Today Boeing acknowledged that it had made mistakes with its MAX 737 aeroplanes. It transpires after two crashes. they were quick to blame the deceased pilots for errors they made. Now they accept they were due to the company itself underperforming. It was forced to make this announcement when their planes were grounded – literally for months. In those months the reputational damage has almost sent the company to the wall. The announcement is expected to give the company time to reverse its fortune but great damage has been done.
If this company was alone it would be shocking. I am not a shareholder in Boeing, but likely as not you might be. If you have superannuation you might indirectly have an interest in this and many hundreds of other companies. I have a small shareholding in some companies, and is in my interest the shares do well. This is the lot of retirees. We all want the biggest return we can get from whatever money we have put aside, yet I believe, none of us want the companies we are invested in to cause harm.
Perhaps the reason they do is the understanding directors have a moral duty to put the interests of the shareholders first. However if directors do this without consideration of the social responsibility their companies have then they are complicit in the destruction of their community and need to be held to account. How else can the Fair Work Ombudsman have collected fines of over $200 million in the last twelve months from other unscrupulous companies?
(The story of industrial relations in Australia is long and tortuous but it is worth reading. However it is too difficult to weave into this simple essay – of how greed now determines action.)
I have worked for the government, and I have worked for major corporations. When I was working I wanted (my) business to succeed. I still want business to succeed today. Despite this when it comes to business I am totally lost as to what has happened to institutions the community once implicitly trusted. ( I no longer trust business to do the right thing, and I have learned governments put the interests of business petitioners before voters.)
What has happened with Boeing might just be a blip, but when multiplied by all the other blips in business, as it is practised today, it becomes a flood of bad practice. In Australia we are working through the damage a Royal Commission into Banking has uncovered. The right wing government we have, argued for years an inquiry was not going to find anything. It could all be corrected by regulation they said. In the end to appease the middle ground they were forced to agree to one. Since the Royal Commission they have had to limp along through the embarrassing findings against banks and recognise its worth and condemn the businesses they said poised no difficulty.
The banking royal commission is a big sign all is not well. Despite this the government believes, when big business does well everyone does well. Their argument is the profits earned by business will flow through the economy to the meekest of workers if it is unregulated.
Regulation today is a bad word, and yet it was once considered necessary because it harmonised the world we knew. When I paid attention in my Economics class we were told the government worked for its populace. It provided housing for the homeless. It provided water and power. It played a significant part in communications. We had the Postmaster General Office – from that service we got telephone and mail. Government regulated the price of basic food including milk and bread. The opposite view is “ let the market decide” and it gives no thought about basic human needs.
You don’t have to be an economist to see things are broken. The news that one of our largest companies Woolworths Ltd has underpaid workers, perhaps $300 million over nine years, is hot on the heels of the news a couple of celebrated chefs have been caught doing the same thing for $7 million and $10 million. The argument used is they were too busy to understand the complex employment rules.
I can go on and reference Seven Eleven, Retail Food Group, and even the Australian Broadcast Commission itself has failed in the same way. Each claims the underpayment to their workforce was an unprecedented error. Surprisingly the underpayments were as a result of accounting mistakes. Not so astonishingly no major company appears to have made an error of magnitude where mistakes have lead to overpayment.
With the demise of the unions we have seen a casualisation of the work force. When companies chose executives without life experience, staff are seen as a cost of production. When that happens the contract between labour and production is broken. Loyalty unrewarded means a loss of pride in staff output. Work becomes a means to an end to employer and staff. Jobs are lost. People are under employed and those that are not can have their work terminated simply by falling off the work roster – especially if they cannot work whenever it suits the employer.
Surprisingly the world has returned to the inequalities of the period the Austin women, especially those books of Jane and Honore de Balzac, as they wrote about in the early eighthteenth century. Their world was a period where wealth was concentrated in the hands of few. Since the end of WW11 the spread of wealth has reduced. Today less than 1% of the people on earth control almost half of all the wealth. In reverse – about 70% of the global population have less than $10,000 in assets. Is it any wonder the Panama Papers uncovered so many people and companies hiding their wealth from regulators rather than do the correct thing and pay taxes?
At the time of the Austin’s and Balzac the country of Wales produced Robert Owen. He was an industrialist with extreme wealth, yet he understood if he improved the lives of his workers it would not cost him but reward him. He started schools for his workers. He built a model town. (It stands today as New Lanark in Scotland.) This model town showed wealth was best spent on improving the lives of people. (His is a life worth understanding.)
The first fifth of the twenty-first century is gone. The world needs a new Robert Owen much more than it needs weapons and nationalism. It is my belief wealth is not wrong but it would be better if it reverted to the state at the end of life. Inherited wealth is a curse to mankind because the beneficiaries lose. What they lose is an understanding of the equality of mankind.
I have had my say. I will remain ignorant there are other sides to my statements if you do not tell me. Write a few words and explain where I have got it wrong. I will thank you.