Gandhian Concept of Trusteeship -- Corporate Social Responsibility

Gandhian economics is essentially the collection of Gandhi's thoughts on various economic systems. Gandhi was not an economist and he didn’t propound any new economic theory. In his time any discussion on economics was centered around two accepted economic systems - Capitalism and Socialism. Both were rigid in their own terms and even today there is no universally accepted economic system that can be uniformly applied over space and time. Every region can have its characteristic economic system which varies with time. One has to take in to account the prevalent conditions; Socio-political, economic and educational status of the people; comparative advantages and disadvantages of the regional economy etc.
Gandhi’s thoughts on economic systems evolved over time and they incorporated the good of both Capitalism and Socialism. A conservative may identify his views when he reads that Gandhi was against the confiscation of private property. Similarly a liberal socialist identifies his views when he reads about non-recognition of private property, social responsibility of those possessing property etc., Every thought of Gandhi may not be relevant today but Gandhian economics is very comprehensive to deal with many present day issues. One such issue is “Corporate Social Responsibility”, which can be traced to Gandhi’s concept of “Trusteeship”.
Corporate Social Responsibility links Corporate Sector to Social Sector.It is becoming more relevant in our society plagued by increasing inequalities between haves and havenots. Corporate Social Responsibility means that the corporate sector, which earns profit through the sale of its goods and services in the society also has some responsibility towards it. This is essential to promote growth with equity and to achieve an inclusive society. Increasing number of industrial houses are taking active interest in the welfare of the employees, their families and society at large. Starting from the provision of basic necessities like drinking water,primary education, health facilities to the development of environment friendly technologies on regional/national or even international scale, they are working in various spheres. In taking up few initiatives, some of them also have enlightened self-interest in mind. They are not only able to advertise their products but are also selling them to the beneficiaries of their activities. Some of them are involved in the charity work like provision of mid day meals to school children. Many of them have their own NGOs operating at ground level,and in other cases they are involving the civil society in their activities.
Reading Gandhi's concept of trusteeship, we understand that he wanted capitalists to act as trustees (not owners) of their property and conduct themselves in a socially responsible way.
"Believing as he did in non-violence, Gandhi was against the physical liquidation of the capitalists and landlords.Yet their exploitation had to end.This he believed could be done if the landlords and the capitalists acted as trustees of the poor.His doctrine of Trusteeship is designed to work in all spheres of life.Like parents acting as trustees for their children,the government should act as trustees of those who have choosen them to be their representatives in the legislative assemblies. The trustee, by its implications,meant that he is not the owner.The owner is one whose interest he is called upon to protect".
The philosophy of Trusteeship believes in inherent goodness of human beings. It involves the capitalists and landlords in the service of society without any element of coercion. It doesn’t want the destruction of capitalists. Gandhi himself believed that their destruction would result in the end of the workers.

The quest for an ideal society has always has always intrigued man. For this purpose, through odds and ends he has developed many institutions which no doubt have played a significant role in social welfare. But the essence of this quest lies in the ‘realised’ man himself. The Gandhian Concept is based on this understanding and reflects the great philosophy of the Sanatan Dharma. The quest for an ideal society needs many instruments and the various social instruments serve this purpose but they are not the solution to all problems. In fact they often act as an impediment. In a social order two important aspects are economic and control aspects; these two are achieved by institutions of property and state. But problem arises when the overreliance of these makes the whole issue very bitter. The thesis therefore tries to trace the associated problems of the two and the subsequent solution offered by Gandhi. The essence of the entire thesis is meaningful only if a relationship could be found between the Gandhian thoughts and its relevance in modern times; between the proposed idealism and the subsequent sanity, and our demonic times; between the ‘practical’ critic of Gandhian thought and Gandhi’s critique of modern society.

CONCEPT OF PROPERTY

The concept of property is one of the most encompassing and bewildering concepts in Jurisprudence. It encompasses both the concept of rights in rem and rights in personam in its broadest sense and it has incorporated in its ever evolving scope, corporeal and incorporeal property; tangible and intangible property as well rights and encumbrances over the property.

The concept of property cannot be given a definite ambit of confinement. Paton says that it is not possible to give the real essence of property; ‘we can only define it for a particular purpose and that definition is valid only within the given context.’At the same time property can be used to determine the material wealth of different units of society. In this sense property includes whatever which has a present or market value.

Seeing the concept not through a prism but in its restricted sense, the term property means the ownership over the title of the property and in spite of all broad approaches attempted this approach continues to be the real detrimental factor to determine the real wealth in society.

Ownership and consequent transformation into Power­

The concept ownership has its base in the concept of feudalism which played a major role in its conceptualization in the common law. Land was occupied by feudal tenures and denoted such state of affairs which made enjoyment possible as long as a person had claim over the property which was better than others. In this system the feudal lords held lands due to their providing service to the original owner of the land- the Monarchy and the transfer of title was also done by Him. There were in the midst various sub- tenants who employed by the feudal land owners in the serfdoms as landless laborers. These laborers were at the mercy of the landlords. This position changed after the industrial revolution by which time the entrepreneurs in their own capacity began to hold property and wealth while the erstwhile labourers continued to be deprived.

It is in this context that the concept of ownership must be understood. Ownership refers to the right over the title over a ‘thing’ which includes right over both corporeal and incorporeal property. The full rights of an owner includes a) power of enjoyment b) possession which includes right to exclude others c) power to alienate d) power to leave the res by will e) use the property and all its encumbered rights including claims, obligations and immunities provided the necessary limitations of law are adhered to. The owner may grant many or all present rights of enjoyment yet he does retain the magnetic core associated with it. This is because the interest of the owner in the thing in which the ownership is in question will outlast that of other persons.

Power and Property

The earlier forms of social control over the property were that of community ownership. The gradual transformation to private ownership occurred with the control of resources coming into the hands of the few elite in society. The papacy and the feudal lords showed how significant power over society could be exercised by holding property. The same carried forward to the Industrial society with associated social changes. But the industrial world was characterized by laws coming into being which radicalized the social interactions. Therefore laws were created which resulted into institutions coming into being which provided for an equal podium for workers and entrepreneurs to negotiate by brining in the concept of contract of service. But at the same time the owners of the means of the production continued to have the capital and thus carried the quasi-public authority over those with whom they entered into a contract of service. Thus this ownership continued to be a source of power of command.

In the present industrial world, it is argued, that the power has become divested from ownership because of the development of various contemporary institutions and the nature of Modern Corporation. The example of a nominal owner is taken to show that just because he owns a share he cannot be said to have the power to influence society in his favour because the power to control has been has vested away from him. This conceptualisation is based on an archaic view of power of property based on control and ownership of land. The modern world is not based on the exclusive dominance exercised by an individual, but a collection of power exercised in the complex setup of a globalised world. For example the nominal owner often acts in consortium of similar minded persons who together act in furtherance of a common goal. Again due to nontraditional properties like copyright & patents a painter clandestinely stealing a painting of a poor village man and claiming it to be his own creation gets the power incidental to such. Even where power is divested from the owner, property continues to be a source of power.

Marxian Concept of Property

The Marxist analysis begins with an individual staring production and then delegating such when starts to earn profit, but keeping the control of it to himself. Marxian theory states that it the concept of ownership of the means of production coupled with institution of hire that let it happen for as Marx says ‘The capitalist is not a capitalist because he directs, but……because he is a capitalist. The anathema of Marxists makes them comment ‘Private property is robbery, and a state based on private property is a state of robbers’.

Renner gives a much liberal and practical approach saying that the ownership thus attains attained the status of power, for by utilizing the power of dismissal and threat of unemployment and consequent starvation the employer is able to dictate unequal terms of service and control.He also grows into monopolist often and holds the society at ransom. Renner again states that law with the changes in its function would have to take into account the public character of ownership of property by investing it with the characteristics of public law.This attempted controlling of society is the significant aspect of Marxists.

SOCIAL CONTROL OF OWNERSHIP

The social control of ownership characterized in a socialized economy, is generally in the form of transfer of the means of the production into the hands of the state and the direction by a central economic plan. In this logical sequence the state enterprises administer the assets as ‘trust’ rather than having full ownership over them.

It is in this sense that the word Socialism has been used in our Constitution, and it paves way the understanding that material resources of the community are meant to be used for the benefit of the community and to avoid its misuse for selfish ends. Therefore any social control of ownership must act as a protest against the cultural and material poverty inflicted by capitalism on the mass of the people. At the same time any such protest must not result in a social conflict which would be in fact detrimental to the interests of the society. This point must be raised because the above setup often does not yield the desired result. In a socialized state, this setup often becomes a source of state oppression. Examples are abundant from Soviet Union, Cuba, North Korea where the basic human rights are often curtailed in the name of equal distribution. This setup becomes even worse for a democratic country, the essence of which is based on state acting as a representative of the people. But often this setup is molded in a way so that state becomes a guardian and the wards are the citizens and at times this can be a situation of conflict.

India is a Socialist country.The Indian Constitution is molded on broad egalitarian concepts of a socially just order. Therefore, the Constitution envisages a multifaceted system which paves the way for a just and moral social order. But, in every system anomaly between the practice and philosophy must be resolved. The same must also be in India’s case.

Constitutional Directives

The Preamble of the Constitution emphasizes the principle of equality as basic of our Constitution. This concept of equality is not a static but a dynamic and all encompassing process.

The Indian Constitution also has laid down the high principled Directive Principles of State Policy under Part IV by which the state shall try to attain the highest possible level of just and equitable society. Article 39 of the Constitution lays down certain duties for the state which calls for equitable allocation and sustainable development of the state. These tend to ensure that the concentration of the material wealth does not get concentrated in few hands. A problem is supposed to be created due to the conflict between the unenforceability of Direct Principles and the overriding Fundamental Rights. But this setup is only to ensure that the state does not become a Police state in its efforts to fulfill these principles. As per the Constitutional structure these broad based principles are to be gradually phased into the system without having to curtail individual rights. This was the intention of the Constituent Assembly.

It was with supposedly this thinking that the property laws were brought into the mainstay. By the 44th Constitutional Amendment right to property was removed from a Fundamental Right to that of a Constitutional Right by the Janta Dal government of Morarji Desai.

Further Article 31 was amended to bring in Article 31A, 31B and 31C. Article 31A providing for laws for acquisition of estates irrespective of whether violate Art 14 or19; Art 31B giving shelter to laws under the Ninth Schedule and 31C providing protection to laws upholding the Directive Principles. For want of space the present thesis will only concentrate the impact of property laws in our Constitution and in an attempt to relate with the main topic of the paper.

Development from Fundamental Right to Constitutional Right

As already stated the Right to property is no longer a Fundamental Right. The impact of this is a two folded. Impact prior to 1990’s liberalization of the economy and the post session of it. The first step towards the implementation of the DPSP’s was when the abolition of the zamindari was brought by about various state laws. This was meant to enable distribution of land equitably. Later, this was further strengthened by the 44^th Amendment of and the various acquisition laws enacted by the states. Upholding the validity of such laws the Supreme Court has said the DPSP’s mainly the Art 39 are the highest possible equality and any laws which truly fulfills the egalitarian principle will not be affected by the narrow conceptualisation of equality.

This paved way for the DPSP based state action subsiding the individual concerns of equality. At this time India was faced with the concern of creating not only a socially just society but also to ensure that it achieved for itself self development through utilization of its resources.

Therefore the 44^th Amendment was a panacea of its problems.

In Sanjeev Coke Manufacturing Company v. Bharat Coking Coal Ltd coal mines had been nationalized by the Coal Mines (Nationalisation) Act, 1973. The court said that this was justified so as to ensure ‘rational, co-ordinated and scientific development and utilization of coal resources consistent with growing requirements of the country’. The Supreme Court further said that an acquisition which aims to distribute material resources of the community between private and public cannot be invalid. Again in Vellore Electric Corporation v. State of Tamil Nadu the apex court held that power distribution should be a state domain so as to ensure social equality persists.

At the same time the problems associated with such was being increasingly felt. There was inherent problem associated with the right to property being made a mere Constitutional Right. The noted jurist H.M.Seervai has said that the concept of throwing open the question of property in our Constitution is ill founded on the popular conception that Fundamental Rights serves to fulfill the selfish individual needs while the Directive Principles serve the magnanimous concept of serving social needs because it is the individuals through whom the objectives of the country can be fulfilled. The other rights in Art 19 were also mutually exclusive. This transformation would also affect one the principal recipients of a just society- the minorities. Therefore, a land held by the minorities could be taken away by the states in the name of DPSP- a very contradictory principle indeed.

Another aspect of which assumes importance in light of the post liberalization of the economy is that is relation between the economic concerns and socialist mindset. To further enlighten on the point, the new policy of economic development is more on a capitalist society mindset. Here the difficulty of a state controlled system’s coexistence is difficult. The right to property is no longer a fundamental right. The state has a accumulative force over property. But at the same the state is not infallible from going wrong. In the present system of market based economy, corporate system often has an considerable influence over the governance of the country. This often is based on a profit and benefit based orientation. Further, the right to property contrary to popular belief is not just negatively beneficial to the capitalists, it is also a positively beneficial to the large number of poor and deprived class; giving them a right over the material resources of the country. It was for this purpose that the zamindari system was abolished in our country so as to enable the poor to accumulate wealth for themselves also and outright curtailment of this right of theirs hits right at the base of this right.

Art 31(2) was an important provision as it ensured that compensation was paid for acquisition and such acquisition was for public purposes which was in tune with achieving the DPSP’s. The Narmada Bachao Andolan case and the recent dispute at Singur, W.B shows how much this issue of compensation is important and how the state can manipulate it. At the same it would be wrong to equate compensation only in monetary terms. Compensation necessarily means a compensation for loss in terms of sustainable terms. It is to overcome these intricacies of our modern times that the Gandhian concept of economy and trusteeship assumes importance in today’s society.

GANDHIAN CONCEPT OF TRUSTEESHIP

The Gandhian concept of trusteeship to be truly understood must be dealt in the background of Gandhi’s approach towards development. Prior to Gandhi, a conflict of orientation existed in the freedom struggle regarding unifying the people by addressing the then morbid sense of dignity of Indians by following a nationalistic path or whether to achieve it through a secularisation of Hinduism; both were antithesis of each other. Gandhi conversely, until the later part of the freedom struggle, did not lay much stress on the freedom of India, rather he worked for a reformed and self respecting India.Therefore he universalised the freedom struggle by cutting through the tensions between the two. By such spiritualisation of the freedom struggle he helped to establish that a moral spiritual social order was sine qua non for human life at its proper level and this later paved way for the philosophy of social equality in our Constitution.

The essential element of Gandhian thought is the virtue of compromise.This along with Gandhi’s placing man at the forefront in society was the essence of the entire Gandhian philosophy. Gandhi differentiated between society and ‘mass’. Society has an intelligent and overall purpose which mass does not have. Man as a social animal and individually helps society in achieving it because man is given to love, order and purpose

due to his inner consciousness. At the same time, unless the cosmic truth was in existence, man as an individual could not achieve much. In other words, a man who has realised this cosmic reality actually helps to mould the society and help it achieve it highest moral self.

Gandhi sensed that all our resources and possession are at any level, not merely fragments of the divine but are also inherently mortal and mutable. Therefore, Gandhi considered the whole idea of ownership as misleading and a form of violence. It implies right and privileges over Man and Nature that go beyond the limits of Human law and social custom. It gives rise to unwarrantable attachments and insupportable expectations.This kind of possession not only turns away man from the deeper odyssey of his existence but also breeds possessiveness, revenge and exploitation and therefore breeds not only social tension but conflict within the individual. But in Gandhian terms guilt free enjoyment is inseparable from ethical probity Therefore, the issue is not how much or how little we achieve in the way of talent or property, but the reasons and motives behind their allocation and uses.

The Gandhian economical concept is based on what he called ‘Aparigraha’-non possession, non acquisition and minimization of wants. Gandhi’s economics is based on the upliftment of human life rather than a mere standard of living with scant respect of human and social values.Therefore under Gandhian order the characteristic social order is based on social necessity and not personal greed. Resources are for everybody and wealth is for those who generate it. Thus one who controls the resources is not the owner but the trustee.

The concept of Trusteeship therefore supposes that the Capitalist act as the trustees of society’s resources and therefore serve an answer to the economic inequalities of ownership and income and ensure a non violent resolving of social and economical inequalities. It is here that Gandhi departs from Marx. The latter talks of destruction of the exploitative social order but Gandhi talks of a constructive order based on reformation of such exploiters. While Marx’s tends to bring further strife in the existing system, Gandhi reforms man. Gandhi supplements the concept of socialism with social trusteeship. He does not therefore exclude legislation of ownership but talks of a state regulated trusteeship.

Gandhi deals with the concept of trusteeship at four different levels.

Firstly, he talks of Trusteeship as the sole means of continuously redistributing wealth and simultaneously assures the generation and intelligent use of wealth. This is an outcome of non-violence, for wealth could be redistributed coercively but the resulting greed of many and the resentment of the displaced paves way for social strife and self-alienation. The trusteeship therefore provides the owner the satisfaction of seeing himself as trustees of the wealth of the society.

Secondly, the concept of trustee was based on Gandhi’s practical psychological intuition. Gandhi understood the great value of acceptability in a stable social order. A proper redistribution can only be achieved when the element of fear is no longer is a repealing factor. Fear, which he symbolises with weakness, creates an environment of distrust and hiding in a coop of self-protective formulations. This can only be countered by a fundamental change by creative, tolerant activity; sense of dignity and courage. The workers realise their importance in society and shed the fear of and distrust of the rich while the latter will no longer feel their existence threatened but would realise their great responsibility towards upliftment of society.

Thirdly, Gandhi said that the trusteeship concept could be achieved by implementing in degrees. He was bowed down by the fear of failure considering that if it did fails it would be one of the many conventional social proposals. But it was a success, its strength would be the principle and it would not have the weakness of inflexibility by creating spaces fro adjustment. Another strength of it was that action of a few towards it could break mental barrier which so subdues progress. Gradually, statutory trusteeship could be evoked where trustee’s power of appointment and states power of review will strike a balance for the welfare of people.

Fourthly, the time of Gandhi, as presently, was characterized by spiritual poverty and psychological failure. That made him visualize that the time was ripe for implementing a change.

Gandhi based his system on a simple society but he did not just was biased towards an agrarian economy. Contrary to popular belief he did not reject technology. He never talked against the deployment of machinery and heavy engineering based industry. Rather he believed that technology was good if people needed work. He believed in the concept of appropriate technology and associated self reliance associated with it.Therefore, the Spinning Wheel is the replica of technology at the village level and which symbolises self reliance. What Gandhi opposed was the craze for industry. Gandhi advocated the development of village economy through setting up of village industries which would meet the huge demands of rural markets and also ensure jobs. This becomes very significant in light of the huge migration of labour forces seen throughout the world which hampers not only hampers the village economy but is also bedrock of many social problems like labour exploitation, human trafficking, flesh trade etc.

It is due to this that Gandhi laid so much importance on village empowerment based on the visualization of his concept of Swaraj. Gandhi wanted a village economy based on self sufficiency and permance. Two factors whose need is increasingly being felt in light of the recent financial crisis.

Naxalism is one of the primary menaces facing India. But this is nothing but the negative impact of fear and dejection of the continuously deprived section of the economy over a period of time. The government proposes to launch operation a anti-Naxal movement. The outcome of such is highly controversial and is highly to fail. What is the best solution to the problem is development of the village economy as whole along with restoration of the faith of those who have deviated.

Contrarily, a positive implementation of Gandhian approach shows us how Lok Adalat based on Gandhi’s concept of village panchayat can achieve a quick and socially justifiable solution without affecting the social fabric by enlightment of the outlook of the disputants.

At the industry level, the position of trustee is given due importance and respect by Gandhi. This assumes importance in light of the role played by Corporations in today’s world. By looking for a equitable balance of balance of all the stakeholders the today’s entrepreneur takes the first step towards tomorrow’s trustee. Gandhi’s concept has evolved the concept of ‘Global Satyagraha’which can be used to find financial solutions to important aspects like foundational purpose of a financial system, how to make financial systems inclusive, financial equity by linking social equity, environmental stability and self reliance. The current economic crisis has also made the need of an sustainable economy a prerequisite by engaging in public policy debate.

Gandhi did not stand for Globalization in its present form but rather called for a ‘Villages of the Globe’. Therefore, each country was a village in the globe. This prevents a few developed nations from dominating the developed countries in their quest for development. This also supplements the state’s overall development because it aims for self sustenance. Gandhi’s concept of trusteeship therefore has a pragmatic approach as in such a situation the developed countries can assume the responsibility of a trustee by using its power for the sustainable development of mankind. Further, such an approach can also ensure environmental protection by not only ensuring that environmental friendly means of production are used but also ensures that the present stalement of talks as seen in the backdrop of the Barcelona Conference and the Copeenham talks of the United Nations are provided with a amiable solution. The developed nations can take steps and show how sustainable steps can be taken be achieved though enviro-clean policies.

To Gandhi, a man’s ultimate duty to seek after the Absolute Truth which is not different from God. An animal has no requirement to search for truth but men’s conquest of truth which is not a mundane one entails that man is essentially a spiritual being. The inner self in the human being his prime mover, the man is not to be identified with his physique. Thus Gandhi advocated the Upanishad’s concept of man i.e. with the physical death of the body the spirit within does not die.

In Gandhian scheme of things it is the individual that is the Central figure so far as societal good is concerned. Gandhi does not discard individuality at the alter of the society. As opposed to Marxian concept of socialism, Gandhi considers that socialism must not negate individualism, for it is the individual that can usher in and protect societal interest. It is no good to direct man of the means of production because the argument that if the society or the state is seized and possessed of means of production there will be equitable distribution of wealth and augmentation of production is a false dilemma. On the contrary, such a system in ultimate analysis invites stagnation of growth and arrest of intellectual excellence of an individual. Gandhi views that production of an object by man is more important than the one coming out of a machine; the two products being conceptually different. The man puts his heart and soul, his concept of beauty when he produces an object. When a man’s inner spirit is ignited, he as a possessor of object will not really possess for himself and his possession will be one for the other. This is what is called trusteeship. However, utopian and absurd one conceiver of the concept, there is for Gandhi, no other way out, Gandhi was conscious that perish ability of a material being an individual must known of a seeker after the truth cannot run after mundane pleasures. The Upanishad concept of ‘nivritti’ entails that wealth does not belong to anybody and a practitioner of non-violence, as Gandhi was cannot lead the nation in opposite direction. The idea that he is the trustee of the property for other case best be achieved, for Gandhi, by practice of non-violence and a non-violent being cannot in any circumstances whatsoever be averse to social good. And Gandhi himself is an example of his philosophy and he has demonstrated that the idea is not an abstract one. A society is composed of individuals, and as excellence of an individual is of paramount importance. A practitioner of non-violence does not really possess for himself beyond what he barely needs for him. In essence, possessiveness and non-violence run counter to each other. For an ideal society to live in which aims at empowerment this is best possible system. Recent experience around the world has testified to the relevance of the concept of trusteeship as the Mahatma propounded for the people.

The question of validity of Gandhism is inseparable from its universality. To state that Gandhism is irrelevant standing on a flawed board is trying to push a concrete wall when the passage is just beside it. Gandhi aimed for a normal society and this theory becomes significant as soon as there is a change in the nature of our orientations.