Riots in Sweden, low turnouts in elections – are governments forsaking their responsibilities?
Fresh from his UK election landslide, Tony Blair set off to Gothenburg for the EU Summit and the meeting with George Bush, to be greeted by the now routine anti-capitalism riot. He was swift to dismiss the protesters as a fringe group of lawless vandals.
At one level, the scale and focus of these protests do differ dramatically from others in recent history. In western Europe, the great anti-nuclear campaigns of the early 1980s mobilised hundreds of thousands and arguably brought the end of the Cold War closer. In eastern Europe, the pro-democracy protests of the late 1980s engaged millions of ordinary citizens and demolished the Iron Curtain. They, like those in Serbia earlier this year who toppled Milosovic, were protesting in very real fear for their lives at the hands of the regime’s security forces.
The current wave of protests is full of confusion and contradiction – summed up during the London May Day demo by the scene of a handful smashing up John Lewis in Oxford Street – Britain’s largest workers’ co-operative – as a protest about global capitalism. More substantively, there’s an irony in the focal point for protests being meetings of governments trying to co-operate across national boundaries – whether the EU or the WTO. If the protest is about global corporations outgrowing the power of mere nation states to control them, then governmental coordination is part of the solution, not the problem.
And yet Blair is wrong if he really dismisses the issue so lightly. There is a real unease among citizens as a whole about forces over which they appear to have no control, even if few are yet ready to give up the consumer lifestyles which fuel the global trade system. So far this has not translated itself into a demand for action by government. On the contrary, recent low electoral turnouts in the UK and the US appear to indicate a sense that nothing much changes whatever party is in power.
Under those circumstances it’s easy for governments to stand back, simply encouraging companies to take action. In this issue, we do highlight the very considerable strides being made by the oil companies and motor manufacturers in particular. We also show how some companies are using their supply chain to have a much bigger impact beyond their owned and operated businesses.
However governments are wrong if they try to pass the buck – in a democracy, their job is to articulate the sometimes inchoate aspirations of the citizens and then legislate to set norms and standards, thereby creating a level playing field on which companies can get on and compete freely. Indeed somewhat buried in Labour’s election manifesto are two proposals that will eventually change the ground rules for corporate engagement.
First is the pledge to take forward the Company Law Review, especially broadening the duty of directors beyond today’s shareholders and widening reporting requirements. The second (and more local) is to implement the Social Investment Taskforce proposals about tax credits. Creating intermediary, community-based financial institutions, based on the US model, should transform business engagement in deprived neighbourhoods well beyond inevitably limited CCI budgets. But it won’t happen by accident; later in the issue, we explore how companies should respond to Labour’s second term.
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