Publications

FROM QUALITY MANAGEMENT TO ECOMANAGEMENT
AND GOOD GOVERNANCE

Quality is described as meeting customer expectations in terms of costs, specifications and delivery. A conundrum cast before us today is if a customer asks you to provide goods or services which in your view would damage the environment would you call meeting his/her expectations as quality? We all know how modern life styles and production processes have degraded the environment. If providing a product or service to meet a particular customer’s need ends up in polluting the environment for our children can it still be called a quality product or quality service? It is time, therefore, we had a relook at the definition of quality.

Quality which focuses only on expectations of a single customer at the cost of other customers and society cannot be real quality. A definition of quality has to include another attribute. It has to look at the whole life cycle of the product: where does the material come from, how it is processed, how it is used and how it is disposed of. In essence how it impacts the environment at each stage. This is what forms part of eco-management. Eco-management is defined as managing quality over a larger horizon by looking at the upstream and downstream sections of the product chain. The goal is to create value for the society as a whole and not just a single customer. Quality moves away from providing customer wants to focusing on customer’s needs and more importantly the long term needs.

Extending your horizon to care for the long-term societal needs has to be the key element of human effort and indeed the main challenge to leadership at all levels in the 21st Century. This is what is called stewardship. The fundamental role of leaders has to shift from production at any cost to protecting the environment, preserving natural resources and taking care biodiversity and the ecosystems with a view to safeguarding the interests of future generations. Sustaining effort to improve quality of environment calls for personal commitment. The question before us is how can business be made to realise that a duty of care for our environment and making a difference to the lives of disadvantaged and impoverished can provide a deeper purpose to business?

For the past 30 years environment has been the subject of a multitude of conferences, debates conventions, seminars, declaration and protocols. Yet we seem to be getting nowhere. Increasing evidence of global warming, depletion of the ozone layer, contamination of fresh water supplies, flood of toxic pollutants and declining biodiversity points to a human catastrophe. Yet, action on it lacks conviction.

World Environment Foundation launched the Indian Sustainability Movement on 5th June 2002 which was followed by the 4th World Congress on Environment Management at Palampur from 7-9 June 2002. The main recommendation flowing out of this conference was to generate a mass movement for change in life styles and reorganise patterns of production and consumption that would mimic biological processes and result in zero waste.

The issue in the environment debate always hangs on who should bell the cat? Who should initiate the change? We all know how difficult the process of change is. During the run up to the 5th World Congress on Environment Management and our discussions with business leaders, policy makers and civil society the questions of changing lifestyles continued to bog us until we discovered that the only way to change life styles is to start with oneself. Change has to be driven inside out. This is where spirituality comes in. Spirituality has nothing to do with religion. It is the process of looking inwards and drawing our inner strength and innate desire to do good. This is what provided us the direction for the theme of the 5th World Congress on Environment Management: Changing Lifestyles through Spirituality.

There needs to be seven pronged attack to bring life style changes. These seven areas of action are:

· Emphasising sustainability in corporate agenda
· Radical Increase in Resource Productivity
· Transparency in Governance
· Pricing of Natural Capital
· Eco Innovation
· Shifting from Acquisition to Flow Modes
· Moving from Cradle to Cradle

An important prerequisite to adding sustainability to corporate agenda is adoption of corporate governance practices based on transparency, accountability, equity, integrity and responsibility. My belief is that there are enough good people in the world to generate money to seed sustainable development strategies in developing countries. The biggest stumbling block is making sure it is spent properly. The real obstacle to improving environment, therefore, is poor governance. It is estimated that of the $33 billion of international aid for environment and welfare only 18% reaches the right people. In India itself, the government spends as much as Rs. 30,000 crore a year on rural development and poverty alleviation but only a small proportion of the same reaches those who need it. We need to make expenditure more accountable and the process of disbursment more transparent.

Our governance systems are also responsible for wasteful subsidies, which damage the environment without helping the economic well being. Subsidies kill competition and help only the inefficient. A recent study by the International Institute for Sustainable Development estimates that global society spends almost $ 1500 billion a year to subsidize activities that cause significant environmental damage. These subsidies foster in-efficiency through perpetuation of lock-in of old technologies and prevent innovation.

Corruption is another serious impediment to adopting sustainability agenda. Tens of billions of dollars exchange hands in graft and kickbacks worldwide. This results in production of wrong goods and services and increasing the existing burden of the poor who are at the receiving end in all such cases. Good governance practices can ensure better market framework conditions by encouraging freedom of competition. The public policy should focus on the targets, the desired end results rather than specifying the means of achieving the result. This cripples creativity and inhibits businesses to use their innovative ability to reach the target in a most cost-effective manner. Governance structures should be such that they support the entrepreneurial action, and risk-taking or innovation.

For changing production processes we need an explosion of eco-innovation. Eco-innovation is defined as the outstanding implementation of ideas, which meet future needs. We need to challenge, stimulate and harness the phenomenal ingenuity and creativity of our people to conceive and deliver products that require less material, are less energy intensive, have less toxicity, and which can be reused, recycled and valourised in a way that eliminates waste. Eco innovators imagine and implement smarter, lighter, more sustainable means of providing service while enhancing customer value. Eco innovation can make skillful use of technology available today to match needs and wants more closely at a substantially reduced environmental burden, thus, helping us to meet not only factor four but factor ten improvements.

Business has to realize that the markets of 21st century will be driven by the aspirations of sustainability. Irresistible forces of population growth and indiscriminate use of natural resources for ostentatious consumption have irretrievably broken the fragility of our planetary systems. The only solution lies in radical shift in our thinking. Incrementalism is not an option. We need a 180 degree shift from current industrial paradigm. We must go back to nature and mimic its processes of production. Nature has no waste. Life does not have to move from cradle to grave. As H H Shri Shri Ravi Shankar would say: “Life is a celebration”. Let us vow to eliminate waste from our production processes and move our world from cradle to cradle.

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