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commentary

Brexit after Brexit

Now that Brexit is on its way, everyone is trying to work out what it means. I believe the most profound implications are not about the re-configuration of the UK’s political parties, or the length of time withdrawal may take, or the possible economic impact – or even the fragmentation of the United Kingdom.

The most important implications will be what it means for social conditions and the environment. Brexit is a giant exercise in re-regulation.

Clearly part of the motive for leaving was to achieve a reduction in the regulation of business. I fear that will mean harder working conditions for the majority of the very people that voted to leave. But what no-one is talking about is a possible relaxation in environmental regulation.

It will be a Pyrrhic victory for Britain if the planet is defeated.

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commentary

What attitude should companies take to Russia?

Russia has annexed Crimea – what is a company to do about it? Russia has ignored due process in annexing the Crimea, yet the level of popular support for Russia in the Crimea seems very high. And Ukraine is clearly split – but then it has been tossed between higher powers, like so much of Europe, for much of the past millennium.

No doubt there will be some companies that are instructed to implement the sanctions that the US and EU have agreed – but what about all the others? Should they show solidarity with the West in some way? Should that follow the precedent of the sanctions – effectively  harassing Russian citizens? Would it mean avoiding business with Russia? Should energy companies seek alternative supplies of gas, for example? And perhaps those companies with ties to Russia should do the reverse? Should Russian-owned football clubs stage pro-Russia events?

That would simply inflame the situation.

In reaction, some will say that companies have no business in politics and want to get on with business as usual, avoiding politics altogether. Yet it is probably just the same companies that are busy lobbying governments hard behind the scenes to legislate in their interest. Isn’t that political?

And there are some political situations that are so horrific that action by companies seems entirely justified: the apartheid era in South Africa was one. Yet even in this case there was considerable debate about whether the sanctions hurt the very people they were designed to help. Of course in such cases much will depend on what the people affected actually want to happen.

There are a few lessons here:

  1. political situations by their nature are extremely complex and always different – so there are no general rules for action, or for inaction
  2. the fact that there are no rules does not mean that companies can just ignore such issues; they have a moral duty to work out what their attitude should be
  3. it is reasonable to ask any company (for which the Russian situation is relevant) just what their attitude towards Russia may be.
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announcements

Companies: too much like citizens

How much do we want to share our democracy with companies? There’s no doubt a place for companies to make stuff and sell it – but should there be a place for them to pay for political parties and influence party policies? Individuals have the right to petition and influence their rulers, but should companies also have it? At the moment, companies do it freely. It is called lobbying.

As David Cameron has said, lobbying “exposes the far-too-cosy relationship between politics, government, business and money…in some cases MPs are approached more than 100 times a week by lobbyists.” So we might guess that irrespective of any corporate donations to the Conservative Party, David Cameron is probably itching to remove Lynton Crosby from the ranks of party advisers. Just so that there can be no perception that the failure to implement tobacco controls or alcohol limits has anything to do with lobbying.

What about the companies involved? A search of the Philip Morris website for the term ‘lobbying’ returns no results. Do the same thing on BAT’s website and this page turns up. So there are different levels of awareness out there that transparency over lobbying is part of what earns a company its licence to operate.

Perhaps the phrase ‘corporate citizenship’ should not just elicit a warm and fuzzy feeling. As I have argued before, it also has its dangers.

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commentary

What went wrong at Rio?

How did it happen that Rio+20 is universally seen as a failure? The best that can be said is that it was a disappointment. And Greenpeace’s view of the agreement is vitriolic:

“Gone from the Rio agreement is a commitment to end subsidies to the fossil fuel industry. Gone is any clear commitment to protect our oceans from over-fishing and pollution. The money needed to pay for clean energy, and to ensure that the growing world population has access to decent food and clean water, is no-where to be seen. Again, our leaders have reminded us that whilst cash can be found to pursue wars and to rescue banks, nothing is left to help billions of people out of poverty or protect the ecosystems upon which human life ultimately depends.”

The most interesting explanation comes from Gro Harlem Brundtland, who agreed with the suggestion of the BBC that the power of corporations was a key part of the problem. But so little transparency is there over how corporations lobby that we don’t even know who lobbied whom – let alone what they said.

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commentary

Responsibility for Europe

Europe teeters on the edge of the Eurozone and markets thrash. So whose fault is it?

Is it the fault of those who cannot pay back their loans (poorer countries like Greece)? Or of those who made them in the first place (richer countries like Germany and investors in debt)? No doubt both sides are guilty to some extent.

But what all sides are equally guilty of is blind faith in ‘the market’. Markets will not reflect reality unless:

  • participants know the underlying economic situation of the other party
  • failure to honour a debt is always punished.

Yet the first proposition is usually untrue and the second is both untrue and undesirable.

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commentary

Pay and bonuses: we need to know more

In Norway, the income and tax paid by every citizen is on the web. Perhaps the UK isn’t quite ready for the Norwegian system, but how can there be a proper debate about pay, tax and bonuses if we don’t know what anyone gets?

We now know that Network Rail bosses are not taking their bonus. And we know that Goldman Sachs bankers are said to get £1/4m on average. Shouldn’t we also know at least the ratio of highest compensation to lowest compensation (and to the average) within any organisation? The Network Rail Sustainability Report does not mention the issue of pay, except to talk about how much its staff are giving to charity as if Network Rail had given it.

We should start with this kind of transparency for all organisations in which the state has a controlling stake. Isn’t this one of the things that being a stakeholder is supposed to be all about?

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commentary

Democracy leaks

When Wikileaks made its disclosures about the war, the banks’ paymasters – Visa, MasterCard and Paypal – panicked. The decision to deprive Wikileaks of the means to receive money has nearly brought it down.

Is this a victory for law and order or the suppression of the right to free speech and a frustration of democracy?

By deciding to take action against Wikileaks before any crime by Wikileaks had been proved, they are setting a very dangerous precedent: if such pre-emptive action is justified, why do they not take action against all sorts of other people and organisations that have been accused of a crime? Are racist organizations denied their services?

No doubt they will have a worked-through policy for which activities they are prepared to block on their own account before knowing that a crime has been committed. If they think of themselves as ‘corporate citizens’, we should be told about this policy and how it led to the Wikileaks decision. Or perhaps they don’t have one…

Maybe next time they won’t react quite so swiftly.

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commentary

Against business – or against bad business?

The BBC is positioning Ed Miliband as anti-business after his call for a new model of business. This is not because of what business has said, as a look at the IOD and CBI websites reveals.

The IOD seems to accept that there are good businesses and bad ones. They simply ask for clarity on what the reward and punishment system might look like and wonder how good government would be at discriminating between the good and the bad. The CBI however seems to be against any kind of discrimination between businesses – such as that some are asset-strippers – just in case it hurts growth. Although it goes on to say that there are indeed responsible businesses.

Has the BBC’s hunger for a headline interfered with its judgement?

Categories
commentary

Transparently in Trouble

The current controversies about transparency, privacy and free speech raise very many issues:

  • the difference between the public interest and what the public is interested in
  • the relative access to justice of the rich and of the poor
  • the right roles of parliament and the courts
  • the balancing of privacy against freedom of expression
  • the awkwardness of laws designed for concentrated, national means of expression (newspapers) being applied to the internationally distributed technologies of the internet (Twitter).

Yet what all of these debates should take account of is the difference between the rights enjoyed by companies and those enjoyed by real people. There should be no presumption that a case for protecting the privacy of individuals is also a case for companies to be able to enjoy the same protection. Yet currently companies enjoy human rights, including privacy, in the same way as do people.

The injustice this can lead to was well illustrated by Trafigura. That company successfully, at first, sought to conceal information on its dumping of toxic wastes through a super-injunction (in which not only the underlying facts, but also the existence of the injunction itself is concealed). This kind of use of the law is merely an instrument of reputation management. It should never be allowed to trump the public interest.

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commentary

Feeding Frenzy

The IDS of Sussex University has just released a report that addresses the world’s need for food. Yet the headlines say the the world needs GM and new technologies. What is going on?

The report was produced for the UK government’s BIS. It points out that the reasons for hunger today are complex, including political factors as much as technology. This is consistent with the FAO view that the world is producing as much food as is currently needed – but that it is not being distributed.

However the press have reported the claim that without GM, all is lost. This is not true and it is not what the reports says. So why has this happened? Is it mis-briefing by those with an interest in GM? Is it the poverty of the imagination of the media?