’. They can be exchanged, moved around and replaced with ease and at any time. Some may disagree and say, nowadays there is a deficit of talent, it is very difficult to recruit the right talent, but I don’t feel this is the case. The reality is that many companies do not want to invest in employees at all and expect them to land running in their specific job roles, fully trained, qualified and experienced. Organisations want employees to add value from day one at the minimum cost possible. They want to benefit from the employee’s own personal and professional development and investment, without any intention of contributing to their further professional growth. Once the ‘commodity’ has been squeezed to the maximum and is obsolete, then it can be ‘exited’ from the organisation and replaced with a fresh recruit. They claim employee turnaround is necessary and healthy for the growth of the organisation... of course it is, but at the expense of the employee.
So the belief that business is a ‘force for the good of society’ is being challenged. Businesses are being held accountable for the impact of their actions on employees and society. The conventional view, that if businesses stick to the law they need not concern themselves with the welfare of employees and wider societal goals, is popular, but is also now being confronted.
Nowadays organisations are required to take socially-centred positions that are neither the most profitable or safe, nor the most popular among shareholders, but must be taken because these are, ethically and morally speaking, the right thing to do. The ultimate test of organisations may be their willingness to sacrifice something today for future generations of people whose words of thanks might not be heard now.
Employees are our greatest asset?
The impact of such short-sighted business decisions is deplorable. It is disturbing to learn about the ordeal of many employees via their organisational survey feedback. The stress and anxiety of some employees is palpable in their verbatim comments: ‘I need to pay the bills, my mortgage, I have kids to maintain, inflation, the cost of living squeeze, I live in a shared bedsit, my commute to work is over four hours every day, my line-manager puts too much pressure on me, no recognition, higher workload, repetitive boring job, I can’t go on like this’, and so forth – these employees have no other option, they must keep their heads down, stay quiet, and keep going forward without protest, if not for themselves, then for their families. They have been institutionalised: work, eat, sleep… work, eat, sleep… how can you expect employees to be fully engaged under these circumstances?
So I ask business leaders not come to me with the overused cliché ‘Employees are our greatest asset’ – in the real world for many this is not the case anymore (of course, with the praiseworthy exception of some few progressive and well-respected organisations that noticeably excel in all aspects of social responsibility - we all know who these are).
Unfortunately, in most workplaces, the employee is not at the centre anymore, money is. Employees are easily cast aside by their employers if they feel employees don’t yield to what is expected of them. The employee becomes a thing, no longer considered a person, but a number on a spreadsheet.
Does this mean that ‘deep pockets’ and ‘empty hearts’ rule the business world? The answer seems to be yes; nowadays many employers dismiss employees with seeming disregard for the impact upon their lives. As long as the termination is not considered illegal, they don’t care if it has devastating effects upon their employees’ lives and that of their families. Who cares if termination adversely affects the employee’s self-esteem, self-image, mental health and general welfare. It is not the employer’s problem, organisations are there to make money, full stop, right?
When it comes to redundancies and job cuts, trust in business is at an all-time low. When the pressure is on and shareholders demand ‘more’ profits, the first ones who are shown the door are the employees. Yes, while businesses have responsibilities to customers, employees, suppliers, and society, in the end, its allegiance is to its shareholders. So, all those wonderful social corporate missions, values and behaviour statements on company websites, the objective incorporation of environmental and social considerations into business operations and decisions, simply pay lip-service to the over-trumpeted and very much misunderstood concept of corporate social responsibility (CSR). Good should be for everyone and not only for shareholders.
Companies prosper at the expense of employees
At the moment, the balance between delivering financial results and appreciating the work of employees is not right. There is a wide perception that companies are prospering at the expense of employees and the broader community. The objective of some businesses is to make people work as hard as possible for the lowest feasible remuneration. According to them, that is the magical combination for business success. How can we become even more profitable? Easy, lets reduce the workforce and make the remaining employees work extra hours. Let’s maximize the utilisation of ‘human commodities’ to obtain more profits.
Today in some instances, we tend to see small scale ‘dictatorships’ in the workplace. In the archaic views of these organisations, people should be thankful to have a job. These employers can be easily recognised by the tone of their employment contracts where employees are asked to waive all their employment rights in favour of the employer.
This situation translates into their predisposition to get rid of employees without any notice or explanation (especially in their two first years of employment) if the individual does not seem to ‘fit in’ i.e. does not generate ‘immediate results’ or is ‘too old’ or if his or her questions ‘rock the boat’ – he or she can be out of the door with very little notice. We can see the dehumanisation of work; employees are now interchangeable, replaceable, dischargeable. They are forced to culturally assimilate and stop being themselves so as to fit into an artificially shaped culture.
This disorder is more prevalent among low qualified jobs, among unskilled and semi-skilled employees, who have only a basic level of education/training. They are disadvantaged in three ways: their employment options are limited, they tend to be restricted to certain types of jobs and they have fewer opportunities to participate in training, so they are more prone to ‘Wage Theft’. They also suffer because firms now outsource and relocate (off-shore) this type of work and business support functions abroad, where labour is cheaper. Yes, let’s exploit people somewhere else, everything is about cutting costs and maximising profits.
No need to say that this situation also affects older employees. They suffer for having become too expensive, so they are simply replaced by more ‘exploitable’ individuals, who are ‘cheaper’ to hire, younger, more docile, obedient, with no family responsibilities, and willing to work and travel 50+ hours per week without complaint.
These ‘cost-conscious’ employers are foolish to disregard the talent of older workers (i.e. over 50s). Older workers have the experience, have a more in-depth knowledge and greater understanding of the business, have stronger business networks, know how to behave in challenging situations, are more skilled at problem solving, they make fewer mistakes, require less training and even mentor younger employees, they are more loyal (they are not job-hoppers), among many other advantages that they bring to the workplace. Employers should not stereotype based on old age… nowadays over 50s are at their peak!
The purpose of the corporation must be to create shared value, not just profits
It seems the true role of business organisations in society has been completely forgotten. Businesses are supposed to be the cornerstone of employee prosperity in society. Employers are to create the resources that permit social development and welfare for all their employees and community at large. Business leaders recognise that the social awareness and demands of the local communities in which their businesses operate are becoming more pervasive and relentless.
This is not surprising; the world population currently stands at around 6.5 billion people, and it is estimated that by 2050 our population is expected to increase to more than nine billion. It is simple - there are more needs and desires. In this respect, business organisations have certain responsibilities towards society at large: protection of the environment, reasonable use of resources, prevent congestion in cities and the development of economically backward regions, philanthropy and provision of financial assistance for good social causes, and finally, and most importantly, employment generation and reservation of work for weaker sections of society.
Whenever we talk about corporate social responsibility (CSR) everybody immediately thinks of the “big players” - the FTSE or Fortune 100 companies - who have the resources and capacity to invest in their staff and external social related efforts. Let’s not forget that a majority of companies out there aren’t big and social responsibility is still also for them. It doesn’t matter if you manage a business with 10 employees, 5,000 employees, or 50,000 employees, the wellbeing of employees is the responsibility of all employers, small and large.
It is the time to shine for all our HR professionals
The HR profession needs to take a more leading role in deciding the direction of organisation’s CSR strategies. HR is only taking a supporting role, but it ought to champion it. The HR profession has an excellent opportunity to take a leadership role in employee-related CSR initiatives.
HR professionals should not allow people related-decisions to be influenced solely by business pressures aiming to maximise profits with the sacrifice of employees; morality and respect for people should precede any business financial pressure. HR professionals need to care about employee wellbeing and not simply defend the employers’ business interests and targets.
HR is ideally placed to gauge organisational culture, understand it and change it. HR needs to make sure people management practices are ethical. They need to offer people the right support and training necessary to embed CSR principles into the minds of business leaders, managers and employees in the organisation, to embed ethics into the organisational culture.
In today’s increasingly ‘ethical’ world, there are very few HR departments that are not required to get to grips with CSR. They need to help reposition the role of business in society. They need to encourage management to use business as a force for good in the communities where they operate.
HR professionals need to help business leaders to respect their employees’ contractual working hours, help them rediscover the meaning of free time and leisure for their employees, that of idleness and gratification. People who work must be given time to relax, to be with their families, to enjoy themselves, read, listen to music, play a sport. Work should anoint a person with dignity.
Every employee has a right to expect that they will be treated fairly by their employer, and that the employer will act in good faith. This includes not terminating employment without a good and valid reason to do so. However, because of the competitiveness imposed by a consumer society, work ends up dehumanising people. When work does not yield to healthy leisure, to restorative rest, then it enslaves the employee, because then employees are not working for dignity, but to compete.
This situation eradicates employee wellbeing and negates the intention of work. The HR function in any organisation must make sure employers offer fair contracts and working conditions to employees and guarantee these are respected. HR professionals are there to help build a better society by creating a culture of respect and trust between employees and employers, thus supporting organisations transform their workplaces for the better.
Creating a culture of ‘Respect and Trust’
Trust is the defining principle of great workplaces and is created through management’s credibility, the respect with which employees feel they are treated, and the extent to which employees expect to be treated fairly.
By developing respect, trust and engagement in the workplace, we can change the quality of work life for all employees. The key to creating a great workplace is not a prescriptive set of employee benefits, programmes and practices, but the building of high-quality relationships in the workplace — relationships characterised by pride, purpose at work/sense of mission, honest communications, camaraderie and fair treatment.
Creating a ‘Culture of Trust’ between business leaders, managers and employees (and also providers and customers) is not only the right thing to do but also an organisation's strongest competitive advantage. Based on the growing body of research-based evidence, we know that organisations that build trust and engagement create workplace cultures that deliver sustainable and outstanding business performance. Business leaders need to concentrate on long term value and not short-term numbers/quick profits.
The most successful workplace cultures are built on trust which is a key driver of employee engagement. Measuring the pulse of your workforce on these matters is crucial. Organisations need to regularly assess their workplace culture by measuring the levels of both employee trust and employee engagement in the organisation so as to take timely corrective actions.
Yet, as discussed, due to financial pressure and potential greed, many business leaders and managers unwittingly damage the relationship they have with employees which can often be the cause of peoples’ stress, overwork and ill health.
There are well-defined ways in which leaders and managers can create an environment characterised by a culture of respect and trust by:
- Showing honesty and integrity in carrying out its business vision and all business dealings, not only with employees, but also with clients and providers, in a consistent way.
- Encouraging open and transparent two-way communications which are accessible to all members of the organisation at all times.
- Demonstrating care and competence in co-ordinating human resources and allocating material possessions fairly.
- Guaranteeing balanced treatment, inclusion and equal opportunities for all employees, in all aspects of their work life, and not only in terms of pay and benefits. Organisations need to ensure justice in this respect by providing robust internal processes for appeals.
- Supporting professional and personal development for all employees by offering relevant training and ensuring lack of discrimination and absence of favouritism in all hiring and promotion processes.
- Recognising individual contributions and showing appreciation for the work being offered to the organisation. Ensure managers do not treat employee contributions as a simple business transactions. Encourage the practice of generosity in all interactions with employees; there needs to be a genuine sense of respect and caring for employees.
- Respecting each employee’s ability to be themselves and caring for them as individuals with personal lives outside work.
- Allowing employees to collaborate and participate in relevant decisions that affect their work and wellbeing.
- Promoting a socially friendly and welcoming work atmosphere with a clear sense of community, team and family feel.
- Providing purposeful and fulfilling personal jobs that directly align to the wider mission and strategy of the organisation and which have a positive impact on society and the environment.
I strongly believe that by following these directives and thus cultivating a ‘Culture of Respect and Trust’ every organisation can become a great workplace, and by doing so, improve the quality of life of all employees and society at large. Promoting a culture of respect and trust in the workplace is like signing a human contract with the wider world and generations to come.
Some final thoughts…
This is a call to business leaders, shareholders and investors, to keep the human component central to all their business decisions, to realise that employees bring their whole selves to work every day, for the success of their organisations, and this should deserve everybody’s recognition and respect.
Business leaders, shareholders and investors need to be more aware of the impact and consequences of how business objectives are currently being achieved, and at what cost. They need to shift their business focus from a strict corporate wealth generation effort to a more ‘people and community’ centric orientation. Employees need a better balance between wealth generation and their welfare. I am not saying business leaders, shareholders and investors should forget about their organisation’s purposes, but should not make the mistake of ignoring the aspirations and hopes of their employees.
Some business leaders still think that the only mission of business is to ‘compete and win’ - anything except making money is a distraction. Some routinely assert that their responsibilities to society do not extend beyond the constraints imposed by law and regulation, and that their obligations to their employees and customers are essentially incidental to their main objective, that of making money!
This sort of thinking is wrong; business has a higher purpose than solely generating profits. It does not operate in a vacuum only within the context of commerce, but is an integral part of society. Nowadays, businesses are being evaluated as successful if they have effectively adopted an approach that combines decent returns for shareholders along with a pronounced emphasis on social and environmental performance.
Business leaders, with the support of HR professionals, need to recapture the moral high ground from their critics. There needs to be a shift in business, from focusing on the bottom line to having a positive impact on society. Treating employees as commodities and only concentrating on short-term profit maximisation erodes the trust in business organisations and in their leaders and owners.
Remember, goodness is the only investment that never fails…
Disclaimer: The views expressed in this blog are solely those of the author in his private capacity and do not in any way represent the views of any other entity.
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