The Ceylon Chamber is Ineffective. Meet the man trying to fix it.

For nearly two centuries the Ceylon Chamber has been managed by a chairman selected from among its members. In recent times this has been its greatest weakness

By Shamindra Kulamannage.

Published on December 03, 2014 with No Comments


Its position at the crossroads of trade and plentiful resources attracted enterprising English businessmen to the island over 200 years ago. Ceylon’s location at the centre of maritime crossroads and the exotic spices grown here had for centuries before focused the attention of expansionist European kingdoms on the island.

Once their grip on power was complete, the British planted coffee, tea and rubber in the hinterland and organised the Ceylon Chamber of Commerce – often referred to as the Chamber – 175 years ago. In 1862, they successfully lobbied the government to build the Colombo-to-Kandy railway to efficiently transport this produce and, in 1869, convinced the state to develop Colombo as a major port to export it.
Concessions from the administration allowed these frontier investors to clear tens of thousands of acres of forest land and, when the natives refused to work for them, belligerently import labour from Southern India to plant tea. In its first century, the Chamber was a gutsy and effective advocate for private entrepreneurship, lobbying the occupying British administration for infrastructure that allowed members to efficiently plunder Ceylon’s resources. Elite mercantile establishments in Colombo and the plantations, controlled by European immigrants, wielded unprecedented policy influence through the Chamber.

Over 175 years after the Chamber’s founding, the country’s predicament couldn’t be starker. Sri Lanka is no longer a colony managed for the enrichment of a brutal empire; it is a democracy and businesses here are more diverse. The Chamber’s vision now recognises a need to be a force for both economic, as well as social, development.
However, over the past decades, the Chamber’s influence as a business lobby – which is the only reason for its existence – has ebbed. Its leadership and membership represent the island’s largest enterprises, and its loose associations with regional and industry specialist bodies place it at the apex of private sector lobbies. That it isn’t as effective as it should be is recognised by its leadership.
Suresh Shah, its current Chairman, is determined to reverse this decline. “Over the years, I think we may have bent in one direction or the other, and that may have been too much. As a result of this, I think the Chamber’s position of influence has been affected,” he admits.
“So we need to correct it. But we have to also understand that we won’t be able to meet the needs of all our stakeholders on every issue,” he cautions. Shah does not apportion blame, but highlights that the Chamber has been consistent regarding the principles it supports. These principles are the need to be a force for economic and social development. “At the end of the day, the Chamber tries to influence policy and, if we try to influence policy, we must also be responsible to the general public. We can’t be influencing policy only for our benefit. There must be a national interest.”

“The second thing is, we believe in market-driven economic policies. We’ve been very consistent on those two objectives.”
To reclaim its role as the most effective lobby for free enterprise, the Chamber is changing things at its core, which is to shift overall responsibility for the outcome of policy influence from the elected chamber leadership to the secretariat headed by the Chief Executive.
A four-member committee headed by Jayampathi Bandaranayake – a former Chamber chairman himself – is crafting changes to the organisation’s constitution that will permanently shift executive responsibility from its elected membership to the executive. Mangala Yapa, a former Chief Executive of shipbuilder Colombo Dockyards who was recently appointed Chamber CEO, will be the first executive to hold responsibility for a complex series of outcomes once the membership approves the proposed changes to the organisation’s constitution. These amendments will be proposed in a few months.
The Chamber membership consists of around 500 corporations, many of which are listed. However, it also represents over 3,500 other businesses through affiliations with regional chambers and specialist industry groups.
Clearly, a waning of the Chamber’s effectiveness as a business lobby allows other special interest groups disproportionate influence on policy, leaves the private sector rudderless on controversial issues and ceases to serve its members. The new Chief Executive’s primary role will be to rebuild the Chamber’s lobbying power to reflect not just the big businesses that are its members, but also the thousands of other private sector organisations loosely associated with it.
Although the office of Chief Executive was created a decade ago, leadership remains with the Committee consisting of the Chairman, Deputy Chairman, Deputy Vice Chairman and Immediate Past Chairman. A wider grouping called the Standing Committee ‘A’ and the Committee ‘provide effective governance and maintain the right balance for the Chamber’s smooth functioning,’ according to its annual report. ‘The Chief Executive is subject to the general direction and control of the Committee,’ according to the Chamber’s current constitution. This is the balance of power Shah is determined to alter.
Shah says the transition to an executive- and secretariat-led model is a process discussed during the tenure of former chairman Susantha Ratnayake and before. “We come here only so many times a month,” says Shah, who is the Chief Executive of the Carson’s group subsidiary that bottles Lion, Carlsberg and other brands of beer. “What we call Standing Committee A, being in a sense a body that sets the framework and also acts more as a sounding board.”

Shah uses a business analogy to illustrate how the relationship with the policy setter – the government – works. “Let me try to explain it this way. Let’s say you’re doing business in a partnership and you want to take an issue up with your partner. What do you do? Do you go around telling everyone else your problem with your business partner, or do you sit with him and have a frank and open discussion? You engage and you try to resolve the issue. We believe that is the best process because at the end of the day, our role isn’t to be seen as heroes,” Shah says about the choice the Chamber faces when countering policy proposals that are at odds with the group’s own beliefs.
“We need to able to, within a certain set of principles, get our point of view across and get people to see our perspective. So you’ve got to work alongside.”
An example is the land bill that was passed into law recently. It was first announced in 2012. Subsequently a circular was issued “which brought some sort of balance to the issue,” Shah says. “But when the draft bill was presented, it went contrary to that circular, and then we started working on it.” The chamber issued a release with recommendations on possible amendments. “In the meanwhile, there was a lot of efforts made to discuss the issues with different parties. We met many people, we wrote to many people, we’ve asked people for appointments, and it was only at the very end that we put out a statement to the general public outlining the Chamber’s position.”
To be heard in this new economic order, the Chamber will need to build a research- and evidence-based case for policy reform, defend the cause of free enterprise in the judicial system, build a more inclusive membership that can also fund its wider remit and become a lobbying powerhouse.
Shah shrugs off the burden of history when it comes to altering constitutional provisions, some of which have been in place for a century or more.

A more assertive chamber defending free enterprise will serve its members better than the current setup. It takes bold leadership to go beyond merely tinkering with the model and in Suresh Shah the Chamber has someone who won’t be satisfied with a short-term fix.


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