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Companies that score high in terms of the human development enterprise index tend to do better in terms of economic and employment performanceThe HDE is made up of four components
Mr. G. Standing, Employment and Training Department, ILO
Summary of proceedings:
The ILO has collected information from senior managers and employers in over 15,000 enterprises in 18 countries through enterprise labour flexibility surveys. With these data the ILO has developed indices of good labour and employment practices called the human development enterprise index (HDE), a measure of social responsibility. Companies that score high in terms of the human development enterprise index tend to do better in terms of economic and employment performance.
The HDE is made up of four components comprising the elements listed below:
HDE 1: The Skill Development Firm
initial training
retraining for performance
retraining for upgrading
funding and facilities for training
HDE 2: The Socially Equitable Firm
does not discriminate gender, race, religion, disability
corrects discrimination and disadvantage
promotes safe and healthy working conditions
HDE 3: The Economically Equitable Firm
minimises members' income differences
prioritizes improving income security of the worst-off
recognizes that economic equity promotes productivity
HDE 4: The Economically Democratic Firm
determined by consensus of stakeholder groups defined within national structure or culture political democracy requires labour market democracy
Discussion was directed towards the HDE's methodology, the composition of its indices, the validity and possible uses of the approach, and its extension or diversification to various types of enterprises, "enterprise-systems", or types of businesses, cultures and contexts. The HDE index provides a basis for bench marking. It can be seen as complementary to the value and organizational-culture-driven view of enterprise "social responsibility" presented by the World Business Academy. It can be adapted and developed further in order to go beyond single enterprise "establishments" and become valid for multi-unit enterprises, and also encompass integrated "enterprise-systems" comprised of one or more central enterprises together with partners, alliances, suppliers, contractors or distributors.
How a firm becomes "progressive", or "human development"-oriented, or "socially responsible", may be primarily a matter of organizational mind-set, culture, or stakeholder and leadership values. When these are intelligent, broad, and long-term oriented, they can induce the enterprise-system to view and integrate social initiatives and economic efficiency as elements of an unified business strategy. But empirical assessment and measurement of concrete cases, enterprise performance, indicators, achievements, and short or long term costs and benefits and trade-offs, can be an important factor both in shaping and creating these desirable "soft factors", while also allowing measurement of progress towards one or more "ideal enterprise-system models".