Business as Unusual, continued

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Change by consumer conscience
But if regulation is not likely to happen, the conscience of ordinary people becomes of pivotal importance. And that’s where the NGOs come in, watching the activities of the big corporations all over the world to make them accountable to the public. Public accountability is an important criterion by which to judge presidents, prime ministers, bureaucrats and politicians, so why not CEOs of huge corporations? Business enterprises have anyway outgrown political institutions at the local, national and supranational level, and scrutiny by ordinary people and their representatives in NGOs are filling the vacuum. Just as it is in politics and the media, so it is with business: voters, readers and viewers, and now consumers, are one step ahead of most leaders.

If these are the people business depends upon, we in business should be changing to accommodate new demands for honesty, transparency and quality? Business leaders cannot stand by and do nothing while society groans and strains over issues that are of concern to almost everyone. Customers want to make ethical choices, and it makes sense for the best in business to help them do so — though most businesses fail to provide them with the basic information. The National Labor Committee in New York, a powerful group that supports workers rights as human rights, told me that in China it is now the law to emblazen the brand names of the company’s products on their factory walls and, I might add that today, China produces 36 percent of all manufactured goods for the USA, but the American Corporations will not print the addresses of their factories on their labels. Why? It will giveaway competitive advantage. Rubbish! These factories are all producing their competitors goods alongside their own. Consumers are starting to resist — as much as they are able — the inexorable progress of the global market. They are becoming vigilant and are starting to understand that everything has a consumer connection in this global economy.

Business As Unusual ~

I do not want to buy flowers from Columbia, because I know about the diseases caused by pesticides that women are enduring in the cut flower industry. I don’t want to buy from Total or Shell because of their practices in Nigeria or Burma. I just make my choices. I choose not to buy Disney’s products, clothes by Tommy Hilfiger, products from Walmart or Nike. The same goes for Gap. I am opposed to maximizing profit to satisfy investors, and I believe you should care for your employees, care for your suppliers, you should tell the truth by transparency of all your disclosures to your public and your customers. Only then can you conduct your business in a profitable way.

It has been these self-same consumers — vigilante consumers — political consumers challenging the transnationals, who have brought about what change there has been. Some have employed brilliant ‘sabotage’ techniques — fabulous guerrilla tactics like buying shares in a company and then turning up and hijacking the annual general meeting. Some just buy intelligently and demand information on the products from the CEOs or take part in consumer boycotts.

Boycotts are a paradoxical instrument to use. They threaten the jobs of ordinary people and they end the vital human connections that are needed to make change happen. But they are also very effective. Sales of Nike shoes dipped because the consumer knew they were being made in Thailand by young kids in sweatshops. Nike responded to consumer criticism by promising to let NGOs monitor labor conditions at all the factories that make its products. The company has also undertaken to improve air quality and offer education and business loans to workers although todate little, if anything, has happened.

Four out of ten consumers around the world responded in some way against actions by companies they thought were unethical during 1999, according to research by PricewaterhouseCoopers, BP Amoco and Bell Canada, in a survey of 22,000 people in 21 countries. The survey echoes similar research in the USA by PricewaterhouseCoopers and the Reputation Institute, which showed that a quarter of the 11,000 people they asked had boycotted a company’s products or urged others to do so. Ten years ago, the focus of public concern was on governments; now it’s business — from the environmental groups which are demanding change from the oil companies to the animal rights consumer assaults on L’Oreal or Gillette. Now they are being joined by the human rights lobby which is joining the ranks of the ethical investors, consumer boycotters and direct action specialists in spotting the so-called business agenda and therefore, in my view, rightly making business the target of protest. They are also providing other people — you and me — with information they believe ought to be publicly available when we choose what and where to buy.

Faced with consumer boycotts over Ogoniland, Shell recently published People Planet and Profits, glossy report outlining its aim to be “a leader in the economic, environmental and social aspects of everything we do”. This was from a company, remember, that wanted to ditch the Brent Spar drilling platform in the North Sea and invested heavily in Nigeria. If their report was as a vehicle for putting right their previous behavior, I saw no signs of it on my visit to Ogoniland in Nigeria in 1999.

There remain big questions about alleged human rights abuses by BP employees in Columbia. As many as 4,000 members of the U’wa tribe threatened to commit mass suicide if Occidental subsidiary Oxy forged ahead with its plans for oil exploration in their ancestral lands, also in Columbia. The U’wa believe drilling for oil will wound ‘Mother Earth,’ creating lethal consequences for the whole of humanity. They say they weren’t consulted before the project was mooted. But their protest ensured that whatever action Oxy took it would be in the harsh glare of the international spotlight, with vigilant, and vigilante, consumers ready to flex their financial muscle. The oil giants are learning that they can no longer hide behind consumer ignorance or indifference.

Many fear that the conversion of the likes of Nike and Shell to model global citizens is not much more than an empty public relations gesture. Nothing, for example, seems to be happening to improve the lives of the Ogoni people. But the rhetoric is there: “We found ourselves out of synch with society,” says Tom Delfgaauw, who heads Shell’s social accountability unit. “Consumers have a choice. They can vote with their wallets.”

These new NGOs and consumers have changed the world for companies. It is a world of immediate communication, of heightened scrutiny of all aspects of corporate behavior and of growing violence as internal conflict — both the cause and effect of human rights violations — replaces interstate wars. Transnational companies have shown themselves almost wholly unprepared for these changes although the globalization of the world economy has hugely increased their range and influence.

This movement towards ethical business is not happening because people like me say it’s a good idea. It is a groundswell — a growing realization that business has to play the social role that accords with its position in our society today. Customers are demanding it. The basis for this appropriate social role is developed when a company faces the question of just how responsible it is prepared to be with the undoubted power it wields — power over its employees, its suppliers, its shareholders, its customers and the public at large.

So business leaders have a choice. They can build a huge PR wall and talk down to customers, or they can listen and respond. Will they choose more smokescreens and inertia or will they listen and act? Consumers will be watching and waiting.

Seattle diary: Tuesday, Nov. 30, 1999: Yesterday thousands of people — kids, mums with buggies, the elderly, the middle-aged and the middle class, student, activists, church leaders, farmers, union members were all peacefully protesting. There were 300 children dressed as turtles, a reference to the WTO decision that it was illegal to discriminate against shrimps caught in nets that also drown 150,000 sea turtles. Now I am witnessing scenes I’ve never encountered in my life before and I hope never to see again. There is tear gas everywhere, rubber bullets fired point blank into the crowd of demonstrators, guns firing marble-sized plastic orbs filled with pepper spray designed to explode on impact, guns firing wooden dowels — like tinker toys without the hole. The police look as if they are storm troopers who had stepped from the set of “Star Wars,” with gas masks, full body armor and jackboots. None of them have visible badges or forms of identification. There are concussion grenades and even rumors of non-lethal nerve gas, armored vehicles, smashed windows, burning dumpsters, and blood.

The awful part of it is that, as far as I know, not one act of property desecration or violence has been perpetrated to incite the police violence. Without warning or provocation, they suddenly open fire on the peaceful protestors ringing the intersection of 6th Avenue and University Street, who have successfully prevented delegates from entering the Convention Center and the Paramount Theater, where the opening ceremonies are supposed to be held.

The police force protestors out and secure a lane for the ministers to be moved through. By this time, the ministerial meeting has already been delayed by several hours. As people retreat, coughing and crying and bleeding from the police armed offensive, rumors fly that the opening of the ministerial meeting has been called off.

Over the course of the next hour, the police line gradually bullies its way down the block to 6th Avenue and Pike Street and the entrance of the Sheraton Hotel, where the WTO’s Michael Moore is supposedly trapped, unable to get to the Paramount. The police battalion threaten a lock-down of at least 30 people, chained to a platform in the middle of the intersection. Hundreds of people sit down or mill around it, determined to protect the immobile resisters from the police assault. Vinegar is splashed on rags for the tear gas. Toothpaste for gas is daubed under the eyes. But the police, witnessing the preparations, resilience and fortitude of the crowd, march no further. The courage and determination of the protesters blows me away.

It is been an experience I will never forget, and it has re-radicalized me watching the tear gas and rubber bullets used against students, their professors, clergy, Tibetan monks, medical staff alike. Scrambling for safety as the pepper spray hit us, choking on the smell of cayenne pepper that sticks to everything, grabbing Paul Hawken, the environmental author, who is temporarily blinded, face burning, stumbling between other protestors, looking for water. The medics we have organised appear to be the first victims. They, too, are crippled. Everyone is screaming for water or vinegar. And everywhere there are shouts of “Shame on you! Shame on you!” directed at the police. I never anticipated it.

A native American tribe, the Oglala, once invited me to their reservation to see if there was any economic initiative we could come up with. The Pine Ridge Reservation in the Badlands of South Dakota is the site of the Wounded Knee standoff in the 1970s, a watershed in Native American activism, but they needed to survive in the world economy along with everyone else. The first thing I saw when I arrived there were sage bushes — sage bushes — everywhere. Sage oil is very good for the hair, so it made sense that if we could bring in some form of alternative technology, we would be able to extract the oil and then show the Oglala how to use it in hair care products. When I pitched the idea, they said they would have to “do a sweat” to ask permission of the plant nation. So we went through a couple of sweats, six Oglala and me, packed into a tent with one man pouring water on hot rocks to generate a suffocating steam — a terrifying experience because I’m so claustrophobic.

After all that, the verdict was no. The plant nation had rejected the idea, so the Oglala did too. After my initial astonishment, I realised this was more than plain respect. It was a veneration of the natural order so ingrained as to be alien to our own carpe diem culture. For about a nanosecond, my western business head spun, then wonder took over. We understand respect, as in “respect for the environment,” but we’ve lost our sense of true reverence.

I believe we can learn something from them. Because as long as we can put some idealism and reverence back on the global agenda, seeing and understanding that corporations and institutions have to be a force for positive change, then there is still a light at the end of the tunnel. There are so many aspects of life that can’t be reduce to an entry in a balance books, and our survival depends on remembering this.

Of course this will partly mean governments and consumers remembering it, but in the end it is about business itself living up to its responsibilities at the same time as they come under scrutiny. Public scrutiny is recession-proof. Companies will be judged as much on their principles as on their profitability, and, as some companies have already found to their cost, it is on the basis of principle that the brightest recruits will choose where to work. Inaction is not an option. The choice is between the exercise of corporate leadership in developing appropriate company policies, and being forced by public opinion to bring corporate practice into line with the values of society. The first would indicate that business recognises that its growing influence in the world economy carries with it growing responsibilities. The second would threaten not just individual corporate reputation, but it would also jeopardize the collective licence of transnational companies to operate in the 21st century because their moral standards failed to match their economic reach.


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