Hack:
Terms and Conditions :The answer to long term capitalism sustainability

May 9, 2012 at 1:00am

Summary

Long term capitalism sustainability has been dealt a major blow by greed, chroinism, and lack of morals. We have credit agencies who give advisory service and comeback to rate the same enterprises, double-dipping without consequence even if the advice was proven wrong. On the other hand, lobbyists who won the war on deregulation, created a derivative product, sold it on to undeserving and non qualified buyers without the penalties or consequences. Despite having full knowledge that the probability of default is high, they collect commissions and huge pay checks, laughing all the way to the bank. (Pozen R, 2010)

This present-day capitalism is not sustainable in its current form. It is not so cancerous that it cannot be separated from the host but rather, an ailment that needs a full course of antibiotic to remedy the situation.

To remedy this dire condition there is a need to make capitalism profoundly principled. It is this area that I focus on my submission to MIX

Problem

The present day form of capitalism has been credited as a major contributor of the Global Financial Crisis 2008 as a major example of failed long term capitalism sustainability. (Davidson P, 2009).Reforms serve lobby groups and a select few and do not take in holistic view of ecological,economic and social factors furthermore there is a disconnect in organisational response

The problem is government reform that has no oversight or consequences has resulted in exploitation by bad management practices with dire financial and social consequences.The reform has prioritised short term gains as the most attractive economic persuit for organisations coupled with powerless oversight regulatory bodies who cannot enforce breaches.

Solution

My solution seeks to significantly shift organisational behaviour and consequently promote long-term capitalism sustainability by mandating all businesses to adhere to new regulated and monitored Terms and Conditions as prerequisite to operating an organisation.(Woffenden Ken and Giles Dennison, 2004)

Just as much as you have to agree when purchasing a service or product to the Terms and Conditions I propose that all business subscribe to this remedy. I would point out if you refuse to agree to the Terms and Conditions when buying software or simply a broadband service, you cannot obtain the product or service. These terms are to be non-negotiable and come standard with operating a business.

A. YOUR RIGHTS OF BUSINESS (REID E J, 2005,Sustainable Capitalism)

Right to operate and sustain a business
Right to defend from threat to the business
Right to trade with whoever the business prefers
Right to pursue opportunities across border and cultures
Right to market and advertise your business
Right to obtain accurate and unbiased information
Right to communicate, collaborate and organise
Right to formalise and self-govern

B. YOUR OBLIGATIONS

Social & Employment

You are responsible for people under your employment (Including contractors) whilst in your employ for their collective well-being
Conduct your business in an ethical manner whilst respecting rule of law
You are responsible to respect and defend basic human rights to anyone under the control/influence of your organisation –including supply chain and contractors.( Arrow K ,1993)

Ecology

You are responsible for the environment/resource that your business derives value from.
You to engage all environmental stakeholders and seek mutual beneficial solutions and report specifically on this engagement.
Your business must demonstrate mitigation to address environmental concerns impacted or influenced by your organisation.

Economic

Adhere to rule of law regarding financial obligations, including taxes and government regulation wherever your business is conducted
Innovate/pursue chosen economic activity with due regard to environment and society impacted by your organisation.
Responsible remuneration and pay equity must be exercised at all time.

Reporting (Dirkes Meinolf and Antal A B,1985a)

Report bi-annually to oversight bodies within your industry to demonstrate compliance
Transparency, accuracy and honesty required in all reporting
Adopt a globally accepted accounting system

Penalties

Any organisation that fails to consistently adhere to Terms & Conditions will face penalties that include fines and possible deregistration as a business
Any directors who fail to comply will be subject to a 3 strike rule after they will be prohibited for life as directors or business owners.

Practical Impact

It is apparent that reform is necessary. What is more prudent is the approach to reform that encompasses economic, social and ecological factors. The reform must have a goal in mind with appropriate controls/constraints and rewards that guide desired organisational behaviour outcomes .(A Savoy, 1988). There is a need to “focus on generating innovation and leading change to stimulate and to accelerate economic and financial transformational progress. (Baumol W, 2004)

A new paradigm transformation is required where organisations apply deliberate, well thought-out planning and holistic leadership. (Senge P, 1990). The disease of unethical behaviour, coupled with dishonesty, must be dealt with in a methodical and systematic manner. (Willard B, 2002).

In essence the practical impact would be a positive well round ,widely consulted solution that will have buy-in by both consumers and businesses alike.

First Steps

A panel of specialists in conjuction with the Ministry of Economic Development should expand and refine my solution as a sponsored project to be submitted for public consultation with a view of making the proposal into law as Terms and Conditions required for conducting a business.

Credits

Arrow Kenneth,1993,Social Responsibility and Economic Efficiency, Public Policy 21,301

Baumol W , R Litan and C Schramm , 2009 , Good Capitalism ,Bad Capitalism and

the Economics of growth and Prosperity.

Dirkes Meinolf and Antal A B,1985a,Corporate Social Reporting and Auditing: Theory

and Practice.

Fraser S, 2008, Every man a speculator: A history of Wall Street in American Life.

Goshal S, 2005, Bad Management theories are destroying good management

practices: Academy of Management learning and Education, 75-91.

Harnischfeger U , 2008 , “UBS say excess of ambition led it to its miscues

on subprime loans “New York Times (22 April 08.C3).

Muolo P, 2008 ,The Emergency economic stabilization act and what it means to you