Monday, 7 July 2014

'The sustainable business of government'

Corporate sustainability experts on Africa are right to recognise the state's important role, but wrong to assume that the issues are only apolitical ones of capacity and know-how.

Toby Webb's recent piece for Ethical Corporation addressed a major theme of this blog, when he wrote on big business in developing countries engaging host governments on longer-term sustainability issues.

Webb was right to the extent that he implies that however good a firm's sustainability and impact practices, policies and programmes are, scaling-up and sustaining these things requires the governance and other contributions of a cooperative and capable regulatory state. His post was unobjectionable on a number of other fronts, particularly the need for systematic engagement by firms (including in sector or cross-sector coalitions) with host governments on development impact issues.

However, I'm not entirely sure about the premise of his post. (He also runs together developmental impact with political risk exposure, for example referencing GSK's woes in China, in ways that avoid addressing how these things might be linked).

The premise of his that I'm not sure of has two legs.

First is that officials in developing countries are out-of-date and simply not aware of current business-and-society trends, so that if firms simply engage with and 'educate' their hosts, relations will run smoothly and big business can pursue sustainable, pro-development practices.

Second is the related implication that there is (as he writes) a "right role for business" in meeting social goals, an uncontested obvious balance, an ideal business-society-government model that can get on with sustainable development if only the ignorance and incapacity of host government officials could be addressed.

This is naive stuff from someone with such experience in sustainability issues. At least in the African region I know best, questions around the role of business in society -- and its delivery or regulatory role relative to the state -- are deeply political (not technical), open and unresolved (not simply 'obvious-but-not-known-about-yet'), and hardly 'fixable' simply by educative engagement.

For example, Webb's suggestion that officials retreat into populist regulatory postures simply because they have not yet been exposed to the gospel of modern sustainability practices is both highly patronising and naive about the political uses that local officials and politicians will continue to make of big business and foreign investment.

Some of these issues are certainly amenable to moderation by greater dialogue, trust-building, role-allocation and so on between big firms and host governments. But Webb is wrong, at least in Africa, to suggest a 'right' business-government-society model sits out there, waiting for firms to enlighten their hosts about. Just as Tony Blair was wrong in 2012 to suggest Africa had reached the 'end of history' and was now awash in consensus on the 'right' models of governance (see this 2012 post critical of Blair).

The point is that vital issues around responsible and sustainable development, and the relative roles of business and government in relation to public goods, are not advanced by assuming that what we have is advanced, enlightened firms and backward, ignorant host regulators and officials. Nor is there one right way.

These false premises aside, then yes the sustainable development agenda certainly requires more systematic and strategic engagement between firms and host governments at various levels (subject to this recent post questioning the value of simply asserting the need to 'engage'!).

In the same way, regulatory incapacity is a real issue and there is a role for big business in building the capability of host governance institutions, as outlined in this post over two years ago.


No comments:

Post a Comment