I spent the last day in Sri Lanka on a trip over to the Eastern side of the island and the picturesque town of Trincomalee. Trinco, as it’s known, has one of the world’s finest deep-water harbours and is pretty as a picture, especially when it’s at peace (which it appears to be now).  The surfing is great, the sparkling sea teems with fish and the ‘Cultural Triangle’ of ancient archaeological sites is just down the road.

I got a lift over from the Sri Lankan airforce in one of their battered and noisy Chinese Harbin Y-12 planes. It beats the dusty 8-hour road trip. When we arrived at the China Bay airbase we were met by naval gunboat. A number of these vessels were blown up by Tamil suicide speed boats - shaped like waterborne Stealth Fighters - during the conflict.

Funnily enough just before departure I’d seen on the BBC’s website that Primark had been rumbled for using child labour on Southern India to make its clothing. The kids were Sri Lankan refugees.

The economy over here in the East is on its arse. Years of bombings, gunfights, abductions and urban riots have seen to that. Tourism has all but dried up; the infrastructure needs a lot of work after years of fighting. But there is real hope. The sun keeps shining here while the monsoon pours on the Western side of the island.

In the meantime, the ubiquitous aid agencies who flocked here after the 2004 Tsunami are still very much in evidence. You can spot them a mile off in their vehicle of choice worldwide – the Toyota Land Cruiser. Aid is a complex business here – not least because the conflict has caused the displacement of tens of thousands of people who need help. But I met several Sri Lankan officials – people a lot more reasonable than the Burmese Junta - who expressed disquiet about the continuing presence of these NGOs. They don’t have a proper list of who they are, how many of them are still on the ground, or what they are doing.

Some suspect that the charities, many of whom are Christian, are engaged in religious conversions – and that’s a highly sensitive area in a country where religion has been at the heart of its troubles for the last 30 years (Trincomalee has a delicate mix of Hindu Tamils, Buddhist Singhalese and Muslims).   

Most importantly, if large numbers of people become accustomed to the dependency culture of aid, i.e. receiving handouts to meet their daily needs, then they have little incentive to get up and get on with it. Getting the economy back onto its feet will be one of the principle challenges faced by the new Chief Minister Pillayan, whom I interviewed yesterday.

I was still thinking about this later when I read a really excellent piece in Prospect magazine about the failings of aid in Afghanistan. It’s a hideous irony that aid, given often from the purest of motives, can wind up causing such a mess because of the cack-handed way in which it is delivered.

I first visited Sri Lanka sixteen years ago. On the morning of arrival, I was slumbering in my room at the colonial Galle Face hotel in Colombo, looking forward to a fortnight exploring the island Marco Polo described as 'the finest in the world', when I was roused by the loudest bang I’ve ever heard in my life. A sprint to the window revealed a plume of smoke rising from the other side of the road: a member of the LTTE (Liberation Tigers of Tamil Eeelam) with a large bomb in a rucksack had driven his moped into the limo of Admiral Wannakuwatta Waduge Erwin Clancy Fernando, an Admiral from the Sri Lankan fleet. The poor man’s plimsolls are probably still in orbit.  

That was my first encounter with Tigers and I’ve tried to avoid getting up close and personal with them ever since. But when I was interviewing Sri Lanka’s president Mahinda Rajapaksa, and he suggested I might like to meet Sivanesathurai Chandrakanth, aka Pillayan, I couldn’t say no.  Pillayan - who is still only in his early 30s - was taken from his family aged 15 by the Tigers, and has spent all his adult life as a terrorist involved in a ferocious conflict that has claimed the lives of 70,000 since 1983. Until last year - when, after handing in his rocket-propelled grenade launcher and some extraordinary political manoeuvring, he was elected Chief Minister for Sri Lanka’s Eastern province. A bit like the Americans making Bin Laden mayor of the Windy City.

Interviewing was an odd experience, not least because my Tamil isn’t up to much. His right-hand-man (who looked way under 30) did the translation. Pillayan now has a price of millions of rupees on his head as one of the most notorious turncoats of the whole Tamil struggle (the bounty might well come from one of the credit card scams that the Tigers have been caught running in UK petrol stations).

He’s unrepentant about his conversion to the ballot box. 'The Tamil people are completely fed up with war', said Pillayan. 'A separate country was their desired solution and it’s completely impossible to achieve that. Their leaders have missed their chances and a solution for our people is very important. A democratic way is the only way.' Did he think an end to the military conflict was in sight? 'For the first time now the Tigers are very loose and very weak. They’ve lost most of their important commanders and the Sri Lankan forces are going very well.' The aim is now to annihilate the LTTE completely by military means.      

As one of the world's deadliest ongoing armed conflicts, the Sri Lankan civil war has caused enormous harm to the population, especially in the North and East, and severe damage to the country’s economy. Tourism has dropped off badly since resumption of fighting in 2005 and the effects of the Boxing day Tsunami on 2004, which killed about 35,000 people. 

One suspects that the conflict is the single thing holding Sri Lanka back from what is potentially a bright economic future. Despite all its problems, it’s already got the highest per capita income in South Asia. Later, at a meeting with 50 of the country’s top business people, I realised that they see the future as a sort of off-shore powerhouse snuggling in under India’s coat-tails. They are an earnest and enthusiastic lot. And tourism? Well the sky is the limit. 'Where in the world,' demanded one businessman in the tourism game, 'can you see the two largest animals on the planet in one national park in one day?' Elephants and whales are free for inspection, within a few miles of each other, any time you wish to drop by.  Best avoid the Tigers, though.

It’s hot, sweaty and frenetic on Colombo’s streets at this time of year, as the monsoon rain sheets down. The scene inside the Brandix eco-factory, however, is one of calm, quiet industry in a carefully temperature- and humidity-controlled environment. Piped music of tropical birds fills the air to accompany the gentle whizz and whirr of the sewing machines.

The Brandix plant at Seeduwa, in Colombo’s suburbs, is Sri Lanka’s answer to the call of Sir Stuart Rose’s Plan A. Ashroff Omar, the far-sighted CEO of Brandix, can see which way the sustainable wind is blowing and has just spent £1.25m converting one of his older apparel factories into this ‘green’ establishment; as a result, carbon emissions are down by 75%, energy usage by 45% and water consumption by 60%.  There’s a new a/c system, natural lighting, rainwater is collected and none of the waste goes to landfill. To celebrate the opening, Lasith ‘the Slinger’ Malinga from the national cricket team was hired to show Al Gore’s ‘Inconvenient Truth’ movie (with Singhalese subtitles) to the entire Brandix workforce of 1600.

Sir Stuart, who visited in April to cut the ribbon, is pleased – and so is Mr Omar, who generously described the M&S knight as ‘probably the world’s most potent warrior saving the environment’. The (mostly female) 300 employees at Seeduwa earn about £80 per month for a 57 hour week and get 90 days paid maternity leave. In a Bangladeshi sweat shop, says one Brandix manager, the figure is only £25 per month.

As the slowdown bites and pressure on suppliers by UK retailers grows ever stronger, this sort of endeavour will be put to the test. Brandix turns over £170m a year and operates above the cut-throat basement market - it does shorter orders of more complicated items and can turn batches round quickly. But the eco-factor is now one of the new forces in globalization. With fuel costs rising so rapidly, Brandix knows this eco-refit will pay for itself in 4 years. And who knows, maybe Plan B will eventually demand that suppliers adopt environmentally friendly working practices.   Brandix also produces garments for Abercrombie & Fitch and Gap, while its biggest customer is Victoria’s Secret – but so far it’s the Europeans who have shown more interest in sustainability.

But the Sri Lankans are now anxious. After the tsunami wrecked its eastern coastline, they were given an exemption from EU import tariffs on textiles (40% of Lankan exports go to Europe and tourism has been dealt a blow by the unpredictable security situation, as the bitter war with the Tamil Tiger LTTE continues in the North). This tax exemption is now up for review and could, if removed, add 10 per cent to the cost of a pair of Sir Stuart’s underpants.  

Tomorrow, by the way, I meet a reformed Tiger boy soldier just made a Chief Minister...

The answer is none – 'but it would be nice if we were represented at the meeting'. (I was told that joke by someone from the FT, so don’t blame me.)

I thought about it when I read our brilliant Global Salary Survey feature, one of the highlights of MT’s June edition. Its headline finding this time round is that in the UK we pay our HR directors more than anywhere else in the world – a whopping £327,300 on average. That’s just a whisker under the figure the average FD gets in the USA (£342,284) – and in the States they pay FDs more than anywhere else. This revelation had our old friend and MT contributor Luke Johnson, serial entrepreneur and chairman of Channel 4, protesting: ‘I suspect that part of the reason why big companies in Britain are not as productive or entrepreneurial as they could be is because they misallocate rewards like this. Administrators are a necessary evil, but business-getters and leaders are the ones who create enterprises, not bureaucrats.’

You can sort of see where Luke is coming from. But then once you start to imagine how large organisations would fare without an HR ‘function’ you realise how quickly things might come unstuck. It’s all very well saying that HR doesn’t contribute – that it’s part of a corporate bureaucracy that just consumes revenue – but any medium to large size business that didn’t have it would find things very hard going indeed.  Who’s going to do the tricky ‘people’ bits that line-managers can’t cope with? The finance director? IT? God forbid.

These days it’s not just payroll, pensions and working out maternity leave (not that any of these is insignificant). Any organisation that doesn’t realise its people form a vital part of its success is kidding itself. So what has HR ever done for us, to paraphrase the legendary scene from The Life of Brian? When it’s performing its job properly, there’s: 1) ensuring the right talent gets in through the door and that the organisation hangs onto it; 2) learning and training, which makes any organisation collectively get better at what it does; 3) dealing with unhappy people carefully before things get out of hand; 4) keeping an eye on employee engagement levels which, as the economy cuts up rough, becomes even more vital than ever; and 5) making sure each and every member of the organisation understands what the culture and brand stand for. One could add to this list for quite a while.

But in practice, how many of us could say that the HR department does these things brilliantly and is listened to attentively at board level?  (Certainly not Luke Johnson) Done badly, HR inhabits and perpetuates the grim old days of ‘Personnel’. Done badly, it’s a backwater where the semi-detached or those who haven’t cut the mustard get shoved because nobody can work out what to do with them.

Yet the most admired organisations only become so by doing it well.