BOOKS: WE'RE ALL CITIZENS - The case for corporate responsibility is made eloquently in this book, says Charles Secrett. The New Global Investors; by Robert AG Monks; Capstone pounds 20

BOOKS: WE'RE ALL CITIZENS - The case for corporate responsibility is made eloquently in this book, says Charles Secrett. The New Global Investors; by Robert AG Monks; Capstone pounds 20 - Robert Monks has written a timely book. We live in an age where com

by CHARLES SECRETT, the director of Friends of the Earth
Last Updated: 31 Aug 2010

Robert Monks has written a timely book. We live in an age where companies are getting bigger and bigger, often outstripping the willingness of governments to control them. This is not a good thing. Corporations are filling the power vacuum left after the collapse of communism. And their managers, boards and owners (the investor class) are failing to ensure that they work efficiently and in the public interest.

Real-world mega-corporates often make countries look small. Activities from deforestation to flogging fossil fuels eradicate the planet's rich biological resources and destabilise the climate - and condemn sovereign nations to death, with low-lying island states disappearing.

But don't despair. Giants always topple. Despite their pernicious size, destructive activities and questionable practices, even the biggest firms are beholden to consumers and constituents. That is the beauty of regulated markets and democratic political economies. Groups like Friends of the Earth provide the arguments and campaign opportunities for green voters, taxpayers, shareholders and consumers to hold companies (and governments) to account. And they do so.

Monks usefully - if too briefly - draws lessons in good corporate citizenship from NGO-inspired campaigns, including Seattle and the WTO, Shell and Big Oil, and the biotech industry. For him, the challenge is to solve the endemic problem of the passive owner - these days usually institutional investors, such as pension funds. He astutely analyses how prevailing company practices and policy too often circumvent existing safeguards and watchdogs.

His first steps for wider company reform include full disclosure of all impacts on society, restraint and integrity in dealing with government, and the exhortation to stay legal. Such obvious common sense. The fact that democratic norms have to be spelt out merely emphasises the scale of the problem of the lack of corporate accountability.

Others have written more passionately and more convincingly on the threats to environment, culture and society by mega-corporates, notably George Monbiot and Naomi Klein. But Monks' drier style and institutionally based prescriptions (apart from pay restraint!) are more likely to appeal to the executive mind.

So give a copy of the book to your favourite CEO, board member or pension fund manager. They will learn things that will make them much better at their jobs.

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