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Caux Round Table 2012 Global Dialogue: Recommendations
Caux Round Table 2012 Global Dialogue: Recommendations
Published 08-01-12
Submitted by Caux Round Table, The
The Caux Round Table (“CRT”), an international network of business professionals advocating a moral capitalism, meeting in its 27th Global Dialogue, resolved upon four major reforms to restart sustainable global growth. These four recommendations will permit capitalism to overcome its current crisis of mediocre, financial performance, combined with systemic, ongoing, ecological and demographic imbalances.
The CRT Global Dialogue resolved that, first, the U.N. General Assembly should adopt a charter of responsible practices for sovereign nations to maintain sound and sustainable financial intermediation at a reasonable cost to society.
Second, sound and sustainable financial intermediation requires changes in banking practices. Compensation systems, except in small privately held firms, should be aligned with levels of moderate leverage, moderate risk and professional prudence. Trading and speculation, as a business model, should be separated from commercial banking and lending, as a business model, and should be supported by industry- financed reserve funds. “Too big to fail” financial institutions should be broken up under anti-monopoly laws.
Third, sound and sustainable financial intermediation requires non-negligent ratings of securities and their issuers, both private firms and governments. Credit ratings are market information that is a public good. Therefore, more competition in providing ratings is necessary and the issuer paid business model of providing ratings should be supplemented with non-profit or publicly funded alternatives.
Fourth, sound and sustainable financial intermediation requires an academic theory of individual and firm motivation that rejects the erroneous assumption that rational, self-interest, measured by extrinsic monetary rewards, will lead to perpetually accurate market pricing. Business schools should teach an alternate theory of business behavior which is grounded in the norms of fiduciary stewardship.
The CRT 2012 Global Dialogue was held at the International Conference Center at Caux, Switzerland, on July 30th and 31st.
Caux Round Table, The
Caux Round Table, The
Vision: Our VISION is for a world with - Rising Living Standards, Social Justice and Human Dignity for All Our vision is all about being obsessed with better possibilities for all. This vision is not small; to facilitate change for the better in humanity's ability to raise living standards, provide for social justice and realize the fullness of individual human dignity in all our days is a challenge of massive proportions but it is a challenge we readily accept. To achieve it, we will have to inspire and lead with inspiration and courage.
Mission: Our MISSION is twofold:
* To promote moral capitalism and responsible government
* To ensure greater prosperity, sustainability and fairness in a global economy.
These are our overarching goals and priorities. They translate our vision into a concrete view of our direction and purpose.
We believe Moral Capitalism is the only system with the potential to reduce global poverty and tyranny and address the needs and aspirations of individuals, societies, and nations.
As Stephen Young, the Executive Director of the Caux Round Table has written, "the challenge of moral capitalism is to tip the balance of wealth creation toward humanity's more noble possibilities and away from the dynamics of more brutish behavior."
The Caux Round Table stands for movement from aspiration to action. We straddle the ideals of principles and of ethical concern for the common good and the practical needs of businesses and governments to "get it right" in their actions and decisions. To facilitate implementation of a more moral capitalism, the Caux Round Table provides decision-making guidelines in the form of principles for business, principles for governments, principles for NGOs, and principles for the owners of wealth. The Caux Round Table futher provides a comprehensive risk assessment approach to CSR and stakeholder relationships, Arcturus, and a way of encourageing individuals to reflect on their decision-making styles to move from self-centered frameworks to stakeholder frameworks in business and public policy decision-making. We also provide educational programs for company directors, CSR certificates, and handbooks on CSRT for small and medium size enterprises and on the practice of moral government.
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