The Dance of the Corporate Veil

17-07-2011

Two very different news stories hit the headlines this week Ã¯Â¿Â½ one to do with the pollution of rivers in China, the other to do with hacking of personal information by a newspaper; you may have heard of one of them.

Although the stories are different, they both have the same foundation Ã¯Â¿Â½ the companies behind the companies claim to know nothing about whatÃ¯Â¿Â½s been going on. The Corporate Veil has been drawn over proceedings and its business as usual Ã¯Â¿Â½ just a bit of local damage to sort out.

A core value of Sustainable business behaviour has to be transparency, at all levels of the Business and within each layer of Business. Corporate Governance is a grand term for something that, in a reasonable world, shouldnÃ¯Â¿Â½t be an issue in the first place. But the problem is, as media headlines have been reminding us, that the day-to-day business of Business obviously does need a health check, and on a regular basis. So a formal statement of how Business is to be done makes for an excellent starting point.

When the news comes through that rivers are being polluted by a Business Group with whom your Company has a contract, it is not a reasonable excuse that, because your company was dealing with some other part of that Group, you cannot be considered responsible for such nefarious goings-on. Because, actually Ã¯Â¿Â½ you can feel very responsible indeed.

Outsourcing is a great smokescreen for dodgy business behaviour. Shifting industrial production to countries that do not have the same kind of employment / environmental / management controls that we enjoy here in the Ã¯Â¿Â½more matureÃ¯Â¿Â½ democracies provides many profitable opportunities for financial cheating, for exploitation of the workforce, for degradation of the natural world. Take your pick Ã¯Â¿Â½ itÃ¯Â¿Â½s all out there.

A strong commitment to Corporate Governance that goes as far as demanding the same level of behaviour from outsourcing suppliers as you require of yourself is one way of shining a light into the grubby recesses of this end of Business Ã¯Â¿Â½ and it can also put an end to the practice of The Dance of the Corporate Veil.