IT'S GOOD BUSINESS
by Robert Stewart, C.A., C.M.C.
"Just as businesses participate in building a culture of violence, businesses must be involved in building a Culture of Peace."
Under a National Culture of Peace Program, Canadian corporations (and governments) should be expected to follow the same values and ethics that we expect of our citizens. The Golden Rule captures it succinctly: 'Do unto others as you would have done unto you'. That these values would contribute greatly to peacebuilding at home and abroad is obvious. Much homework has already been done identifying appropriate conduct (1). It is time to monitor and hold our Canadian corporations (and governments) accountable. To ensure organizations walk the talk, we must have a 'Gap Reduction Plan', proper training and coaching.
The allegations appear daily: "Industry giants such as Nike, Disney, Gund, Mattel, Fisher-Price, Reebok, Gap charged repeatedly with human rights and labour law violations in their contracted sweatshops"; "Talisman Energy's work in the Sudan has assisted genocide and disgraced our nation"; "a market stranglehold by Nestles and General Foods had been crippling coffee and tea sales in Tanzania"; "Ford and General Motors aided the Third Reich"; "tobacco companies purposely addict young smokers"; "Nortel closes unionized plants, shifting production to non-union facilities including two of the most notoriously low-wage, politically repressive, and environmentally unregulated countries in the world: China and Mexico"; "Canadian based Placer Dome is infamous for an environmental disaster at the Marcopper Mine in the Philippines cited as negligence in a U.N. report"; "the Canadian Red Cross allows tainted blood to be used"; "the 1973 military take-over of Chile was engineered by the U.S. government in close cooperation with three of the major multinational corporations with investments in that country: ITT and mining giants Anaconda and Kennecott"; "Canadian company Ranger Oil recruited Executive Outcomes, a private army for hire, to drive the rebel Unita army out of Soyo, a centre of the oil industry in Angola"; "British American Tobacco involved in smuggling"; "De Beers implicated in child labour horrors and civil wars"; "arms manufacturers profit from tools of death". The list goes on (2). Implicated Canadian companies tarnish the image of the many ethical companies (3).
Corporate Crime, a 1976 study, reported that 60 percent of large corporations in the U.S. had been charged with at least one form of criminal behaviour. When men (they're almost exclusively men) walk through the doors of these corporations, or any large organization, they are transformed into corporate citizens producing wrong, immoral and irresponsible decisions, even though the personal morality of the people as individuals may be above reproach. A group acts under a different morality than individuals. Similar to a mob mentality - responsibility is shared among many, and owned by no one.
There is no crime beyond the grasp of greed. Competition breeds contempt, for others and the law. There is no area of responsibility untouched: environmental, social, political - even the sanctity of human life. It seems that it is easier to achieve one's corporate monetary goals through violence. The public has allowed companies (and governments) to get away with not honouring their relationship responsibilities. Let's face it - voluntary Codes of Ethics just won't 'cut it'. In the world of forensic auditing, they say 20 percent of the people are totally honest, 20 percent are quite dishonest, and 60 percent are honest depending upon the situation. While voluntary Codes of Ethics may be fine for the honest 20 percent, and a good starting point for the others, we must go beyond that.
The Corporate Peace Manifesto
The Manifesto 2000 (4) provides a Code of Ethics consistent with what is expected personally. I urge all companies (and governments) to sign it organizationally as part of their contribution to the International Year for a Culture of Peace. By doing so, companies pledge in their daily operations to respect all life, reject violence, share with others, listen to understand, preserve the planet, and rediscover solidarity by contributing to the positive development of their 'community' and the people in it. At the time of signing, companies should be educated in the full meaning of this pledge and internalize this commitment through action.
Companies (and governments) that make this pledge should be acknowledged. Those that do not should be treated like the scourge they are. It is time to take sides: are you for peace or violence? We expect this of our citizens, why should we not expect this of our corporate community?
Social Accountability 8000
In 1997, the US-based Council on Economic Priorities formed an Accreditation Agency to assist in the creation of auditable standards for the protection of workers' rights around the world. Modelled on the well-known ISO9000 and ISO14000 series for quality and environmental standards, SA8000 was released in December 1997 (5). Now there is no excuse for major corporations not to include an audit report on how they measure up to their environmental, social, political and human responsibilities under Manifesto 2000.
Governments and regulatory bodies can ask for such auditable standards. Investors can vote with their money. The bad news is: rates of returns may initially decline when corporations are forced to stop lying, cheating and stealing. The good news is: there will be a peace dividend if we stick with the plan. In an age of instant gratification this may be a tough sell, so we must teach our children to be patient, ethical investors. This is not a quick fix. It is going to take time.
Why is this Good for Business?
This levels the playing field. It simply defines the rules of the game (and changes the game you play). It keeps the players honest. If you do what is right - even if it costs you in the short run - it will pay off in the long run.
Unethical companies, like unethical people, pay a price. For example, when employees feel negative toward their company, they often look for ways to 'even things out' - like calling in sick when they aren't sick at all, padding expense accounts, taking office supplies home, etc. One top manager from a major retail chain said he could reduce prices to customers 20 percent if he could stop employee theft. Concerned customers and citizens could exact a much greater toll. Building a safe and caring work environment will save money and hardship.
What Can We Do?
As owners of businesses (including shareholders), we can take active steps to introduce a Company Ethics Program. Every manager and employee can play an important role in helping their organization create the kind of positive environment that fosters sound ethical decision-making and behaviour. As customers we can vote with our dollars -if you do not want your children, grandchildren or someone else you love to be victims of violence, simply do not buy from companies who continue to build a culture of violence. The media can report on the heroes and villains (after they choose which side they are on). Voters can motivate their community and government leaders to take action to discourage corporate violence. Schools can teach about the importance of ethics and integrity. Governments can tax violent goods and services and put the money into prevention.
If the public insists that companies (and governments) honour their relationship responsibilities, they will, and a Culture of Peace shall be built. It will probably take five to ten years of concentrated effort to turn around a negative situation similar to the one in Canada's corporate world. It starts with a clear purpose and is maintained with patience. So the principles of ethical power really do apply to organizations as well as to each of us individually.
1. reference sources for values and codes of ethics in corporations and government can be found at http://www.peace.ca/codeofethics.htm
2. a good web site for further examples is Corporate Watch http://www.corpwatch.org/ . Picture credits courtesy of Corporate Watch.
3. for an excellent Canadian analysis, see 'The Myth of the Good Corporate Citizen' by Murray Dobbin
The Corporation: The Pathological Pursuit of Profit and Power by Joel Balkan
Commerce with Conscience
Department of Foreign Affairs and International Trade discussion paper on Corporate Social Responsibility http://www.dfait-maeci.gc.ca/tna-nac/Corporate_discussion-e.asp
Response to the DFAIT discussion paper on Corporate Social Responsibility by Craig Forcese
Buy in or sell out? Understanding business-NGO partnerships by World Vision, Summer 2000 http://www.worldvision.org.uk/world_issues/global_economic/business-NGO.html
Robert Stewart is a Chartered Accountant in public practice, and Director of the Canadian Centres for Teaching Peace. He is also the only business person on the national committee for the International Year for the Culture of Peace.
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