The responsible trader or the responsible company will need guidelines and a clear opinion of what the term "responsibility" entails. So what does responsibility mean for investors? What are we responsible for and how can we face our responsibilities? I provide here one possible structure, but the most important thing is that you or your organization "man up" and take the responsibility that you already are in possession of. There are of course different takes on this depending on the size of your company and the sector you operate in. It has nothing to do with taking on new risk or new tasks, but rather realizing and fully accepting the risk and the
responsibility that already rests on you.
I have divided the term "Responsible Trading" into four categories on an organizational level. These four are co-dependant and should all be dedicated an equally significant amount of focus and effort in order to achieve success. A socially responsible company that ignores the environmental consequences of it's actions can not be taken seriously as well as an environmentally conscious company that neglects the needs of its employees and so on.
- Managerial Responsibility, The employees and partners
The salaries, labor laws and the enforcement of these will always vary from location to location and in some cases this can give a false sense of acceptance of much worse conditions for employees in a local branch. Why should an employee representing your company be treated differently because of his/her geographical workplace? Salaries naturally can not be uniform as costs are not uniform worldwide. I believe, a company that can be proud of how it is treating its employees worldwide, will also see proud employees worldwide.
The coal-plants with huge chimneys spewing out black smoke might be the classic picture of polluting industry. An investor has no chimney, but is still responsible for a varying amount of pollution. Investing your capital in "dirty" sectors such as Oil or car manufacturers can cause an ethical conflict. Finding where your or your stakeholders set the limits can be done on a general basis and if your investments are long-term they can even be done on a case-to-case basis. Taking a stand is the essential thing, we are all responsible for this earth and handing over more or less "blame" to someone else is irrelevant and avoiding responsibility can be seen as the most irresponsible action.
- Social Responsibility, Local community and society as a whole
Creating jobs means providing several families with an income and shaping the lives of many people in addition to those directly employed. The office-building, the neighbourhood, the city, the country. A company is a part of several communities big and small. Giving and receiving support and respect from these will provide not only better day-to-day operations, but also help relations with employees, partners or customers.
Creating jobs means providing several families with an income and shaping the lives of many people in addition to those directly employed. The office-building, the neighbourhood, the city, the country. A company is a part of several communities big and small. Giving and receiving support and respect from these will provide not only better day-to-day operations, but also help relations with employees, partners or customers.
- Financial Responsibility, Investors and stakeholders
Steady returns, risk management, clear and open reporting, dialogue with the investors and mutual respect for the individual roles. A complete profile of responsibility can generate additional revenue and a consistent impact beyond the short-term financial rewards.