The Corporate Society?
/This afternoon I was at the Roundhouse in Camden for Business in the Community's "Communities Summit", courtesy of the Big Society Network, listening to Prince Charles and the Prime Minister issue a call-to-arms for British business to step up and take responsibility for the challenges facing the country.
This felt like an important moment in the somewhat chequered history of the "Big Society" policy agenda, and also of the up-and-coming social enterprise movement. Essentially this was David Cameron's most decisive attempt yet to reboot the Big Society as something more tangible, turning it from a rather elusive and abstract policy of community involvement into a clarion call for business to support grassroots action in communities around Britain.
It was useful to hear this new direction, primarily because the greater clarity it brings should finally make it possible for people to take action in support of the "Big Society" project - which, as I have said before, has been hard for many of us to get behind previously.
But this clarity is also helpful because it names something which has often gone unsaid in the Big Society rhetoric, which is that if private funders and volunteers are to play a leading role in delivering our public institutions and improving communities, this will naturally mean private businesses - who are capable of mobilising far more money and manpower than any other sector of society - having a much greater say over the running of our society.
Where I found myself in tune with this thinking was on the importance of businesses stepping up and taking responsibility for the impact they have on society. As David Cameron indicated today, the Government can do a lot to tackle the obesity crisis, but all its public health campaigns and NHS services will fail if corporate interest continues to make it harder to eat healthily than to eat unhealthily. All the nudges the Government can muster will still pale in comparison to the huge efforts spent by consumer brands to push people back the other way.
Prince Charles, who I've always rather liked, bless him, also spoke very passionately about the opportunities that businesses have to make a positive impact on the world, and challenged all of us to do more to use our resources to do good. And he's right. Businesses have so many assets, and so many skills in delivering quality products at scale, that to point all that infrastructure solely at wealth creation seems like a wasted opportunity. Business in the Community's new "business connectors" programme is putting resources from major UK businesses like BT and Greggs on the ground, in communities, doing excellent work joining things up and making things happen.
And this is all good stuff. The PM's call for businesses to take more responsibility is very welcome at a time when there is so much pressure on the private sector to give back to the communities from which it profits, and in which it resides. I was even vaguely in agreement with the Prime Minister when he said:
“In recent months we’ve heard some dangerous rhetoric creep into our national debate that wealth creation is somehow anti-social, that people in business are somehow out for themselves... Business is not just about making money, vital as it is, it is also the most powerful force for social progress that the world has ever known.”
The point at which I felt a little uncomfortable though, was when he attacked what he called:
“the snobbery that says business has no inherent moral worth like the state does, that it isn’t really to be trusted, that it should stay out of social concerns and stick to making the money that pays the taxes.”
Of course there is a value to these corporate-sponsored projects to deliver value to communities and improve society, even if it is mostly felt by the people inside Government who are aware of just how much large-scale public services are starting to cost. But when Mr Cameron spoke out firmly in defence of the value of, for example, great schools run by banks, and workplace education placements delivered by supermarkets, I felt uncomfortable. So I was surprised when he questioned the motives of people, like me, who feel uncomfortable about such things.
I felt it was disingenuous to suggest that anyone who is suspicious of corporate-backed social projects is some kind of snob, acting not in the public interest but according to a misplaced and rather grubby ideology. This attitude seems uncharacteristically dismissive of the natural vigilance that many people display over our civic institutions, always checking that our public institutions are being run in the interests of the people and not private interests, ensuring that democratic processes are followed, and championing the most vulnerable so that they are not left behind.
When talking about the contribution business can make to improving society, we would do well to remember what private businesses are created to do, which is to maximise profits for their shareholders. I am a Director of two for-profit businesses, and that is my job, as laid down by statute: to make money, not for the wider community, but for the few people who are hard-working or fortunate enough to own shares. In some businesses, the beneficiaries are the staff, such as in partnerships or staff-owned co-operatives; in others it is the customers, such as in Industrial and Provident Societies; but for most, the beneficiaries are the shareholders. Not the public. Not society. Just a few private individuals within it.
And that's fine. I'm quite happy to make money for my shareholders, if I can, particularly if they have taken risks with their own money to back businesses which I believe should exist in the world. What isn't fine is to pretend that the company structure we have built to do that work has any other higher purpose, or to criticise people who are suspicious when companies that are legally obliged to maximise profits for their owners claim to be interested in anything else. I can talk all I want about my desire to improve society, but when I go to a Board meeting I am bound by company law to put those considerations to one side and focus instead on growing the profits of the business.
This is not purely a problem that affects for-profit companies. Just in case anyone thinks I am being an anti-business snob at this point, I should add that even non-profit businesses have their own agendas too, whether that's to serve a vulnerable minority or to champion a particular agenda.
There is only one institution in this country that is legally obliged and institutionally accountable to act in the interests of all the people of this country, and that is the State.
That's why we have a State.
I know it is hard to argue with a well-intentioned project that is persuading private businesses pledge £750m over four years to good works in communities, and I don't wish to denigrate the excellent work that is taking place in the Corporate Responsibility world. The more businesses can be involved in the work of improving our society the better, because our businesses are part of our society just like anyone else. Bring it on guys, you are very welcome here.
But I think it is just as important for us to have a strong "Fourth Estate" of journalists, scrutiny bodies and concerned citizens, a proud tradition of so-called "snobs" checking that if our public institutions are to be funded by private interests, they do not end up acting in them.
To do anything less would be an admission that we can no longer afford democracy.
