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You will immediately notice that this blog covers a wide range of themes - in fact, whatever takes my fancy or whatever I feel strongly about that is current or topical. Although themes may relate to business, corporate or organisational issues (i.e. the core talents of JCG), they also cover issues on which JCG also feels warranted to comment, such as social issues, my books, other peoples' books and so on. You need to know that comments are moderated - not to stifle disagreement - but rather to eliminate obnoxious or incendiary comments. If a reader wishes to pursue any specific theme in more detail, specifically in relation to corporate, business or organisational issues, or in relation to my books, then the reader is invited to send an off-line email with a request. A prompt response is promised. I hope you enjoy this blog - sometimes informed, sometimes amused and sometimes empassioned. Welcome and enjoy.
JJJ

14 April 2011


Boards and their non-adoption of human rights principles

Boards will not support human rights proposals for a few reasons:

1. Corporations are not agents for social change - they exist to deliver to their owners that which the owners want (leaving aside the distortions caused by board and management subjectivity, greed and stupidity).

2. What is ethical for one person is not ethical for another. What is oppression for one, is freedom to treat for another. This doesn't in any way justify or condone unethical practices, but it does emphasize the "greyness" of the discussion.

3. What is unethical in say, a Western society, may be totally acceptable in another country in which the corporation is active. Take treatment of women for example. Treating women equally is a given (at least in theory) in Western economies while women are treated as chattels in many second and third-world economies.

4. A large number of investors / shareholders earn their funds through questionable activities and from questionable sources.

5. If society wants corporations to support human rights principles, then, assuming one could define them in a way that would secure widespread agreement, you should legislate for such principles and practices so that all corporations are on a level playing field. In other words, government must define what companies can and can't do. This will be a challenge since first-world governments themselves deal with, support and fund second and third-world countries that commonly act in a manner that contravenes human rights.

6. Therefore, if you want human rights principles to prevail, then two initiatives are needed:
  • Have governments legislate for it (despite the caveats above) and demonstrate in their other dealings the human rights principles they expect of corporations;
  • Have shareholders withhold their investment in those companies who demonstrably do not exhibit positive human rights behaviours. If you hit the company in a manner it understands, i.e. financially, then it will alter its behaviour. Appealing to a board's altruistic motivations is like asking an alcoholic to refrain from drinking at a party at a brewery.
Expecting boards to behave above the lowest common standard is a futile expectation.

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