Ethical commerce is leading fashion

John Gummer
OST OF US can remember when it was the generally accepted view that commercial companies could not have moral views. Executives were wont to say that the interests of shareholders meant that they could not intrude their personal values and standards into business transactions that could be governed only by the law.
Now, that attitude has changed significantly. Shell learned the hard way that its actions in Nigeria, although entirely legal, would be judged by standards that reached significantly beyond what the law demanded. One of the central effects of globalisation is to change the moral demands that we expect of multinational companies. They can no longer expect to be able to plead local custom in order to defend double standards in issues of morality, environment, employment or human rights.
To be fair, many of the world's best have pioneered this change from inside the corporation. BP and Unilever are companies that have taken these responsibilities seriously and not just from economic motives. There is a corporate culture that demands the highest of standards and has learned that such an attitude can properly be defended as giving the company a competitive edge.
And so it does. Increasingly, risk to reputation is seen as a major financial concern. Nike — the sportswear and shoe manufacturers were seriously hurt by the allegations of using underage labour. MacDonalds' hamburgers were not produced by cutting down the rainforest, but the very allegation that they were, did them huge damage. So too with Nestld, still dogged by the claim that they act unethically in the sale of baby milk in developing countries. Again, there is no truth in this today, even if there ever was, but this great business still suffers from the consequences. It is not surprising that most multi-nationals now seek to establish high standards of ethical behaviour worldwide.
Perhaps surprisingly, there are still some major exceptions that have proved resilient to the power of concerned consumers and the investigations of the media. Exxon, the mighty parent of Esso, still arrogantly denies any responsibility for the pollution that leads to climate change. Elf Aquitaine and ICI continue to press the claims of HFCs in refrigeration and air-conditioning, despite the fact that they contribute hugely to global warming. The garment industry as a whole has still too many examples of sloppy procurement that means that child labour is used to produce their products.
In general, however, the new-found understanding of the importance of reputation is putting real values at the heart of business practice, particularly in multinational companies that feel most exposed. A dramatic exception is the fashi onw ear business Calvin Klein. A worldwide symbol, recognition of the letters CK was said by one commentator to be the test of whether a nation has really ceased to be communist. ff CK were widely recognised in society — capitalism had won! Yet this trendsetter has bucked one trend — that of growing corporate ethical responsibility. Its menswear advertisements have long been criticised, but the attacks have grown in sharpness as proposed new children's advertising was seen as even more pornographic and had to be withdrawn.
There has also been a continuing succession of allegations about the labour conditions in which CK fashion garments are made. Ethical responsibility seems one fashion they have not yet embraced. Perhaps Catholics should use their consumer power to encourage CK to catch up with a corporate fashion for moral behaviour that we should welcome.