Government stimulus programs and bailouts of the biggest and sickest corporations alone will not solve the problem. Companies must re-engage their people. Both management and leadership practices need to be rethought.

The problem of subprime lending is a prime example of this. How could it have happened in the first place and how could it have spread to so many large financial institutions? The answers seem obvious. Those who promoted these mortgages sought to increase sales as quickly as possible to maximize their own bonuses, and to hell with the ultimate consequences. And the financial institutions that bought these mortgages were out of control. Many of their executives adopted what has become a widespread style of “leadership” in America: they sat in their offices and announced goals that they wanted others to achieve, instead of taking up the cause and helping to improve performance. Managers didn’t know what was going on, and employees didn’t care what was going on. What a monumental failure of management.

To one degree or another, the same failure occurred in the private and public sectors. A belief has emerged that leadership is somehow separate from and superior to management. This view only isolates people in leadership positions, thereby undermining the sense of community in organizations.

Communities at Work.
Individualism is a good idea. It provides incentive, promotes leadership, and encourages development, but not by itself. We are social animals who cannot function effectively without a social system that is bigger than ourselves. This is what is meant by “community,” the social glue that binds us together for the common good. Think no further than the energy unleashed by the strong sense of community in Barack Obama’s campaign .

Community means caring about our work, our colleagues, and our place in the world, geographically and otherwise, and, in turn, inspiring that caring. Characteristically, some of the companies we admire most – Toyota, Semco (Brazil), Mondragon (Basque Federation of Cooperatives), Pixar, etc. – usually have a strong sense of community. This was made clear in a September 2008 article in HBR by Ed Catmull, president of Pixar, in which he attributed the studio’s success in producing a number of very popular animated films to its “vibrant community where talented people are loyal to each other and to their collective work, everyone feels they are part of something extraordinary, and their passion and achievements make the community a magnet for talented people coming out of school or working in other places.

Young, successful companies usually have this sense of community. They are growing, full of energy, committed to their people, almost family. But maintaining it as they mature can be a different matter: events slow down, politics escalate, the world is no longer their oyster. Community is sometimes easier to maintain in the social sector-with NGOs, nonprofits, and cooperatives. The mission can be more appealing, and the people more engaged.

But somehow in our feverish, individualistic world, a sense of community is lost in many companies and other organizations. In the United States in particular, many great enterprises, along with the country’s legendary sense of enterprise, are collapsing as a result.

Enough leadership.
“Community” is not a word in the English language. But it is supposed to stand between personal leadership on the one hand and collective citizenship on the other. In fact, I believe we should never use the word “leadership” without discussing community.

Of course, leaders can engage and involve others. But the concept is still person-centered – personal initiative. Show me a leader, and I’ll show you a group of followers.

Community certainly uses leadership, but not in the self-centered, “heroic” way that has become so common in the business world. These days we make a big fuss about the evils of micromanagement – the interference of managers in the affairs of their subordinates. Much more serious is “macro-leadership”: the exercise of power “from the top down” by detached leaders. Community requires a more modest form of leadership, which can be called engaged and distributed management. The community leader engages personally to engage others so that anyone and everyone can take the initiative. If you doubt this can happen, look at how Wikipedia, Linux and other open source operations work.

So maybe it’s time to wean ourselves off the heroic leader and recognize that we usually have enough leadership — leadership that intervenes when it’s appropriate and encourages people in the organization to get things done.

That’s how IBM came into e-business. An enthusiastic programmer eventually convinced the middle manager that the opportunity existed. The manager put together a team with virtually no budget. And when the initiative finally reached Lou Gerstner, then CEO, he supported it. That was it. Enough leadership!

From top-down to average.
How can we rebuild companies as communities? Unfortunately, most of the hundreds of articles and books on how to manage large-scale change – transformation, revitalization, upheaval – focus on leadership. A popular example is “Leading Change: Why Transformation Efforts Fail” (HBR Classic , January 2007), in which the author, John Kotter, identifies eight steps: First, create a sense of urgency. Then build a strong leadership coalition in which “senior managers always form the core. This coalition must create a vision and broadcast it so that others can realize it. The process moves on to planning for short-term wins, consolidating improvements, and institutionalizing new approaches.

Kotter’s approach sounds reasonable enough and has probably worked. But how often and for how long? What happens when the driver of leadership leaves? Perhaps it’s time to rebuild companies not from the top down or even from the bottom up, but from the middle – through groups of middle managers who band together and make key changes in their organization.

Can major transformations really begin like this, almost spontaneously, with small actions by people outside the top management? Well, think of the American Revolution, which began with the tea party, or the French Revolution, which began with storming a prison to free a handful of prisoners. In his recent book, “Community: The Structure of Belonging,” Peter Block, an authority on workplace learning and productivity, wrote: “Most sustainable improvements in community happen when citizens discover their own ability to act … when citizens stop waiting for professionals or elected leadership to do things and decide that they can give back what they have delegated to others. Think of all managers as citizens of their corporations.

A useful framework.
In large hierarchical organizations, certain conditions help ease the transition to community:

Community Remains.
It’s much easier to build what’s left of a community than to create one from scratch. In my experience, many companies that seem to have lost their sense of community actually retain it somewhere, even if it is hidden from executives who have not appreciated it. For example, in pharmaceutical companies that have become bumbling behemoths focused on sales and acquisitions, you can always find groups of scientists who are still deeply committed to finding cures for diseases.
Often the remnants of commonality must be sought among middle managers. A significant number of these people tend to be knowledgeable about the enterprise and deeply interested in its survival. After examining the role of middle managers in corporate transformation, Quy Nguyen Hai, professor at Insead, wrote: “I was surprised by the intensity with which [middle managers] sought to protect the long-term interests of the company and the well-being of their subordinates. again and again” (“Praise for Middle Managers,” HBR, September 2001). Senior managers, not to mention middle managers themselves, should recognize the power of this dedication.

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There’s no reason you can’t use these resources for your business. By the end of 2013, be sure to visit at least two of the organizations listed below. If you don’t find even one or two pieces of information that will help you in your business, contact me . and I will personally help you find the information you are looking for for your company.

Small Business Administration

The SBA offers advice and training for small businesses through area offices across the country. You’ll find business development professionals providing free and low-cost services in your area.

Suitable for: a wide range of business owners. In one office you may find someone who hasn’t started a business yet, next to an entrepreneur looking for a $5 million loan to buy real estate.

SCORE, known as Small Business Advisors of America, is a nonprofit association of more than 13,000 volunteer business advisors in the United States and its territories. SCORE members are trained to serve as advisors, counselors and mentors to aspiring entrepreneurs and business owners. These services are provided free of charge as a community service.

Suitable for: startups for the first two years. SCORE offers tremendous support to companies seeking to avoid the pitfalls that will kill most new companies in the first 24 months.

Small Business Development Centers

SBDCs help aspiring entrepreneurs realize their dreams and help existing businesses stay competitive in a complex, ever-changing global marketplace. SBDCs are housed at top universities and state economic development agencies.

Suitable for: existing companies looking to get to the next level.

Chamber of Commerce.

Your local or regional chamber is a membership-based community organization that actively promotes, educates and advocates for its members through a variety of services and programs. Member offerings typically include networking opportunities and events, educational seminars, leadership development and special member offers from other chamber members.

Suitable for: companies interested in local networking and business development.

Veterans Business Support Centers

The Veterans Business Outreach Program (VBOP) is designed to provide entrepreneurial development services such as business training, counseling and mentoring, and referrals to eligible veterans who own or are starting small businesses. The SBA has 16 different organizations participating in this cooperative agreement to serve as Veterans Business Support Centers (VBOCs).

Suitable for: veterans who want to start a business or need help managing and growing an existing business.

Women’s Business Centers.

WBCs are a national network of nearly 100 educational centers in the United States and its territories that help women start and grow small businesses. The SBA Office of Women’s Business Ownership (OWBO) oversees the WBC network, which provides entrepreneurs (especially economically and socially disadvantaged women) with comprehensive training and advice on a variety of topics in multiple languages.

Suitable for: women who own their own businesses, whether they are in the startup or growth phase.

Procurement and Technical Assistance Centers

PTACs provide local personal counseling and training services designed to help businesses that want to sell goods and services to federal, state and/or local governments. PTAC services are either free or at a nominal cost.

Suitable for: business owners who would like to know about such services before beginning the difficult journey of selling products and services to the government.

U.S. Export Assistance Centers

Each U.S. Export Assistance Center (USEAC) has specialists from the SBA, the Department of Commerce, the Export-Import Bank, and other public and private organizations. Together, their mission is to help small and medium-sized businesses compete in today’s global marketplace by providing export assistance.

Suitable for: entrepreneurs targeting the global arena.

Certified Development Companies.

CDCs are non-profit corporations certified and regulated by the SBA. They work with participating lenders to provide financing for small businesses. There are 270 CDCs nationwide, covering certain geographic areas.

Suitable for: an existing business owner looking for loan financing to purchase capital equipment, another company or enter new markets.

Running a business today is difficult. Don’t make it difficult by trying to do everything yourself. Take the time to visit the support organizations mentioned above and let them help you run your company better and smarter.

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However, perhaps less well understood are the benefits of protecting civic space for business – the freedom of citizens to organize, speak out, and protest against mismanagement and corruption.

The good news is that, in at least one area, business and civil society are increasingly converging.

When President Donald Trump announced that the United States was pulling out of the Paris Agreement on climate change, some of the loudest criticisms came not from civil society, but from business leaders.

Turning up the heat

The success civil society has had in working with business on climate change shows that improving the relationship between business and civil society is possible. The new challenge is to convince business that action on civil liberties is just as important as action on global climate change.

Climate activists, through shareholder action as well as boycott and divestment campaigns, have secured commitments from institutions to pull $5 trillion from the fossil fuel industry worldwide.

Many businesses continue to find common ground with civil society for climate-friendly solutions. Activist shareholders recently succeeded in getting the world’s largest oil and gas company, Exxon Mobil, to commit to disclose the impact of climate change on its business.

On human rights, however, progress has been much slower.

Too often, “business as usual” can lead to human rights abuses, resulting in land grabs from indigenous peoples, killings of human rights defenders, or attacks on peaceful demonstrations.

Moreover, massive tax evasion around the world continues to reduce government spending and exacerbate global inequality. Indeed, the enormous scale of global corporate tax evasion perpetuates economic inequality, forcing cuts in basic social services and even, as the evidence suggests, ultimately impeding economic growth. Citizens for Tax Justice estimates that the 500 largest U.S. companies consistently keep $2.4 trillion in profits offshore, avoiding up to $695 billion in taxes.

In addition, $50 billion, far more than the inflow of official development aid, leaves Africa illegally each year, and business is thought to play a key role in ensuring this.

Nevertheless, while it is clear that improving business’s commitment to civil liberties and human rights will have obvious benefits for civil society, it is less known that business can benefit as well.

Indeed, according to the World Economic Forum, the weakening of the rule of law and the decline of civil liberties are a major global risk in 2017 .

A study by the UN Global Compact shows that social risk can increase, on average, 10 percent of a business’s operating costs. The difference between operating in an environment with low levels of corruption and one with higher levels of corruption can be 20% of profits. Bribery, against which empowered civil society offers a powerful defense, is estimated to be worth about $1 trillion per year.

Attacks on civil liberties can also cost businesses. According to research, the economic damage from Internet blackouts in the English-speaking region of Cameroon this year is $2.4 billion. This puts a clear price on the failure to protect civic space.

The rewards for supporting civic space are also clear. CIVICUS’ latest annual report identifies several areas of partnership for positive social change between business and civil society. It emphasizes the need for business to adopt a “do no harm first” approach and then go further by demonstrating an active commitment to advocacy.

Nicolas Patrick of the global law firm DLA Piper, which is part of the Business Advocates Network, insists that business can only succeed where there is the rule of law. His firm views civil society as an indicator and facilitator of the rule of law. It supports civil society organizations with strategic advice on how to obtain registration in high-risk jurisdictions and support in cases of arbitrary detention.

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Further, at the WSSD many actors from developing countries have raised their concerns by declaring that their voices and views are inadequately articulated, hence their disenfranchisement from multilateral environmental governance. They felt that most ideas and initiatives presented during the summit came from developed countries. Even though it was agreed that most of the initiatives are good solutions addressing real issues, it was argued that some ideas would not be practical in developing countries. The training, experience and access to information required for meaningful participation is particularly onerous for developing countries. Both civil society actors and developing countries are struggling to exert influence, and are searching for ways to overcome barriers to participation and contribute on an even par with those safely within the confines of the multilateral process.

Business is a primary driver of economic development. However, their environmental and social impacts are said to fall short of international benchmark standards of corporate social responsibility when operating in developing countries and pose greater environmental and social threats to society. With this negative conception, it has also been realised that the active involvement of businesses is critical to achieving poverty alleviation and sustainable development in developing countries. With this in mind, it is believed that business can play a role in advancing the involvement of civil society and government in developing countries in sustainable development governance. Similarly, it has been argued that “Partnerships with external organisations are key to helping companies succeed at creating value through sustainable development strategies”1

Interestingly, there have been many arguments about the role of business in society but there has never been a universally agreed benchmark on what the role of business organisations in society should be. The paramount aim of this research is to examine the relationship between business and civil society in the context of sustainable development – oriented agenda setting and capacity building at national and local community levels in developing countries. Attention will be given to how business organisations foresee their role in society, essentially, in ensuring that multilateral environmental agreements, internationally advocated business ethics and environmental codes of conduct are observed in countries where they operate. Many companies operating in developing counties are said to fall short of international benchmark standards due to lack of legislation and necessary monitoring mechanisms to check the environmental threats posed by their operations. These developments make companies aware of the social dimensions of their organisations, their corporate image, their role within society and their duty towards future generations. Their environmental and

community development initiatives and policies may be seen in most instances as a response to the threat of stakeholder sanctions. Yet civil society organisations (CSOs) criticism of unethical and immoral corporate behaviour continues to grow louder in recent times. The clamour has led many business organisations to engage in purposeful soul searching for greater social legitimacy and to create new business models that could benefit from partnering with suitable CSOs.

The private sector is beginning to accept that prosperity, profitability and shareholder value alone do not represent the value of the company. The companies‟ ability to grow and excel in the long run is also determined by their improved performances in terms of ethically and environmentally responsible contributions to society. Major corporations are now fully aware of the increasing vulnerability of their reputation and are increasingly willing to engage multi-stakeholder learning dialogues to the cause of sustainable development in conjunction of their business strategies in developing countries. They understand that without ethical and environmental considerations, their legitimacy and ability to function properly will be questioned by civil society.

Partnerships between Business and Civil Society

Increasing demand for sustainable development during the last decades has initiated actions from governments as well as corporations and CSOs. 3 Governments have reacted by translating these demands into policies and laws, mostly of a „command and control‟ (CAC) type. Corporations have expanded the scope of corporate responsibility to include environmental issues in all level of operation, with a major development of environmental

corporate strategies, as well as a green-washing of industry has been observed. Palmer et al.4 suggest corporate strategy changes to enhance environmental as well as business performance of firms. On the other hand, CSOs have been providing an alternative voice by pointing out threats to sustainable development caused by business activities globally. Despite all these preventive actions a continuous increase in environmental impact has been observed. Global warning, in particular, has been considered as one of the most severe and difficult to handle. This has led to new initiatives and calls for business-society partnerships in resolving the global environmental and social concerns.

Development-oriented CSOs are facing increasing uncertainty and reductions in financial resource flows from international donors and national governments. Simultaneously, demands for services are growing as large numbers of people suffer from decreased government services and economic dislocations that are associated with global financial shifts. 5 In the context of declining legitimacy of government to provide basic services, particularly, in developing countries, pressures on private actors in civil society and the market to address social demands are increasing. Global leaders in the development field are promoting collaboration between civil society and the market as a significant new strategy for promoting sustainable development. Major actors such as The World Bank, the United Nations Development Programme and several bilateral donors are convening international forums, supporting innovative projects and advocating strategies for collaboration between sectors.6 For example, the United Nations Secretary General Kofi Annan, in a speech to encourage business-civil society partnerships observed:

We now understand that both business and society stand to benefit from working together. And more and more we are realising that it is only by mobilising the corporate sector that we can make significant progress… Corporate sector has the finances, the technology, and the management to make all this happen. The corporate sector need not wait for governments to take decision for them to take initiatives.⁷

The ideas that increased levels of civil society –business cooperation will bring significant sustainable development benefits and substitute for the role of the state need further exploration. If collaboration with business is warranted as a major new strategy, it should produce significant impacts and be widely replicable across the developing countries. This section assesses the empirical data from cases of civil society-business partnerships in Brazil, South Africa and India as reported by Darcy Ashman⁸ in his empirical research and also examines some few cases between Japanese NGOs-business partnerships in Japan. It identifies the benefits of civil society-business collaboration and examines factors associated with the relatively more successful cases. The analysis suggests a more sobering and perhaps surprising view of inter-sectoral collaboration than many advocates working within the neoliberal paradigm expect. Corporate citizenship may not produce significant development results unless CSOs are strong partners in collaborative activities, and governments may play very important roles in producing successful collaboration between the other two sectors.

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