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How do you see ‘beyond growth’? This article while highlighting the disintegration between human beings and the ecology due to much accentuation on quantitative financial indicators elucidates some of the envisaged facets ‘beyond growth’. These facets are not illusions but realistic and pragmatically possible options for the corporate world.
What is growth?
Growth in simple terms can be defined as an increase of profits compared to previous year, future ability to generate larger profits, and enhance the market share. However the growth of an organisation will depend on its leadership as well. Very often we read articles in newspapers and other media displaying the growth of companies with percentages, ratios and other various financial terms to please the stakeholders and to demonstrate the growth of the company. Unfortunately the majority of the organisations focus on ‘financial growth’ only as such organisations are managed by a segment that has ‘tunnel vision,’ but nothing beyond.
It can be reliably assumed that majority of the Boards of Directors in Sri Lanka do not discuss the facets ‘beyond growth’ other than the financial indicators, branch expansion, Key Performance Indicators (KPIs), etc. This no doubt demonstrates their degree of concern and the limited knowledge about the environmental aspects and the attributes ‘beyond growth’ which is unacceptable.
Economic view of ‘beyond growth’
‘Beyond growth’ is sustainable development from the economic perspective. Sustainable development is to meet the needs, desires and the aspirations of the present generation or the society without compromising the ability to fulfil those requirements of the future generations.
However critics argue this definition as a weak description and a narrow proposition as it focuses only from the economic perspective but not from the other spheres. Hence it is worthwhile analysing the holistic view of ‘beyond growth’ concept.
Realities of growth
Before analysing ‘beyond growth,’ one has to ascertain the realities of growth. One reality is growth does not make people satisfied. The rational of this statement is that all nations use the Gross Domestic Product (GDP) to measure the growth in an economy.
Companies cogitate sound net profit or growing balance sheet as growth. Growth, in the corporate world is known as profit maximisation but not prosperity maximisation. Prosperity is explained as leading a fulfilled life, rewarding and satisfying employment, human happiness and a pleasing environment. Does growth in the corporate sector fulfil these attributes? The answer is negative.
Ecological limitations for growth
The entire world economy heavily depends on fossil fuel for many activities. It is reported that more than 80 m barrels of fossil fuel are used per day globally. According to research, if the consumption of fossil fuel of this magnitude is continued, the world will have fuel only for the next 30 years approximately. Knowing this majority of the companies do not focus on Research and Development (R&D) in exploring an alternative energy source due to high costs involved or little or no return on R&D, companies do not expend funds even as a CSR project to finance R&D.
The ecology is already demonstrating negative signs of atmospheric changes related to the climate. One ecological limitation is that; at atmospheric concentrations of 350 parts of Carbon Dioxide (CO2), the climate begins to destabilise. We are now at 380 level and we experience unexpected floods, cyclones, droughts etc which would worsen in the future when the atmospheric concentrations of CO2 increase up to the level of one million. Floods, cyclones, tsunamis and other catastrophes are becoming frequent. Hence ignoring the ecology will have unimaginable consequences.
Uneven wealth distribution
Companies need more and more growth. As per a recent Sunday newspaper, 90% of the Colombo Stock Exchange (CSE) is controlled by 10% of investors and the remaining 90% of the investors are responsible only for 10% of the transactions at the CSE which amply demonstrates the unequal distribution of wealth. As per statistics, Sri Lankan GDP has increased two folds during the last five to 10 years, however the poverty level too has increased.
The Joint Managing Director of the ICICI Bank who addressed a professional organisation in Sri Lanka a few years ago stated that the total wealth of the four richest people in the world is more than the total GDP of the 25 poorest nations of the world. These are startling revelations regarding the unequal distribution of wealth from the local and global perspectives.
Adverse effects of growth
There are some possibilities and probabilities ‘beyond growth’. The companies strive to grow and maximise their wealth in whichever the way they perceive and intend to move aggressively in their given domains to achieve their objectives. Some of these aspects which are expounded below are already visible.
Growth disintegrates human beings
Modern day employees have become workaholics. The corporate management members are ‘too busy’ in their cubicles striving to achieve the assigned targets. Team work is hardly observed though the emphasis for same is high and technology has created a smaller world. as human beings, employees are not concerned about the colleagues or teamwork and instead, hunt for opportunities to climb the ladder. Egoism has become the order of the day. This undue pressure to achieve targets, KPIs, growth, has naturally disconnected human beings.
Closer scrutiny of some of the growth rates indicted by the corporate sector exposes that the growth is less than the actual inflation rate in the country. This naturally reflects a ‘negative growth’. But still such rate of negative growth has been recorded by destroying the human relations and an enormous quantum of natural resources compromising the survival of future generations. Is growth through such means worth it?
Destruction of natural resources
Destruction of natural resources means compromising the survival of the future generation. For instance, forest conservation has become a joke. Dolphin and whale killing has become a lucrative industry. Extinction of rare species has rapidly increased. Elephants are killed for tusks. People are crazy over money, wealth, growth of assets – ethically or otherwise. As a result, all natural and aquatic resources are being destroyed. People do not realise the gravity of this destructive trend which further abates the growth and compromises the desires of the future generations.
From the local perspective, companies have a menacing desire to maximise their profits, to record better results than the competitors’ year on year. For an instance, destroying the natural water resources at Rathupaswala in Gampaha is an example. In Anuradhapura, one family out of five suffers from nephro (kidney) related diseases due to high usage of pesticides.
From the global perspective, a Senior Engineer of a Multinational Company (MNC) having realised the risk and the exigency involved in replacing undersea oil caps recommended a proactive measure costing around Stg 9.0 million to avoid a possible catastrophe. The Chairman of this MNC rejected the proposal because expending Stg. 9.0 million would create a negative impact on the bottom-line. Ultimately, the company had to pay a staggering Stg. 900 million as compensation for the catastrophe. 
Unfortunately companies do not realise, by destroying the nature, they destroy the future potential for growth. One may argue, that from the investors’ perspective, recording a better growth would lead to increase in share prices. This is true enough if the Stock Exchange performs as per market fundamentals. In a market, growth of share prices is higher in loss making and default category companies compared to performing companies, without having an iota of attention for fundamentals and ethics, striving to record a higher growth by destroying the natural resources, merely reflects the idiocy. The main objective of all these are to earn short term gains and not to ensure sustainability in the long run.
Disintegration of people with the environment
Today people cannot predict the weather patterns as they have changed dramatically. People stay indoors in temperature controlled offices and hardly interact with the natural world. But the reality is human beings cannot live while being disconnected from nature. Unfortunately, the prime objective has become gaining material goods, acquiring money and wealth. A simple reason to display the extent of disintegration between the human beings and the environment is that the people do not have time to do gardening. As a result, they keep artificial plants in gardens and indoors. Do artificial plants absorb CO2 and release oxygen to protect the ozone layer?
The majority of the companies have still not earned carbon credits. Many have not taken the necessary steps to implement this. This amply demonstrates the poor level of concern towards ecology as well as their incongruence for the emerging ecological concerns around the world.
Health is wealth
Naturally people love to live longer and healthier. Longevity is a definite expectation of any individual. Our great grandfathers exceeded 90 years without so much as a single Panadol, which they never heard of. Today pharmaceutical giants have introduced medicine and drugs not with the intention of curing the sick but to maximise their growth. Companies are involved in ‘need creation’.
Some time ago, one particular multinational sold a stock of contaminated milk food as they did not want to destroy such a huge stock which would obviously reduce their profits. Having consumed contaminated milk food, when the children fell sick, the company came forward and cured such kids by selling medicine through their ‘pharmaceutical arm’. The company was earning in both ways. Wealth was maximised in this instance compromising health.
Now people die at young age. For instance, children suffer type 02 diabetes in the USA, people have unimaginable level of depression, suffer from high cholesterol due to work pressure and stress, children suffer from cirrhosis due to consumption of cola drinks. Companies sponsor TV programs such as ‘Biggest Loser’ mainly due to consumption of junk food which are being made only to add taste without nutrition; as a result, food poisoning and allergies are rampant. People prefer visiting the gymnasium instead of spending time outdoors.
Countries are used as ‘testing grounds’ for generic drugs. Fruits such as papaw do not have seeds and one-day old chicks are transformed to fully grown birds within 45 days by injecting hormones. Hence all these examples directly or indirectly contribute for health issues though the life expectancy is high for any human being. All these are due to unlimited insistence of ‘growth,’ compromising health for wealth.
Having elaborated on the above ecological concerns from the sustainable development perspective, sustainable development alone will not assist the companies ‘beyond growth’. Sustainable development is only one facet. Companies, while adhering to all formal and informal sustainability requirements, will face immense challenges and threats not only to be competitive in the market, but also to avoid threats under already constrained economic conditions.
Hence, naturally, companies have to meticulously formulate strategies moving beyond the given parameters, making it a tedious task at unimaginable propositions. However, if one intends to overcome this level of competition in the future, there will be more facets which are equally important yet will not create any negative impact over sustainable development. These arenas which would positively push companies beyond growth are discussed below.
Eco business
One of the envisaged facets ‘beyond growth’ is eco business. This means that the businesses would heavily depend on environmentally friendly attributes. Companies may have to pursue environmentally friendly ways and means of carrying out businesses. For instance, moving away from the traditional cheque books, passbooks, and monthly statements, invoices with two to three copies and legal documents is a must as paper production leads to destruction of trees and natural resources.
Mobile phones are another viable option with greater emphasis which is already in force to an extent. In an era where mobile phone suffices most of the day to day requirements, marketing for eco businesses would be easier as five mobile competitors have issued 20 million SIM cards in Sri Lanka for a population of 20.7 million. This can even be used in Government departments/organisations as well, refusing the need for physical documentation. One can argue the practicality of this; however these are the arenas one should think about ‘beyond growth’.
Major super market chains such as Wal-Mart operate across the world with Electronic Data Interchange (EDI) systems, in a paperless society with satellite directed communication. This proves that companies can have paperless societies with the help of computers, internet, satellites etc. These are possibilities as the entire world would be viewed as one market. This would further lead to fuel globalisation to a great extent. Usage of hard currency, cross border regulations and the cultural divergence would be minimal.
Needless to say, the required legal systems, secrecy, controls and mechanisms to enlighten and protect the customers would naturally come into force when societal needs demand such requirements.
Psychological capital
Companies have to emphasise on psychological capital (psy-cap) as the Human Resources divisions would be limited to minimal level of work. Closer scrutiny of HR activities in the last four decades reveals how Human Resource Management (HRM) has evolved significantly from administration services to people capital. However during the last five years especially after the recession, the perceived notion is that the attention paid for HRM in companies has drastically diminished though the verbal emphasis for same is otherwise. 
Some of the Heads of HR at multinational companies operating in Sri Lanka do not have the authority even to recruit employees but the brand managers possess such authority for the simple reason that the brand value and the sales are more important. Under such circumstances one cannot expect the HR Division to motivate the employees as most of the Heads of HR themselves are thoroughly de-motivated. Hence enhancing psychological capital would be of immense help for organisations looking ‘beyond growth’.
Psy-cap, in a nutshell, focuses on four areas, namely, self efficacy, optimism, hope and, resiliency. Employees should have the right attitude, inner self motivation, ‘can do attitude,’ inner persuasion to build confidence, exposure and performance attainment etc without the support of the HR Division. This is self efficacy in summary.
Optimism covers being motivated, building aspirations, performing smarter compared to harder, etc. Hope is one’s ‘will power’ and the ‘way power’. Definitely there is a difference between optimism and hope. For instance, companies perform better in the last quarter as hope is there for the employees for promotions and the increments. But why can’t the employees perform the same way in the other three quarters as well? When the targets are assigned, employees are optimistic in achieving them. Resilience is reactive in nature yet a positive strength of an employee. In other words resiliency is an uncanny ability to bounce back from adversity. Employees should have these traits such as resiliency to grasp the reality, believe in confidence and to challenge the limitations.
Companies will prefer both left brained and right brained employees. This is another possibility under the envisaged facets ‘beyond growth’.
[The writer is the Chief Executive Officer of IIHE, a premier and leading tertiary education institute that offers top quality British undergraduate and postgraduate programs in Sri Lanka. He possesses a wealth of hands-on exposure as a banker, management consultant, strategist, and an academic. He has, in addition to several professional qualifications in various disciplines, two Masters Degrees; an MBA from PIM, USJ and Masters Degree in Management from Massey University, Auckland. He is presently reading for his Doctoral (PhD) studies on Corporate Governance.]
Emotional and multiple intelligence
Corporates would be compelled not only to recruit employees with higher level of emotional and multiple intelligence ‘beyond growth’, but also to nurture such psychological traits in employees. Unfortunately these arenas are still emerging. This is yet another envisaged facet. Employees have to be naturally ‘intelligent’ to manage their emotions to properly recognise their own feelings as well as those of others and the interpersonal relationships with others.
For instance, when an employee is frustrated with the job, is he/she emotionally intelligent to appreciate a promotion of a colleague wholeheartedly? The degree of emotional intelligence would be critical to manage highly complex situations, totally unpredictable future, scenarios filled with anxiety, severe pressure for cost reductions, etc. The dimensions of emotional intelligence are depicted on this page.
Multiple Intelligence introduced by Howard Gardner in 1983, would be grossly inadequate to tackle situations ‘beyond growth’. Corporates would not look for bodily kinaesthetic employees but those with higher cognitive abilities, logical minds, ability to envision the future at present, perpetual memory speed, in addition to possessing knowledge over general attributes such as music, sports, politics, emerging arenas, and the naturalist traits. People who are involved in specialised fields or having tunnel vision have the lowest level of MI. Needless to say, when all employees possess EI and MI, the importance of HRM would be minimal. In other words, with the improvement of EI and MI, each employee would be his/her own HR manager.
Paradoxes
Paradoxes are to thrive ‘beyond growth’. Paradoxes are described as a proposition or a statement that looks absurd but apparently true. Many paradoxes are said to be invalid arguments yet still sound in promoting critical and logical thinking.
For instance, the banks at present grant facilities only for trade finance, housing, local trading, pawning, etc., for accepted businesses. But, ‘beyond growth,’ banks will lend and the companies will obtain credit facilities for cloning, make man made jungles for greenery, decrease of hard currency usage even for trivial payments, increased number of mobile banks and mobile corporates without having a proper registered office. Hence paradoxes are a definite facet.
Professionalism
Professionalism traits encapsulate not only gaining paper qualifications, but also the appropriate ethical behaviour, expertise, unmatchable knowledge in many disciplines, continuous professional growth, accountability and competence. Inculcating a passion to learn continuously, exploring the possibilities of acquainting knowledge about emerging arenas and expanding horizons in multi disciplinary professions will definitely provide the required edge as an individual. When all employees have a similar desire to gain knowledge in this manner, naturally, the entire industry will be immensely benefitted.
It is agreed, for instance that having an MBA paper qualification alone is inadequate but possessing wealth of knowledge, application of knowledge and the above stated characteristics of professionalism are also critically important. But unfortunately most of the employees follow an MBA mainly to receive the qualification but not the knowledge. Hence the employers have to be vigilant when recruiting and promoting such employees who have only a paper qualification.
In the past, experience was considered to be the most important element for any industry. But today, when one analyses the degree of competition, especially in comparison with the global trends, all would agree, experience alone is inadequate. Experience is required to improve the internal processes, systems and procedures, improve productivity, work methods, training youngsters, etc. However, undoubtedly, the knowledge, professionalism, qualifications, expertise, application of knowledge are required to design strategic plans, to execute them effectively and also to be ahead of the competitors. Definitely this provides the competitive advantage and some cases the distinctive competence depending on the width and the depth of the analysis and the arenas considered, etc., and how the strategic plan is marshalled for execution. Professionalism and knowledge in this aspect plays a pivotal role.
The knowledge an organisation gains through professionalism is enormous. Multinational companies in other countries recruit Economists with Doctorates (Ph.D) to obtain advice on macroeconomic aspects. But in Sri Lanka, it does not happen. This was quite evident that the multinational banks had the advantage over a particular ‘deal’ about two years ago due to their superior professionalism whereas our position was completely the opposite from the Sri Lankan perspective. ‘Beyond growth,’ professionalism will play a decisive role with more prominence over the arenas of value creation, innovation, strategy formulation, ability to read the future etc.
Another area under professionalism is to inculcate a conducive culture within the organisation, to argue, logically, ethically, and professionally for the betterment of the organisation. This is where, the corporate management and the board of directors will be compelled to possess higher level of emotional intelligence, multiple intelligence, professionalism, gained knowledge and expertise to evaluate the pros and cons and finally to arrive at proper decisions which are beneficial to corporates as well the society. Another envisaged facet would be that the female employees will not have the ‘glass ceiling’ barrier and they would see the sky as the limit. There will be greater percentage of female employees holding top positions compared to the present.
Usage of social media
This facet envisages the attributes where ‘beyond growth’ would flourish. Similar to the way teenagers and the young adults deal with Facebook, senior citizens will also log in to the social network systems and start dealing with the colleagues. ‘Beyond growth,’ all people will have social media networks similar to our e mails today. There will be greater use of e-commerce solutions.
Advertising strategies for the companies will have to be completely revamped with the support of social media. For instance, companies will have every school as a ‘club’ on their websites. And there will be massive e-banners in the sky which would replace hoardings, bill-boards, etc.
Conclusion
Based on the above facets, the diagram on this page has been developed for ‘beyond growth’ as illustrated for the corporate sector as a stepping stone.
This model entails the importance of two key facets, namely the sustainable development (primary factors) and the organisational development (secondary factors). These two key facets are equally important and should exist simultaneously. No single factor supersedes the other. Primary factors represent the economic and ecological sustainability and the importance of carrying out R&D, amount expended to explore new energy sources, earning carbon credit, waste management, careful utilisation of existing resources to prolong the period for such resources, usage, etc. These attributes can be used to enhance the value of the annual reports, and new ways of measuring growth. For instance, companies can indicate in annual reports and newspapers the quantum of carbon credit earned, amount spent on R&D, etc., for the year 2013/2014.
Secondary factors explain about the ‘envisaged’ facets such as eco-business, introduction of psy-cap, level of EI and MI in the organisation using measurement methods, width, breadth and the nature of the paradoxes, extent to which social media is used, etc.
Considering the importance of the economic and the ecological sustainability, companies have to think beyond growth’ constructively without circumscribing to ratios and percentages to measure growth in the real world and the companies functioning within it.
This is therefore an ‘eye-opener’ for all professional organisations to re-visit the criteria to select in selecting companies for various awards. The author fervently hopes, this article would turn a new leaf to measure growth in the corporate sector in Sri Lanka, ‘beyond growth’.
