The role of the board of directors of a company and the CEO should be to set up an operating framework, setting out how interaction is to take place with different stakeholders. There are many stakeholders that have to be served but varying needs may lead to misalignment and conflict.
Addressing a Chartered Institute of Management Accountants (CIMA) HR Leaders Forum this week, CEO of Ceylon Brewery Suresh Shah said it is precisely this conflict which leads to ethical dilemmas. Speaking on ethics in human resources, Mr. Shah said ethics is doing what is fundamentally right. There are written and unwritten codes of principles and values but at the core, people know what is right and what is wrong and should choose to do the right thing.
The tone is set by the Board and the CEO. If the top is clean and fair, Mr. Shah said the organization will also be clean and fair. Appointments of truly independent and principled people should be made to boards of companies and their audit committees. There should also be a separate role for the Chairman who looks abter governance and the CEO who looks abter strategy. Mr. Shah also said there should be an annual evaluation of boards.
He added that HR plays a crucial role in establishing corporate culture which aligns the skills of the workforce with an organization’s ongoing and future business plans. Mr. Shah said people should be recruited for attitude and trained for skills. Speaking at the Forum, Cargills CEO Ranjit Page said short term goals to enhance earnings led to the global financial crisis. Companies can earn reasonable profits if it is reinvested in the country to create employment and build a better country for future generations.
Mr. Page said Cargills which once catered to the top end of society and was renowned for exorbitant prices aspired to shibt its focus to the masses, drive down the cost of living, enhance youth skills and bridge regional disparity. He said the priority for the company is social well being, survival and expansion, long term profits and taking high quality nutrition to the masses.
Mr. Page added that the Cargills team genuinely cares for customers and understands the needs of Sri Lankans while innovating to create sustainable value to all stakeholders.
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