Global companies, governments and the pandemic

by with Comments Off on Global companies, governments and the pandemic
February 8, 2021

As the people of Myanmar came to terms with yet another military coup, Facebook had attracted 200,000 followers to a civil disobedience page. This was too much for the generals. Years ago, the decisive symbol of a military coup would be seizing the TV station.  In twenty first century Myanmar, it was when banning Facebook.

The company is now faced with a delicate balancing act. Placate the tyrants to get its service – on which 22 million people depend for their news and communication – re-established, or stand up for human rights and stay closed. Ironically, in 2017, it was via Facebook that hatred against the minority Rohingya population was incited at the beginning of that awful episode of ethnic cleansing.

For global companies at times of political upheaval, nothing is simple.

15 years ago, Tomorrow’s Company set out on what seemed at first an impossibly ambitious path: to bring together leaders of global companies in an inquiry that would explore the challenges and choices faced by the global company of tomorrow. We held dialogues in the UK, continental Europe and India and later, Saudi Arabia and the USA.  We tried, but failed, to get a Chinese company like Haier or Huawei involved.

We took encouragement from the testimony of the global companies and civil society organisations which participated. In spite of its many failures, the operation of global capitalism had lifted a billion people around the world out of poverty. Many global companies were beginning to describe their role as being a force for good in society. Our Inquiry team included Sir Mark Moody Stuart who had led Shell out of the depths of its Brent Spar crisis and been a pioneer of the UN Global Compact. We interviewed Nestle CEO Peter Brabeck Letmathe, who described his company’s tribulations over infant milk formula, and its later initiatives to contribute positively to development on issues like water supply and coffee growing. CEOs of Indian companies seemed especially visionary: I remember visiting development projects run by Dr Reddy’s Pharmaceuticals and marvelling at the scale of investment Infosys Technologies was making in primary education for the rural poor.

We interviewed Stephen Green, the ordained priest running global bank HSBC, with whom I remember discussing the role of ideals in the leadership of a global company.

These conversations all pointed in the same direction – the alignment between the long term needs of ordinary people around the world and the long-term purpose of global companies.

To us at the time, global companies seemed to be havens of internationalism. To their employees differing nationality mattered less than shared purpose. People of different backgrounds worked together and felt united by what the company stood for across the world. Their research and innovation were addressing human needs for cleaner air, safer cities, better nutrition, education and environmental solutions.

Fast forward to 2021. Huawei equipment is being removed from many national telephone networks. That company – which we admired from afar for being employee-owned – is now seen by many as an arm of the Chinese state. Meanwhile HSBC’s CEO has been accused of aiding and abetting one of the biggest crackdowns on democracy in the world after obeying an instruction from the Hong Kong police force to freeze the account of a human rights activist. Astra Zeneca is accused of failing to live up to its “contractual, societal and moral obligations” by the European Union after it had informed the EU that productivity problems would prevent it in meeting the originally anticipated schedule of deliveries.

So, what has changed? Everything and nothing. As we put the finishing touches to our optimistic report in 2007, the well was being poisoned by aggressive, extractive, ‘greed-is-good’ capitalists. The global financial crisis (GFC) left citizens poorer. They rightly blamed business.  The seeds were sown for disillusionment and the revival of nationalism.  The disillusionment – about government, business and experts – that followed has been charted yearly by the Edelman Trust Barometer

And yet….

We still badly need global companies to be part of the solution as Ong Boon Hwee and I argue in ‘Entrusted’.  Companies and governments have to find ways of being partners.

Astra Zeneca committed huge cost and effort to making a vaccine and volunteered to forgo profit long before it knew that it would be successful. A global company undertook great risk while promising to deny itself great reward.

The EU wants to promote responsibility in global companies. Yet it has chosen to attack a Europe-based global company which has tried to be a good citizen. What incentive does the board of Astra Zeneca to offer, in a future crisis, to be so philanthropic if these are the thanks it gets?

The World Health Organisation is powerfully urging governments to work together because none of us is safe until all of us are safe. Whatever our deep differences with China over the appalling imprisonment and indoctrination of the Uighurs, our common goals on climate and biodiversity will only be achieved if companies and governments work together on this agenda.

The UN Global Compact is still alive, and has the support of governments and 8000 companies around the world. It is explicitly supported by the Chinese government.

Out of the current COVID agonies must come a deeper level of collaboration between companies, governments and civil society organisations, working together to ensure that the poorest parts of the world will get their fair share of the vaccine.

Our 2007 vison may have been naïve. Yet we still need global companies to be a force for good. And to do this, they still have to engage with governments – even oppressive and unsympathetic ones.

Mark Goyder is the author, with Ong Boon Hwee of Entrusted – stewardship for responsible wealth creation (World Scientific 2020)

 

Comments are closed.