ISSUES
: Business and Trade
Chapter 1: Business today
13
the ‘triple bottom line’ of profit, people
and planet, guided by their sense of
corporate social responsibility.
But ‘crime in the executive suites’ has
always been bigger than ‘crime on
the streets’. Events since 2008 have
revealed how colossal today’s ongoing
corporate crime wave is. The investment
banks almost brought down the major
economies. Then we learned that they
had also been fixing the world financial
casino. The high street banks have
practised endless and systematic mis-
selling – fraud by another name. The level
of PPI compensation alone suggests that
on average each high street branch of a
UK bank may have been involved in mis-
selling policies worth millions. And we
know from Lloyds that this often involved
senior staff browbeating low-paid junior
employees into doing their organisation’s
dirty work.
Swathes of private companies are
essentially corporate welfare subsidy
junkies. UK corporate welfare costs have
been estimated by one critic to run to £85 billion a year.
Corporate hand-outs extend from cushy PFI deals to
direct and indirect subsidies, tax breaks and even a
bit of free labour thanks to the UK benefits system.
Company performance, even when masked by
creative accountancy and boosted by low pay for the
bulk of their workers, is often lamentable. Yet bosses
filch ever more, supported by indulgent boards and
compensation committees whose real function
appears to be sustaining grotesque pay levels. And
when activity involves criminality that falls within the
scope of UK law and law enforcement, then it is rare
that any serious sanction follows. Margaret Hodge has
rightly questioned why Serco and G4S are able to bid
for more contracts while both being investigated for
alleged fraud. And taxes – well to paraphrase Leona
Hemlsey – only little people, and little companies, pay
taxes.
Student moans
Some good research is done in business schools
– ironically driven there by the very irrelevance of
much of the work in economics departments. One of
the most important centres of critical analysis in the
UK, for example, is Manchester Business School’s
Centre for Research on Socio-Cultural Change. At
Essex University, Professor Prem Sikka has played
an important role in challenging many accountancy
fiddles.
Almost every university has a business school where
many times more people study than in economics
departments. Yet our courses barely reflect the
problems that we have with business. Perhaps to
understand this students might better invest in a
subscription to
Private Eye
than another glossy
textbook.
What we need is a new Sutherland for 21st-century
business schools. It would not be difficult. Think how
many index cards we could fill with tax avoidance. Or
what about money laundering? London is reckoned to
be the world’s biggest money laundering centre. And
it has been the storm centre for the dodgy dealing
behind many a global financial collapse – some say
back to the South Sea Bubble. Then what of the cards
for the super-rich? The idea that the UK is ‘open for
business’ means any oligarch can use the UK to hide
their wealth, buy up assets and deploy the courts and
the law to fight their legal battles.
Business schools need to confront this world of
business as it is. Our students might be our best allies.
Many of them will be in low-paid part-time jobs; they
will be living in buy-to-let properties or in private halls
owned by multinationals. They will be worrying about
debts that extend into the foreseeable future. And
social inequality in the jobs market and the nepotistic
social hierarchies of UK higher education institutions
will loom ever greater as they get closer to graduation.
Real-world business studies can also start close to
home.
18 December 2014
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