While reading the latest issue of The Raven, Bhutan’s premiere monthly news magazine, I came across an interview with Karma Phuntsho, a Buddhist monk and scholar who has transcended boundaries of traditional monastic life and explore how they apply to broader society, including entrepreneurship and business. His words inspired me to think about the role of values in business, something that has been on my mind for some time. How is it that this country, with such deep and historic Buddhist values and home of Gross National Happiness, is so prescriptive in its regulation?
In addition to continue his education at Oxford, he set up The Loden Foundation which is undertaking several pursuits, including digitizing Buddhist texts in Bhutan, promoting early education and bringing entrepreneurship to Bhutan’s youth. When asked by The Raven about future plans for The Loden Foundation, part of his reply focuses on bringing Buddhist values into business. He says, “A business should be a religion in a way – when done properly it should lead to enlightenment as much as sitting in a meditation cave… We should merge secular and business lives so that a businessman can feel quite at home inside running an ethical business and thinking he is doing good for society and also accruing good karma.”
The idea of a responsible business accruing good karma strikes me as interesting in particular because this country, home to GNH, somehow fosters low levels of trust between government and business. In the World Bank’s Ease of Doing Business report for 2013, Bhutan ranks 148 out of 185 countries, six places lower than its 2012 ranking. While I have not set up a business here, their analysis points to a heavily bureaucratic system with large numbers of documents and long time delays, even when compared to neighbours in the region. Despite headlines about Bhutan’s positive trajectory in Transparency International’s Corruption Index in today’s Kuensel Newspaper, this excessive bureaucracy is a signal of a high lack of trust.
An atmosphere of mistrust is not just the domain of governments, nor is it unique to Bhutan. It also exists around the globe within business as well. Halfway across the world, my friend Dov Seidman spends his life in NY exploring how leaders conduct business. In particular he has an amazing obsession with the role of trust and values in enabling business organisations to reach the next level. In a recent publication of The How Report, he highlights that, in a study of 36,280 employees, only 3% observe high levels of self governance.
While rare, self governance has been found to be associated universally with “higher levels of innovation, employee loyalty, and customer satisfaction; lower levels of misconduct; and superior overall financial performance.” This potential applies not only to self governance within a company, but also across stakeholder groups, including government and business.
I would not suggest that a young and growing private sector such as Bhutan’s is not yet ready for self governance any more than a puppy might be. (I have an energetic puppy at home these days, so I am acutely aware how hard it is to build trust – in both directions.) However, just as a trained dog has the potential to be trusted to watch children or guard a house, so can the private sector eventually be trusted to govern itself.
In order to trust the private sector to self govern, there is a need for a radical in case in transparency and the right rules are put in place to allow it to do so. This transparent and enabling environment will take time to build. It will also take time to embedding a strong set of responsible and ethical business values based on the bodhisattva. This should be an area where Bhutan should have a head start.
While the result of a trusting business environment can be worth the wait, there is really no need to sit around waiting as it is possible to accelerate the journey. Increasing transparency and reporting is a first step already being taken through the Bhutan Accounting Standards. Adding social and environmental transparency will help the transition towards integrated reporting. A next step will be creating an environment in which stakeholders can learn from each other and appreciate different perspectives. This will lead to a stronger business ethic and a better enabling environment for competitive business.
These first steps on a journey towards business enlightenment have the potential to nurture a strong and responsible private sector – one driven by the same ethics and values that Karma Phuntsho and his robed colleagues would be proud of.