Each month when I open my pay slip, while remaining thankful that I am still employed, I can see exactly how much I contribute to the public purse in income tax and national insurance. I pay this money willingly in exchange for living in a democracy, and in joyful hope that my contribution is spent wisely on goods and services that benefit not just our economy but our society too. Although, as yet, I have had little need for some of the public services that are available, they remain part of the fabric of a society that cares for the weak, the vulnerable, and the sick.
The recent media interest in the delivery of care for the elderly has been unusual in that it has been concerned with the governance of care homes and not the quality of care. This makes a refreshing change and hopefully is a reflection of improving standards in care for the elderly. However the improved standards have been costly to implement and in the current economic climate just about every organisation has been forced to review the effectiveness and efficiency of their business model.
Although there are still several hundred local authority, NHS, and voluntary sector owned care homes in the UK, the delivery of care for the elderly is dominated by private sector. However the service is paid for by individuals, their families, and local authorities. As a tax payer, and therefore a contributor to the budgets that pay for care, my preference is that any contribution is actually spent on providing the best care to those that need it, and not dissipated on costs, emoluments and other disbursements. Private sector business models are not obliged to offer such protection, and nor should we expect them to as their governance model primarily, but not exclusively, obliges them to pursue strategies that serve the interests of their shareholders. However when the interests of shareholders conflict with the interests of stakeholders, in this case the elderly, it is time to rethink a business model that allows the long term viability of an organisation to be put at risk. And with an ageing population, the need to find a new business model is pressing.
Care home residents, and their families, need to know that the services provided in a home will be caring, high quality, consistent, and continuous. We need to know that if mum or dad is happy in a home they will not be forced to move. Providing care for the elderly therefore requires investment in a long term business model that prioritises the continuity of high quality care for the elderly above short term profit maximisation in the interests of shareholders.
Social enterprises, community interest companies, and cooperatives lead the way in adopting the long-term oriented, stakeholder-led business models that the care sector needs. As yet, very few operate in the residential care service and we urgently need to develop business models for the care sector that place equal value on financial sustainability and high quality care.
Caring for the elderly should not be a business aiming for profit, it should be a financially sustainable service guided by the values of compassion.
Dr Helen Haugh is the deputy director of the MBA Programme and senior lecturer in Community Enterprise at the University of Cambridge Judge Business School
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