Credibility and the Corporate Sector

By Arvind Saxena

Not only will we have to repent for the sins of bad people, we will also have to repent for the appalling silence of good people. — Martin Luther King Jr.

A friend, who is a top businessman and corporate leader in his country, recently sent me four questions. These, he said, had been bothering him for many years and being a conscientious person, he was greatly troubled by the disrepute some corporate giants were bringing to his community.

His questions were simple enough:

1.Why do common citizens resent successful businesses so much,?
2. Do you see this as a problem for advancement of the role of the private sector as a driver of growth?
3. Who do you think is responsible for this increasingly negative perception?
4. How can this trust deficit be bridged?

Let us start with two incontrovertible facts:

1. All businessmen and corporate entities do not generate resentment among the people, and

2. The private sector is an indispensable partner in the economic development of a nation.

Even as profit making as an objective of business is perfectly fine, the question is how much and how it is shared? Sharing cannot be just with the shareholders and the government; it also has to be with the employees and the community at large. There is no problem if the profits are ploughed back into expanding the business or investing in the domestic economy for modernising industry and creating more jobs. The workers’ share is not just wages, but also investment in better housing for them, skill upgradation, health benefits and education for their children. A business doing well must provide a sense of security to its employees, who should be viewed as partners and an integral part of the business. Wholesome organisations with a vision to partner in nation building must build structures of social security, for during and after the working lives of their employees. Contract employment is an obvious anathema to such a viewpoint. Keeping employees under stress of uncertainty might sound like good policy to extract maximum work and enforce discipline but this approach is, without exception, counterproductive. Leave alone human beings, it does not work even for beasts of burden. Rewards and punishment might work for a dog but eventually even the dog will bite back if we keep him hungry and anxious, under stress of uncertainty. Employees carry impressions about their employers into the community and the resentment spreads.

Inequality and concentration of wealth with a handful of people is perhaps the most important cause for popular resentment against the business community. If an enterprise is making huge profits, there is something wrong going on. Either the cost of raw material and national resources is being suppressed in connivance with the representatives of the people, fair compensation is being denied to employees and intermediaries, the end consumer is being overcharged, or to top it all the accounts are being fudged.

Something sinister like money laundering, flight of capital or round tripping of money takes place under the cover of laws written to benefit the criminals. Every regulatory authority, enforcement agency, audit company, policy formulator and head of institutional investors has to be held to account. If they can’t do their jobs, they should go. If someone is shielding them then the bureaucracy and the judiciary have to use all their constitutional powers to arrest and throw such interlopers into jail, howsoever mighty they be. That the mighty represent the people becomes meaningless when they are found conniving with corrupt business houses.

It is true that it is difficult for the common man to relate to figures running into Millions and Billions of currency units and those who can comprehend the magnitude are either insiders, or have been co-opted into the corporate shenanigans. The top honchos successfully safeguard their turfs by influencing elected leaders and buying out the opinion makers. Thus, they control policy making and perception management. The co-opted cannot see beyond their narrow personal interests and choose to lead a make-believe life of saturation level entertainment and conspicuous consumption inside gated communities. That leaves the bulk of the employees and perhaps eighty percent of the population who, as mentioned above, are not equipped to understand the scale of the con games. The windfall profits and illegally accumulated wealth, an outcome of monopolization and cronyism, is shared with the elected representatives who use it to silence the eighty percent with free food and other subsidies.

A poor, hungry, sick and uneducated people cannot sense any distress or discomfort other than their hunger and need for survival. A leadership which keeps them provided with subsistence is viewed as God’s own gift – the Messiah who keeps them fed and alive. Those who are not co-opted and understand the game and the scale of corruption, turn out to be a minority whose numerical clout is insignificant and thus their opinion dispensable. The vehicles of communication available to these informed people have been taken over by big money and the channels choked of real news and information. The media is reduced to tools of propaganda and perception management. Social media, which is on sale to the highest bidder, is perhaps the single biggest weapon used to keep people misinformed. While truth does have this nasty strength of coming out with time, it becomes meaningless for a people beholden to big money and its cohorts for their ‘miserable’ survival.

So, what can be done to correct this false and potentially dystopic economic model, propagated so vigorously by some of the most celebrated universities, business schools and think tanks, not to speak of the ‘wise economists’, who are brainwashed into believing that there can be no development without letting the corporates get unhindered access to the nation’s wealth. This mindset must change. Utopian? I am sure not completely.

The resentment among the people will spread, slower in poor countries and faster in countries with better education and standards of living, and people will challenge the present economic model based on corruption, opacity, and falsehoods. Nature and the environment will step in at some stage to raise red flags and destroy projects and institutions of greed. Before the masses rise and the rich are hauled up before the people’s courts, they must act. The actions are simple and will not make them or their progeny poor. All that needs to be focussed on are simple laws of nature.

Nature abhors disequilibrium. Imbalances in distribution of wealth must be tackled on a war footing. The haves cannot forever exploit the working people, who dirty their hands. They have to be given their legitimate share of the returns. Public money has to be held in trust – and treated as such. It has been entrusted to the large businesses for maximizing returns and bringing development, not for the promoters but for the people – the educated and well fed as well as the illiterate and hungry masses. They own the nation and its resources as equals. Read More… Become a Subscriber

Mauritius Times ePaper Friday 17 February 2023