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Archive for the ‘workers’ Category

I can’t help but be on the side of the unions fighting for their rights in Wisconsin and elsewhere. I am pro-union. And I am pro-business. I see no contradiction in this. As a South African (now working in the US) I saw how trade unions helped people and how they led the fight against injustice. And I saw first-hand how good companies partner with trade unions and how they believe in trade unions as much as the unions themselves. I am always fascinated by so many US businesses being anti-unions. It need not be like this.

For the next few days I will tell you about my own experience in becoming a trade unionist in South Africa. I always say I am an ex-unions. But I am not. You can never be an ex-unionist. I am with my brothers and sisters fighting for their rights and protecting those workers who need protection against exploitation. We need them and business need them – sustainable businesses that is…

One note: We unionist in South Africa call each other Comrade. Nothing to do with communism. Just part of the legacy of fighting Apartheid and fighting injustices. So here we go – the first part of my story as a trade unionist. Maybe you’ll understand why I support the unions – I am biase because of my experience. They were my home and made me fit into the new South Africa. I am forever grateful to all my Comrades and what they gave to me.

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I wasn’t born to be an activist or a trade unionist in South Africa. Quite the opposite, really. I was born to be the stereotypical ‘good, racist Afrikaner’ in Apartheid South Africa. My family supported Apartheid and all of them worked for the Apartheid regime at some stage in their lives.

My dad was a Brigadier in the South African Prison Services, and one of his last assignments was to look after political prisoners at Pollsmoor prison during the last few years of Apartheid. Both my sisters worked at the prison services and married guys who worked at the prison services. And my brother worked for the prison services on Robben Island – where Nelson Mandela was jailed.

I grew up in a home that did everything the Apartheid government wanted us to do. We were part of the Dutch Reformed Church – the Apartheid government in prayer. We watched rugby – then the sport of the white Afrikaner. I went to school at Paarl Gymnasium – one of the best Apartheid schools in South Africa. I attended the University of Stellenbosch – the ‘brain trust’ of the Apartheid policies and politics. We read the Apartheid government approved newspapers and watched their TV. I benefited from the education they provided and the money they paid my dad. I was made for a life supporting and working for the Apartheid government.

Somewhere along the line things didn’t work out the way they planned. I became everything that Apartheid was against – an activist with a social conscience who loves being an ‘African’ on the global stage. Instead of being the man they wanted me to be, I became the man I wanted to be. It hasn’t always been easy. It hasn’t always been fun. But it always felt right. From Stellenbosch to Seattle, Mali to Monterrey, and Lusaka to London – no matter where the road took me, it always felt right, and it always felt as if I belonged.

That’s the beauty of life – you can be who and what you want to be no matter where you come from.

I got my big break – an interview with Gordon Young for a job as Developmental Economist / Researcher at the LRS (Labour Research Services). The LRS was the leading trade union support organization in South Africa. Well respected by overseas donors and at the center of policy making in the trade union movement. And it played a huge role in the anti-Apartheid movement during the struggle years.

Of course I knew nothing about all this when I got the call from Gordon Young. Hey, I applied for a job that was advertised in the wrong newspaper. And I was only a minor player in the anti-Apartheid movement at my university. How was I supposed to know who they were? I would have thought that it had something to do with taxes if someone mentioned the LRS to me.

But I managed to wing it at the interview. Gordon and myself did not hit it off straight away. I think that he thought I was a bit of a lightweight. He was right of course, but he also realized that I knew research methodology inside out. And that, combined with the lack of competition, got me through to the final round of interviews. With the LRS partner – NACTU – that I will be working with.

Again, I knew nothing of NACTU. Absolutely nothing. Thanks to my Apartheid education, I was never taught anything about trade unions in South Africa – not even at university. Never mind the smaller of the three trade union federations.

My initial research also let me down. I thought NACTU stood for the National Azanian Council of Trade Unions. It made sense. NACTU was closely aligned with the black consciousness movement and had close ties with organizations such as the Pan Africanist Congress of Azania (PAC) and Azanian People’s Organization (AZAPO) – two of the dominant black consciousness organizations in the fight against Apartheid. But I was wrong – although they were somewhat aligned with the PAC, NACTU stood for the National Council of Trade Unions. And their members had the freedom to choose who they wanted to support politically.

But I didn’t do that much research, thinking that I can wing it again as I did with Gordon. All I knew was that NACTU was a trade union federation and that the job would focus on supporting them with research.

Gordon told me I was to meet Cunningham in Johannesburg. If he liked me I would get the job as he would indirectly be my boss. Hey, they pay my salary – I just work for the LRS.

I started picturing Mr Cunningham. He sounded like a typical middle-aged white English guy – most likely from the ‘old country’ – England.

I got on the plane to Johannesburg from Cape Town to meet Mr Cunningham at the NACTU offices. Grabbed a taxi from the airport and off I went to Fox Street in the center of Jo’burg. I was shitting myself as I have only been to Jo’burg a few times, and the horror stories people told me sounded like something from Gotham City – muggings, car hijacking, stabbings etc. Not the place for a young white boy from a small town. But I made it to the NACTU offices in one piece.

As I entered the NACTU offices I immediately realized that I have never seen so many black people in one office. Everyone was black. It was a bit of a cultural shock – but a pleasant one. At last I found a place that looked like it represented South Africa. Anti-Apartheid slogans and pictures were posted all over the walls – clenched fists and all. I thought it was odd that a white middle-aged English guy would head up all of this, but this is South Africa and anything is possible.

So I sat around and waited for Mr Cunningham to come and call me for my interview. A tall, thin black guy in overalls walked past me and stopped. He looked back at me and said – ‘You must be Henk’. He came over and introduced himself. ‘Hi Comrade, I am Cunningham. Cunningham Ncgukana’. He wasn’t even middle-aged.

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It is election time here in the USA. To state the obvious – It’s an interesting time to be in the US. It’s even more interesting to watch how business behave during these election cycles. This election is especially interesting from that perspective as the two main parties are very divided on a range of social and economic issues. The emergence of the Tea Party and the right-wing in America begs the question – how do business lean during this election? And what does it tell us about their values?

For me this election raises the question of whether business have managed to really live their values through the political support they give to any specific party. The Republican Party is pitched by most as the business friendly party. The one that will look after the interest of business more than the Democratic Party. Of course this judgement is based on the value that the Republican Party will provide business compared to what the Democratic Party has to offer. Lower taxes, less regulations etc are all seen as Republican Party strengths – and all aimed at the value bottom line of business.

 But what about the values bottom line of business? How does their support of one specific party reflect on the values they claim to stand for? A few examples makes me question whether business takes their values as seriously when it comes to politics as their value bottom line.

Firstly, a number of companies are rightly proud of their ranking as good employers. And some of them are very proud that they are constantly ranked  by the Human Rights Campaign as Best Places to Work. The HRC lists the top businesses that support equality for lesbian, gay, bisexual and transgender employees. Now this is where I am slightly concerned that companies overlook these values when it comes to their political support. Do they take into consideration whether a specific political party of group (like the Tea Party) or a specific candidate support these values they uphold as important to their business? I dare say that not all of them do. Too many of the companies listed on the HRC Best Places to Work are also big supporters of candidates and political parties who do not believe in the equal rights for all their employees. I question whether employees are really the “greatest asset” of a company if that company is willing to sell the rights of their employees for a few dollars more to the bottom line.

Secondly, how about climate change? If your company believes that climate change is real and is a real threat to the long-term sustainability of your business – how can you justify supporting an individual or political group who do not believe that climate change is a threat that needs urgent attention?

This second point comes close to the value argument. The first point of equal rights for your employees is mostly a values argument but climate change is about both values and value. It affects your business sustainability and therefore the value you offer as a business. Maybe the world becomes grey because the business makes a decision between short-term value and long-term value. Tax breaks, subsidies, less regulations etc are all perceived as adding short-term value while climate change is something that will starting to hurt the business in 50 years or so. Like a frog being boiled…

I think that some of the support businesses give to Republican Party candidates and the party itself more out of legacy than anything else. They have always done so and will continue to do so out of habit. The truth is that both parties are pretty business friendly compared to most of the world. The value differences are more marginal than people would like us to believe. For example, businesses are cash flush at the moment, profits on Wall Street is up etc – all under Democrat rule. But like anyone who has a long-standing habit or addiction, businesses will support the Republican Party and candidates “because that’s what they’ve always done”. Not a compelling reason but still a reason.

For some businesses it is a clear-cut reason. If they believe that clean energy or a drive for more renewable and alternative energies will hurt their business they will fight against it. Guess who fights renewable energy more than the other when it comes to political parties? But what about that company who believes that the environment is key to who they are as a company? If you are in the outdoor industry then mountains mean a lot to you. People use your products to go and enjoy nature. So how would you feel if someone mines away that mountain top? Not so good. And how about being in an alliance with a company and/or party who supports mining that mountain top? Be careful who you form alliances with even when you don’t mean to be in a formal alliance. You are who you support and who your candidate supports. You can’t shout for greater action on climate change one day and then support a party or candidate who stands for the opposite. Stick with your values or stick with your value – if you believe they are separate. But please don’t claim to have CSR or sustainability in your DNA and then take actions which completely contradicts your statement.

There are many more of these examples. Companies in the construction industry – are you supporting the party who are providing cash to rebuild America or are you supporting those who say that they should never have spent this money in the first place? Retailers – are you supporting those who want to provide continuous tax breaks for the middle class or those who insist that the richest get the biggest cut or no one gets a cut?

Look in the mirror and ask yourself whether you are willing to trade your values in for a perceived value. History is littered with the easy way out – take the money and forget about the rest.

I don’t have a problem with that. Each company will decide what is best for them. Just do me a favor – don’t sell me CSR snake oil stories of “it’s in my DNA”. Embrace who you are and live it. Be true to yourself no matter what that truth might be.

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Don’t know if you’ve noticed the bit of oil in the Mexican Gulf. Bit of an issue for BP and the oil industry in general. I think enough is being said about the oil spill and the responsibility of companies by the experts – you really don’t need me to add another opinion to this. However, it does remind me that almost every company has an oil spill waiting to happen.

Every company has a big issue they face. Some have more than one. For the oil industry it is price, human rights, sourcing location and environmental impact. For the pharmaceutical industry it is price, intellectual property and access. For food companies – sourcing practices and obesity. Car manufacturers face safety issues. Clothing and show companies know that people are always looking at the working conditions in those far-flung places where their goods are made. Banks… Where do I start….

The point is that all companies will face these issues. It is driven by multiple factors – what is material to your company and what activists (NGO types or investors) highlight and where people want change in behaviour. What’s your biggest issue? Are you even aware of what it is?

There are other big issues that are less well-known within the broader public or even amongst activists. The skeletons in your cupboard. Most companies have these. Those issues you know you where are vulnerable but no one is looking at it at the moment. For instance, people focus on the working conditions in clothing and footwear. We are all aware of it and all responsible companies are trying to do something about it. But tell me, do you use leather? Few people know the way leather gets from cow to shoe. The tanning and dyeing are not something most people think about too much. It’s leather – how bad can it be? I’m lucky that I worked with the footwear unions and business in South Africa for a while. It gave me a bit of first-hand experience. Just go and have a look at how the huge quantities of leather needed for your shoes and clothes are tanned and then dyed. Not a pretty sight… But it’s out there in the middle of nowhere and no one of note campaigning on this. And maybe it isn’t even such a huge issue when looking at the broader impact of companies. But it’s out there – as visible as an oil spill for anyone looking.

It does not have to be the biggest impact – it just needs to be the most visible impact. You think the oil spill in the Mexican Gulf is the worst oil spill ever? Think again. It’s just the worst oil spill in the US and developed world. Oil spills happen daily – we just don’t see it every day because we can’t or don’t want to visit some of the places where our oil is secured from.

So the question for business to ask themselves is how far am I from a disaster hitting me? What is the disaster waiting to happen and will anyone notice? And what can I do now that makes sense. Companies can’t fight every potential disaster – No more than what the Average Joe can prevent every single thing that might go wrong in their day. Things happen no matter how much we try to prevent it. We plan and hope for the best. It is part of living. If we didn’t do that we will all stay at home and eat apples – too scared of being in a car crash, hit by a natural disaster or eat crap and die from obesity. Life is assessing the risks and doing what we think is best. Most of the time it pays off and sometimes it doesn’t. That’s life. But we better be prepared to face life with careful planning and open eyes.

It’s not that companies aren’t trying to do their best to prevent disasters. BP and the companies they worked with did not want this to happen. It just happened. Unplanned.

That’s the challenge – unplanned. What can we do to prevent the disaster from happening? Are you ready? Or ready enough? The reality is that we can’t live a business life without a disaster but the challenge back is that many businesses just do not prepare well enough to deal with disasters. Risk is one thing. Cost and risk combined generally brings us that little bit closer to disasters.

Let’s look at the oil disaster again. Some are arguing that the lack of a safeguard device resulted in this oil spill becoming the disaster it is today. The WSJ (and many others) reported that the Leaking Oil Well Lacked (a) Safeguard Device. I won’t go into the details of what this device does as I am no oil expert, but the argument goes that Brazil and Norway requires oil companies to have this device in place as it chokes off the oil flow in case of an emergency. The US doesn’t require this – and most countries don’t. The oil industry lobbied hard to not have this requirement. The main reason? It adds $500,000 to cost.

It’s easy to look at it now and say that this decision by the US government (under President Bush) and the oil industry was a major mistake. However, responsible companies do not wait to be regulated into best practices – they lead. Without naming the company, I worked with a US company who adopted best practices as required in Australia because they believed it was the best thing to do for the company – and the most sustainable. Responsible companies have to manage the costs that comes with taking in best practices but one great disaster substantially undermines the argument of “too much costs”. How much do you think one single big disaster will cost your company? It’s always difficult to judge the effectiveness and cost argument when nothing goes wrong when you prepared for it though.

But I want to take this one step further – are you truly global?

We talk about those large companies as global because they work across the globe. But the truth is that few companies really are global in practice. They might source from or sell to the globe but they don’t always have the required global systems in place. A responsible company will ensure that their responsibility practices and policies are global. You take what is best in the market and make that global. Not only for preventing oil spills but also when it comes to hiring practices, recognizing human rights, transparency, environmental impact etc. Responsible companies do not go to the “what is legally required” level – they go to “what is required” level. Required by investors, stakeholders, employees and society as a whole. BP should ask themselves where the valve falls. Pharmaceuticals should ask where access or intellectual property rights fall. Food companies should ask where obesity, advertising to children, nutritional information etc falls. Clothing and footwear manufacturers should ask where working conditions, human rights and dyeing falls. Every company should have a heart-to-heart and ask themselves where their major potential disaster(s) fall.

…And companies are still surprised why consumers and activists are tired of green washing? It’s because they know that you are one wrong risk assessment away from a disaster – in the open or in the closet.

What is your oil spill waiting to happen? And what are you doing about it?

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Nice to see that profits bounced back in 2009 for the Fortune 500. According to Fortune, “for 2009, the Fortune 500 lifted earnings 335%, to $391 billion, a $301 billion jump that’s the second largest in the list’s 56-year history”. Nice. These last few years have been a tough time for most companies so this financial turnaround is good news for investors and for these businesses. Good news for everyone, right?

Maybe not for everyone…

Fortune also said that “in 2009, the Fortune 500 shed 821,000 jobs, the biggest loss in its history”. Earnings up but jobs down. How’s that? Well, earnings might be up but actual revenue went down by 8.7%. What happened was that companies panicked when they saw the economy stuttering. Fearing the onset of a depression, companies raced to lower expenses even faster. “Producers practically panicked,” says Mark Zandi, chief economist at Moody’s Analytics. “They cut costs incredibly aggressively.” And by cost we mean that little line item accounting for two-thirds of their costs: labor…

So companies protected their profits by cutting labor. They cut costs not to keep the company afloat but to ensure profits remain high. One can understand that companies have to cut costs when the business is threatened. If they don’t then all jobs might be lost and the business pushed over the edge – shutting down or getting sold to the highest bidder. However, it is one thing to cut costs to make the company more competitive or to save a company but another thing to cut costs to ensure higher profits when everyone is struggling.

Is this really the way a responsible company should act?

So often we hear business leaders talk about their greatest asset being the people who work for them. They go on about how these people are the heart and soul of the company and that the company won’t be who it is today if it wasn’t for every single person working so hard. Loyalty by workers and the effort they put in to make the company succesful forms part of the bragging rights for business leaders – they take it to conferences, annual meeting, the media, their competitors etc. And they hunt hard to make the “Best Place To Work” list each year.

In addition, almost every CSR survey I look at shows how you treat your employees as the most important thing a responsible company can do. So, not only is it something that companies brag about but it is also something that the public view as the most important thing a company can do.

Can companies who ran up record profits therefore really be seen as responsible corporate citizens if they did this on the back of laying off workers during a tough time? Should the responsible company not stick with their workers during tough times and rather use the good times to gear themselves to be even more competitive? If business leaders truly believe that their employees are the most important asset of their business, should they not show greater loyalty to those workers during tough times?

What would a responsible company do during tough economic times? Would a responsible company push hard for higher profits no matter what or would a responsible company protect both their employees and the profitability of the company? Make not mistake, this is not an either or question. The Fortune 500 companies had more than solid earning – record increases. For many of these companies the choice was remaining profitable and protecting employees or drive profitability to new heights by laying off employees.

Many companies made the choice to drive earnings on the back of job losses. There is nothing wrong with that. It is a business model followed by many and one that holds the investor as the ultimate stakeholder. But, if this was the route you chose, please do not talk about your employees as your greatest asset again. Greatest assets are never left behind in tough times. Greatest assets are protected and respected at all times. It’s during the tough times that we can judge whether it was words or actions.

Or maybe you just shouldn’t panick the next time we have an economic downturn. Take a deep breath, keep calm and remain level-headed. This will pass and you should focus on how to turn a challenge into an opportunity instead of a panick picnic. Huddle together with your greatest assets and make them part of the solution. Heck, you might actually be able to find a few new assets as your competitors panick and drop their best assets as they run for cover.

It’s not about people or profits. You can have both and respect both. And be committed to both people and profits. Treat both as assets and be true to your word. That’s how you protect your people so they can help protect your profits – now and for the future.

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