Sunday, June 15, 2008

Trusteeship -- Corporate Social Responsibility

Gandhian economics is essentially the collection of Gandhi's thoughts on various economic systems. Gandhi was not an economist and he didn’t propound any new economic theory. In his time any discussion on economics was centered around two accepted economic systems - Capitalism and Socialism. Both were rigid in their own terms and even today there is no universally accepted economic system that can be uniformly applied over space and time. Every region can have its characteristic economic system which varies with time. One has to take in to account the prevalent conditions; Socio-political, economic and educational status of the people; comparative advantages and disadvantages of the regional economy etc.

Gandhi’s thoughts on economic systems evolved over time and they incorporated the good of both Capitalism and Socialism. A conservative may identify his views when he reads that Gandhi was against the confiscation of private property. Similarly a liberal socialist identifies his views when he reads about non-recognition of private property, social responsibility of those possessing property etc., Every thought of Gandhi may not be relevant today but Gandhian economics is very comprehensive to deal with many present day issues. One such issue is “Corporate Social Responsibility”, which can be traced to Gandhi’s concept of “Trusteeship”.

Corporate Social Responsibility links Corporate Sector to Social Sector.It is becoming more relevant in our society plagued by increasing inequalities between haves and havenots. Corporate Social Responsibility means that the corporate sector, which earns profit through the sale of its goods and services in the society also has some responsibility towards it. This is essential to promote growth with equity and to achieve an inclusive society. Increasing number of industrial houses are taking active interest in the welfare of the employees, their families and society at large. Starting from the provision of basic necessities like drinking water,primary education, health facilities to the development of environment friendly technologies on regional/national or even international scale, they are working in various spheres. In taking up few initiatives, some of them also have enlightened self-interest in mind. They are not only able to advertise their products but are also selling them to the beneficiaries of their activities. Some of them are involved in the charity work like provision of mid day meals to school children. Many of them have their own NGOs operating at ground level,and in other cases they are involving the civil society in their activities.

Reading Gandhi's concept of trusteeship, we understand that he wanted capitalists to act as trustees (not owners) of their property and conduct themselves in a socially responsible way.

Quoting Jayant Pandya from his "Gandhi and his Disciples"

"Believing as he did in non-violence, Gandhi was against the physical liquidation of the capitalists and landlords.Yet their exploitation had to end.This he believed could be done if the landlords and the capitalists acted as trustees of the poor.His doctrine of Trusteeship is designed to work in all spheres of life.Like parents acting as trustees for their children,the government should act as trustees of those who have choosen them to be their representatives in the legislative assemblies. The trustee, by its implications,meant that he is not the owner.The owner is one whose interest he is called upon to protect".

The philosophy of Trusteeship believes in inherent goodness of human beings. It involves the capitalists and landlords in the service of society without any element of coercion. It doesn’t want the destruction of capitalists. Gandhi himself believed that their destruction would result in the end of the workers.

Mahtma Gandhi's "Gospel Of Trusteeship"

Some Excerpts:

I am inviting those people who consider themselves as owners today to act as trustees, i.e., owners, not in their own right, but owners in the right of those whom they have exploited.

Supposing I have come by a fair amount of wealth—either by way of legacy, or by means of trade and industry—I must know that all that wealth does not belong to me; what belongs to me is the right to an honourable livelihood, no better than that enjoyed by millions of others. The rest of my wealth belongs to the community and must be used for the welfare of the community.

The question how many can be real trustees according to this definition is beside the point. If the theory is true, it is immaterial whether many live up to it or only one man lives up to it. The question is of conviction.

It is my conviction that it is possible to acquire riches without consciously doing wrong. For example I may light on a gold mine in my one acre of land. But I accept the proposition that it is better not to desire wealth than to acquire it, and become its trustee. I gave up my own long ago, which should be proof enough of what I would like others to do. But what am I to advise those who are already wealthy or who would not shed the desire for wealth? I can only say to them that they should use their wealth for service.

As for the present owners of wealth, they will have to make their choice between class war and voluntarily converting themselves into trustees of their wealth. They will be allowed to retain the stewardship of their possessions and to use their talent, to increase the wealth, not for their own sakes, but for the sake of the nation and, therefore, without exploitation.

When the people understand the implications of trusteeship and the atmosphere is ripe for it, the people themselves, beginning with gram panchayats, will begin to introduce such statutes. Such a thing coming from below is easy to swallow. Coming from above it is liable to prove a dead weight.

To the landlords I say that, if what is said against you is true, I will warn you that your days are numbered. You can no longer continue as lords and masters. You have a bright future if you become trustees of the poor Kisans. I have in mind not trustees in name but in reality. Such trustees will take nothing for themselves that their labour and care do not entitle them to. They then will find that no law will be able to reach them. The Kisans will be their friends.

After independence, Vinobha Bhave in one way demonstrated the "Trusteeship" Concept through the "Bhoodan Movement".

Brief History of the Bhoodan Movement

By adopting Gandhi’s ideas to the solution of the basic economic problem of land collection & equitable redistribution among the landless, the Movement kept Gandhi’s ideas of socioeconomic reconstruction alive at a period when the tendency of the educated elite was to overlook, if not to reject Gandhi’s ideas as irrelevant.


An excellent article by Dr T Karunakaran, former Vice Chancellor of Gandhigram Rural University on the emergence of Corporate Social Responsibility in last few years, CSR in action, illustration of Mahatma Gandhi's concept of Trusteeship and the United Nations endorsed "Global Compact" concept.

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