CRT FRAMEWORK. Why you should be a member of

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1 CRT FRAMEWORK Why you should be a member of Promoted by: Why join CAUX Round Table (CRT)? Business people are faced with serious threats if they do 1

2 not maintain ethical standards. Public awareness is rising. There is higher competition and more demand for value and accountability hence the need to address the declining ethics phenomenon in institutions. Becoming a member of CRT is an opportunity to join an international business community that is concerned with ethical business practices for better business performance and for a better world. The organization provides an evolving methodology for assessment introduction and institutionalizing ethics in the conduct of business. approach with various stakeholders in order to advocate the notion of ethical business. These stakeholders; customers, employees, owners/investors, suppliers, competitors and the community provide the vital support required to disseminate ethical doctrine. experiencing today as a result of the global financial crisis and our local political dilemmas, Frederik Philips, former President of Philips Electronics, and Olivier Giscard d'estaing, ViceChairman of INSEAD founded the CAUX Round Table in At the urging of Ryuzaburo Kaku, Chairman of Canon Inc. the Round Table has focused attention on the importance of global corporate responsibility in reducing social and economic threats to world peace and stability. Jacky Nyandeje Executive Director, Ethics and integrity Institute, Kenya APPLICATION OF CAUX ROUND TABLE FRAMEWORK Changing the world through aspiration and a highly principled mind is not sufficient; the action of many is a key ingredient in promoting ethical business practice. CAUX Round Table endorses a collaborative In the words of Stephen B Young, one of the founders of the CAUX Round Table, the teaching of ethical norms whilst no guarantee of application, is nonetheless the start of building a moral community (Young Stephen, Moral Capitalism: Reconciling private interest with public good ). In fact, the development of social capital has been recognized as one of the fundamentals to the overall effectiveness of reform. CAUX ROUND TABLE FOR ETHICAL LEADERSHIP IN BUSINESS Business is the first contact between (people) nations and, by the way in which it causes social and economic changes, has a significant impact on the level of fear or confidence felt by people worldwide. Concerned about escalating trade tensions perhaps similar to what we are From Left: Robert McGregor Chairman, Pro International Consultants and President Emeritus, Amb. Amina Mohamed Cabinet Secretary- International Trade and John P. Luusa Chairman Institute of Directors, Kenya The Round Table recognizes that shared leadership is indispensable to a revitalized and more harmonious world. It is concerned with the development of constructive economic and social relationships between the participants' countries, and with their urgent joint responsibilities towards the rest of the world. It emphasizes the development of continuing friendship, understanding and cooperation, based on a common respect for the 2

3 highest moral values and on responsible action by individuals in their own spheres of influence. Shaking hands, Prof Daniel Oruoch Chairman CRT Kenya Chapter and Amb Amina Mohamed Cabinet Secretary International Trade The CAUX Round Table believes that the world business community should play an important role in improving economic and social conditions. It seeks to begin a process that identifies shared values, reconciles differing values, and thereby develops a shared perspective on business behaviour acceptable to and honored by all. These principles are rooted in two basic ethical ideals: 'kyosei' and human dignity. The Japanese concept of kyosei means living and working together for the common good enabling cooperation and mutual prosperity to coexist with healthy and fair competition. Away from the blame game members of the CAUX Round Table place their first emphasis on putting one's own house in order, and on seeking to establish what is right rather than who is right. (CAUX Roundtable- Minnesota Principles of Business) The unifying purpose of CRT is moral capitalism for a better world. It seeks to improve the outcomes of market economies and globalization in the world through enhancing the impact of ethical conduct and social responsibility in companies. Those who attended the seminar series discussed the concerns about ethics, those that lead the renowned business leaders to start this important institution. CAUX Round Table Kenya Chapter in order to provide people in Africa with a platform and a framework to share and explore ways of improving ethics in society and business in particular CAUX Round Table Objectives CAUX Round Table aims to convey a world standard on which business behavior is measured. Utilizing the principles of kyosei and human dignity, it intends to demonstrate that upholding ethical practices in the business and academic environment is not only beneficial, but fundamental to improving economic and social conditions. Globally, we are facing a fundamental crisis: a crisis in global economy, global ecology, and global politics. There is a distinct lack of vision, a tangle of unresolved problems, political paralysis, and in some cases mediocre leadership with little insight or foresight. As a result, we have too many old answers to new challenges. (The Parliament of the World's Religions: Declaration Toward a Global Ethic) The recent global economic downturn has demonstrated to us the failures of providing quality goods and services at a price that is reflective of their worth (Young, Stephen B (2008) CRT Principles and the Crisis). Not only has this been a wake up call to the dangers of promoting brute capitalism, it has necessitated a shift in thought towards incorporating moral capitalism into business. In Kenyan culture particularly, traditional ethics of community unity and solidarity have formed the fabric of our society, but we have lost the direction to ingrain this into daily modern practice and interaction with each other. In respecting our communities, it is fundamental that we create an environment whereby respect, collaboration and binding values are entrenched in our personal attitudes and consequently in our society. This ethical approach is what is crucially lacking in Kenya at this time. Without upholding sound ethical principles, we fail to be socially responsible, and therefore provide ourselves with the best opportunities for economic and social growth. As Kenya transitions and evolves into a country we can all live in peacefully with great opportunity, we face the challenge to practice what we speak, and in this case, the ethical principles we aspire to should be implemented. 3

4 Prof. Daniel Musungu Oruoch Chairman Caux Roundtable Kenyan Chapter, Robert McGregor Chairman, Pro International Consultants and President Emeritus, Amb. Amina Mohamed Cabinet Secretary- International Trade and John P. Luusa Chairman Institute of Directors, Kenya, Jacky Nyandeje Executive Director, Ethics and Integrity Institute, Kenya, Joram Meshack, CEO Institute of Directors, Kenya, Allen Ndungu,Member, Institute of Directors In this respect, there is an opportunity to provide the framework to support reform, peace, security, diversity, social integration and mutual respect for rules as global corporate citizens. CAUX Round Table encompasses this idea through a set of principles namely: Principle 1. The responsibilities of business: beyond shareholders toward stakeholders. As the value of a business to society is the wealth and employment it creates and the products and services it provides to consumers, to create value, a business must maintain its own economic health and viability beyond mere survival. Businesses have a role to play in improving the lives of all their customers, employees, and shareholders by sharing with them the wealth they have created. As responsible citizens of the local, national, regional and global communities in which they operate, businesses share a part in shaping the future of those communities. Principle 2. The economic and social impact of business: towards innovation, justice and world community. Businesses established in foreign countries to develop, produce or sell should also contribute to the social advancement of those countries. Businesses also should contribute to human rights, education, welfare, and vitalization of the countries in which they operate. Businesses should contribute to economic and social development not only in the countries in which they operate, but also in the world community at large, through methods such as effective and prudent use of resources, free and fair competition, and emphasis upon innovation in technology, production methods, marketing and communications. Principle 3. Business behaviour: beyond the letter of law, towards a spirit of trust. While accepting the legitimacy of trade secrets, businesses should recognize that sincerity, candour, truthfulness, the keeping of promises, and transparency contribute not only to their own credibility and stability but also to the smoothness and efficiency of business transactions, particularly on the international level. Principle 4. Respect for rules. Businesses should respect international and domestic rules in addition, to recognizing that some behaviour, although legal, may still have adverse consequences. Principle 5. Support for multilateral trade. Business should support the multilateral trade systems of the GATT/World Trade Organization and similar international agreements. They should cooperate in efforts to promote the progressive and judicious liberalization of trade and to relax those domestic measures that unreasonably hinder global commerce, while giving due respect to national policy objectives. Principle 6. Respect for the environment. A business should protect and, where possible, improve the environment, promote sustainable development, and prevent the wasteful use of natural resources. Principle 7. Avoidance of illicit operations. A business should not participate in or condone bribery, money laundering, or other corrupt practices: indeed, it should seek cooperation with others to eliminate them. It should not trade in arms or other materials used for terrorist activities, drug traffic or other organized crime. 4

5 The aspirations of the human race around the world cannot be safeguarded without fundamental consensus on binding values, irrevocable standards, and fundamental ethical attitudes which apply to all human beings and institutions; hence the need for entrenching ethics in all that we do.(source: A UNESCO Plan for a Universal Declaration Of Human Responsibilities) If we can succeed in producing men and women of keen conscience, we can do no greater service to our nation(s) and the world Joel Fleishman 5