Exxon not paying US federal taxes and kids smashing their new iPad. That made for a sad day of reading. But thank you Intel for saving my day with some real leadership in stakeholder engagement.
It took me a while to try and figure out a snappy headline for this one but I think this one works best – plain and simple… Exxon paid no US federal tax in 2009. I must admit that I am a bit shocked by this. Is it even possible for a very profitable US company to get away with not paying any federal tax in the US? Well, the original source is from Forbes so I take it as true. I’m not going to go into details on their anti-climate change position and funding of dubious organizations and positions. Neither will I discuss how this non-tax paying bit makes their pro-carbon tax look a bit like playing politics. And I’m not going to mention how this might be a slap in the face of the US when taking into consideration the subsidies they received. Or that they really should not complain about the tax rate in the US anymore. Or maybe they are doing that on behalf of the lobbyist they hire…
However, I am interested in how this reflects on their broader responsibility as a supposedly proud American company. Look at this line from the Forbes report:
Exxon tries to limit the tax pain with the help of 20 wholly owned subsidiaries domiciled in the Bahamas, Bermuda and the Cayman Islands that (legally) shelter the cash flow from operations in the likes of Angola, Azerbaijan and Abu Dhabi. No wonder that of $15 billion in income taxes last year, Exxon paid none of it to Uncle Sam, and has tens of billions in earnings permanently reinvested overseas.
So Exxon (or any other company for that matter) reduces their federal taxes by hunting for the best shelters hidden on nice little island. Can these companies ever be judged as responsible companies if they go out of their way to not to pay taxes in their country of origin or where their headquarters might be? It seems as if those who have the means to get away with not paying taxes tend to get away with it and those small businesses who drive so much economic activities are more inclined to own up and pay up.
It’s when I read headlines like these that I get a bit despondent and ask whether there is any line out there we can agree on or is it just a free for all? Fight, argue, lobby – it’s all fine. But let’s agree that if you are going to fight, argue and lobby then you should at least pay your taxes and not run from your responsibilities. Does your home country and your responsibility towards your fellow countrymen mean so little to you that you will do everything to run and hide the money?
It’s just a bit too much, isn’t it?
Continuing on this sad reflection on society – let’s talk about American teenagers today…
It seems as if everyone under the age of 21 waited in line to get hold of the latest cool Apple product – the iPad. (Full disclosure, I want one…) It’s the new must-have Apple product. The iPad brings us so close to having our device big enough to use and small enough to carry around easily. A few Apple tweaks and we should be there in a few years or months. Anyway…
A bunch of teenagers just managed to capture everything that is wrong with consumption today. They bought an iPad and then smashed it to pieces. Why? “It was just something to do.”
Again I am dumbfounded. They bought something that costs more than most people in this world make in a year and then just smashed it to pieces? So that they could put it on YouTube and have a few laughs? No consideration to the impact of making the product.
We live in a society that consumes just for the sake of consuming. And we get so bored of consuming that we purchase just to destroy. Out of boredom.
Companies can create products that can help society. But kids (or grownups) with too much money will prove that even the best products can be wasted by people who are a waste to society.
I couldn’t end with two stories on groups who just don’t get it – so here is a feel good story to make up for it.
Intel agreed to a shareholder resolution requesting the creation of a Board Committee on Sustainability. Harrington Investment submitted the same proposal last year but it got shot down. They tried again this year and Intel agreed with the proposal. The easy part will be to applaud both Intel for establishing the Board Committee and Harrington Investment for sticking to it and get the job done. That’s the obvious bit of good news. But there is more.
What I see as the real leadership is Intel showing that listening to stakeholders is something they actually believe in. Last year they didn’t agree but they sat down and considered it again. Instead of having the typical knee-jerk reaction that most companies have to activist shareholders, Intel listened and considered. And they supported the proposal because it was the right thing to do for them and for the shareholders and stakeholders. Big thumbs up to Intel for bringing a real maturity to shareholder proposals.