Without accountability, corporations will continue to exploit the system and us all.
Caroline, a self-employed mother of two who sells sweets at a stall in Nakambala Market, Zambia, earns ZK20,000 (about US$4) per day. She also pays a higher proportion of taxes than Zambia Sugar, a subsidiary of Associated British Foods, a company which enjoys an annual revenue of ZK1 trillion (US$200 million). Not only does Caroline pay a higher proportion of taxes than the massive corporation, she pays more tax than the corporation in total!
This is a striking example of ‘Corporate power’, a term defined by AWID and Solidarity Center as the control and appropriation of natural resources, labour, information and finance by an alliance of powerful corporations and global elites, often in collusion with government, fundamentalist and fascist actors. It is important to note that corporate power is rooted in a history of colonialism and imperialism.
For example, conservative estimates report that the majority of the $50 billion lost annually in Africa is through the activities of large commercial companies like Associated British Foods thereby sustaining neo-colonial exploitation. It is important to note that corporations like the East India company which became “one of London’s most powerful financial institutions” played an important role in consolidating power and profit in the early times of colonization and imperialism.
Private Sector vs Human Rights: Not so simple?
I recently attended the Commonwealth People’s Forum held in London from 16 -19 April 2018 and joined panelists to unpack why the private sector remains so challenged in the area of upholding human rights. For me, the answer is simple. The basic aim of all business is to maximise profits and often at all costs. Contrary to what some private sector actors want us to believe, it is not for social transformation neither is it to advance social justice. In fact when corporations purport to pursue a transformative agenda, their proposals often lie in market-based solutions that feedback and reinforce their profit-driven structures.
Dominant schools of thought like Adam Smith’s “invisible hand” have been convincing us that free market is inherently good for the society and common good. These further advance that without state interferences societies will prosper through a ‘trickle-down’ effect, and economic growth will eventually be good for all members of the society. It follows through that with this logic of profit maximisation, human rights abuse and environmental destruction can actually make business sense.
It can be profitable for the private sector to promote ‘trickle-down feminism’ which lauds more female CEOs but continues to exploit and push millions of women to precarious working conditions and a reliance on women’s unpaid care work. As aptly said by Debbie Douglas from the Ontario Council of Agencies Serving Immigrants (OCASI):
“We can no longer talk about shattering the glass ceiling without talking about those who are sweeping the broken glasses.”
@shalinikonanur sharing a comment by her colleague debbie @salco "we can talk about shattering the glass ceiling, but we have to talk about who are sweeping those broken glasses?" challenging the #G7 to truly see who's vulnerable domestically & globally #W7Canada @kramdas @AWID pic.twitter.com/1rs0SpLYHp— Tenzin Dolker cyclone (@T_Dolker) 25 de abril de 2018
It makes business sense to rely on lower environmental standards in the Global South and place life threatening polluting industries there because it is cheaper and unleash private security to silence any dissent from communities who challenge this economic blueprint. It can be more profitable by relying on cheap migrant labour without paying social security and health insurance. And, it can certainly be more profitable to send an army of lobbyists and litigants to change legislation in favour of business interests at the expense of public interest for example with Flint Water crisis.
Oppression, Intersectionality, and Corporate Domination
These are just but a few examples of overwhelming evidence on the injustices inflicted by the current economic system. As demonstrated by the gender and race dynamics of Caroline from Zambia and the water crisis in Flint, Michigan, corporate power depends on, and reinforces, long-standing and interlocking systems of domination based on colonial histories, gender, class, race, caste and ethnicity.
From exploitative working conditions to corporate land-grabbing, forced displacement and environmental pollution which often hit women and historically oppressed groups the hardest. As such, we have to begin to look beyond private sector as not only a place of work and whether or not it is inclusive for its minority employees but what is the broader impact of corporation activities in the broader society.
It is only then that we can truly begin to interrogate the glaring contradictions of awarding Monsanto as the best place for LBGTQI people to work and in this ignoring the horrible human rights record it has from its global monopoly over food and selling toxic chemicals to destroying local farmers and the environment.
Back the Basics: Who are corporations accountable to?
Due to their consolidating power, private sector actors are increasingly infiltrating governance mechanisms. The current economic model favours huge multinational corporations led predominantly by a few middle aged white men who through their wealth have unprecedented political influence and access to spaces that should be wholly independent and serve public interest. The lack of a comprehensive legally binding international framework to monitor, review and hold to account and redress the activities of corporations has allowed corporate impunity to thrive.
The UN Guiding Principles on Business and Human Rights is a global framework to address corporate human rights violations, but its guidelines are voluntary. The Binding Treaty could become an essential tool to address corporate power through the regulation of transnational corporations (TNCs) and other business enterprises (OBEs), ending corporate impunity and ensuring access to justice for affected communities. This initiative is currently led by Ecuador in the UN to develop a set of binding obligations and enforcement mechanisms to hold corporate entities accountable for human rights abuses.
This historic opportunity to bring to an end decades of human rights abuse and corporate impunity must be supported by Commonwealth States. Civil society must join the ongoing intensive mobilization to call for a Binding Treaty to amplify citizens realities and as well as advance visions of just economies. It is through such processes that social justice movements can continue to challenge the core assumptions of the current economic model and centre people’s basic needs and dignity, environmental wellbeing, and solidarity and care for our communities.