Business and people development

Business and people development (June 7, 2005)

Ben Teehankee

Managing For Society column, The Manila Times

How can we accelerate the development of our country? A lot depends on how we think of development in the first place. Many economists equate development with national economic growth. They reason that when we achieve GNP growth, people will have the means to have a decent level of living and the other things that life has to offer.

I see many holes in this argument. Even while the country is achieving economic growth, many continue to suffer in misery through lack of income and perennial insecurity with the basics in life. Nobel Prize winner Amartya Sen is one economist who goes beyond economic growth when talking about development. In Development as Freedom, Sen describes development in terms of important human capabilities.

To Sen, a country is more developed when more people are able to have healthy and productive lives. And it is more developed when more people enjoy civil and political rights. Sen’s notion of development is simply a humane and secure existence for people. It specifies people as the goal of development and not merely as resources for development.

What is the role of business in helping the country achieve genuine development? Is it enough to provide employment and income? Is it enough to enable people to buy goods and services? Clearly not. Businesses can employ people and yet deprive them of health and safety protection as well as security of tenure. Employees can be deprived of they’re right to have a voice on matters that affect them, whether through direct participation or through free association. And employees can enjoy plenty of consumable goods through their incomes and yet remain limited in their ability to achieve productive work and fulfilled personal lives.

To help develop the country, businesses need to do more. They must directly contribute to national development by developing their people and treating them with dignity. Companies who are serious about people development and building humane conditions for employees can get guidance from two international standards, namely, the Social Accountability Standard (SA 8000) and the Investors in People (IIP) Standard.

The SA 8000 standard is described as “a way for retailers, brand companies, suppliers and other organizations to maintain just and decent working conditions throughout the supply chain.” One element in the standard ( is that companies “respect the right to form and join trade unions and bargain collectively.” Although a constitutionally guaranteed civil right, the right to freely associate is often ignored or hindered by companies. The standard also requires a company to “provide a safe and healthy work environment”. What insecurity could be worse for an employee than not knowing if he or she will go home in one piece or with his health intact? And yet many employees continue to work in blatantly unsafe or unhealthy conditions.

The IIP Standard, for its part, focuses on developing people’s capacity for participation and productivity. The standard strategically links people development with the achievement of the company’s bigger goals. One IIP indicator is that “people are encouraged to take ownership and responsibility by being involved in decision-making.” This indicator emphasizes that humane organizations treat people not as “pairs of hands” but as collaborators in the enterprise. That “people learn and develop effectively,” is another IIP indicator. This indicator measures the improved productivity achieved by employees through a company’s training and development programs.

The IIP Standard is being promoted locally by the Personnel Management Association of the Philippines (PMAP). Gerry Plana, PMAP’s Executive Director, informs me that they are distributing grants from the European Union and technical assistance to SMEs interested in pursuing the standard. More details on the standard are available at

One question I always hear when people development is discussed is: “Where am I going to get the money?” My answer is: “The same source from which you got the money for your office building and computers.” “But buildings and computers don’t leave you for the competition,” goes the retort. And there lies the rub. It’s really about fear. Many companies don’t invest in people because they’re scared that employees will leave them. Well, the last time I heard, business was about having the guts to take risks. Believing in people enough to invest in them is, indeed, a risk. But it’s the only path to sustainable business competitiveness and genuine national development.