Market leaders in trust and integrity

An East African trainee teacher describes how he was cheated out of his income. As part of his degree, he taught in a private school for 26 hours--but was only paid $12, about a quarter of what he was owed. There was no written contract and he thought it was an agreement based on trust. Now he feels betrayed, and comments that in future he will have 'a hard time trusting private investors'. However as a Christian he has resolved to 'take my experience positively and continue with life'.

The student teacher tells his story during a workshop on 'ethical leadership in business'--billed as for those at the start of their careers--during the Caux conference on business and values in early August.

So can there be 'trust and integrity in the global economy'--the conference title? Or will falling levels of confidence be a threat to the future? An eclectic group of business professionals, media people active in the International Communications Forum think-tank and farmers from IofC's Farmers' Dialogue have come together for six days to discuss the issues and share experiences.

The student teacher takes heart from the anti-corruption stance of Joseph Karanja (photo), who founded a legal practice in Nairobi, Kenya, in 1998 to 'send a message that lawyers too can be trustworthy'. His firm of eight is well known for fighting corruption cases for business people 'who are willing to stand for the truth' rather than pay bribes to corrupt officials. 'We have never lost a case but the city council has suffered huge losses through compensating our clients for malicious prosecutions,' Karanja says. 'We have won over 40 corruption cases in the last four years. Today, Nairobi city council will drop a case before it goes to court, when they realise that we will be defending it.'

This means a loss of income for his firm, but it has been worth it. He believes the war against corruption in Kenya has passed a turning point, despite the fact that the country's anti-corruption tsar, John Githongo, was driven overseas by death threats. Karanja speaks of 'radical surgery in the judiciary', with 12 out of 16 high court judges, and 378 magistrates,sacked in 2004 because of corruption charges. 'Several ministers of the new government, who were perceived to be untouchable, were hounded out of office.'

In his Caux Lecture, Jamshed Irani (photo), a Director on the parent board of the giant Indian conglomerate, Tata, says that he finds little in the West's emphasis on 'corporate social responsibility' that the Tata group hasn't been practising for nearly a century. The company pioneered the world's first eight-hour working day in 1912; free medical aid for employees in 1915; leave with pay in 1920; maternity benefit in 1928; the list goes on. When militant Maoists started attacking businesses in West Bokaro, Tata Steel's coal base was untouched because, claims Irani, the radicals put out the word, 'Don't disturb Tata's'. The company was supplying water and medical aid to several hundred thousand people. 'We cannot remain spikes of prosperity in a sea of poverty,' Irani comments.'

The end never, never justifies the means,' he declares. He describes how one Tata managing director was summarily sacked, prosecuted and jailed after flouting Tata's code of conduct. 'Values transmit trust. Trust is not only at the heart of leadership but forms the essence of all relationships.' India, which 200 years ago claimed 20 per cent of world trade, is now re-emerging on the world stage, with annual growth rates second only to China.

Irani deplores the current emphasis on short-term, quarterly results, which pander to shareholders. In this he is echoed by Professor Paul Dembinski, Director of the Geneva-based Observatoire de la Finance, who says that the focus on short-term dividends gives more importance to capital than to employment. Financial speculation has too often become 'mass gambling', sometimes breaking businesses and destroying jobs.

Journalists too tend to pander to the market, says South African journalist Guy Berger. They too easily 'hide behind the "ethics" of getting the story at any cost'--including lying, stealing and intruding on grieving families -- in order to give their viewers and readers what they want. 'Shouldn't the media be leading the market', by covering stories which address such issues as poverty? Berger, who is this year's recipient of the Nat Nakasa award for integrity and bravery in journalism, speaks from hard-won experience: his stance against apartheid earned him three years in jail and five years in exile.

The conference title contains a certain double-entendre: can individuals live in a spirit of trust and integrity within the global economy? And can the global economy be trusted to deliver justice and prosperity for all the world's citizens?

Canadian economist Genevieve LeBaron (photo) doubts it. 'Those who write about economic globalisation as an unambiguously positive phenomenon are not telling the whole story,' she says. As an 18-year-old serving in an orphanage in Madras (now Chennai) in south India, she passed a factory where 'young girls sat in shrivelling heat from sunrise to sunset, dipping their bare hands in toxic chemicals, piecing computer parts together. I wondered then, how are these girls benefiting from this globalised world?' That same day, Tamil Nadu state farmers crowded Madras's streets, protesting against an American corporation that was trying to patent their variety of rice.

Both situations may well have since been outlawed. But LeBaron deplores a system that excludes people, 'sometimes entire regions', from the marketplace. 'We need to question our society's conception of growth and progress,' she says. What would it take to 'shift the distributive dynamics of the global economy, to close the exponentially increasing gap in material wealth? Are we simply working towards making ourselves materially richer? What would we need to change about ourselves and the global economy to create a world in which all human beings can flourish?'

The questions are left hanging in the air. But the issues won't go away. The farmers at the conference give dire warnings about the effect that global warming, climate change and population growth will have on agricultural output.

'Global water consumption is doubling every 20 years,' says Farmers' Dialogue leader Jim Wigan. 'By the year 2025, 48 countries are expected to face chronic water shortages affecting 2.8 billion people.' There is concern that Western farm subsidies are depriving developing world growers of their markets, though Europe's Common Agricultural Policy is being cut back. With global population growth the world is going to need all the food production possible, says Wigan.

Christiane Lambert, the first woman president of a French farmers' union, insists that no farmer feels happy with relying on subsidies. But she is equally concerned about the 'psychological trauma' that French farmers face in complying with 200 European Union directives, the breach of any one of which would cause loss of income. She pleads for 'a logic of sustainable development', rather than 'liberal fundamentalism' in trade, and an urgent reopening of the Doha round of negotiations at the World Trade Organisation.

For the young entrepreneurs and activists setting out on their careers, these global perspectives provide a challenging context for their decisions and priorities. The East African student teacher comments, 'I am ready to be an instrument of change wherever I may be.' Conference co-organiser Joe Swann, who works for a company in London which helps the long-term unemployed back into jobs, is also challenged. 'Here I have met people who are not just living to work, but working to live,' he says. It has left him reflective on his priorities. Working to performance criteria can be pressuring, he adds. 'But I will never, never undermine the interests of the individuals I work with to pursue personal gain or promotion.'

In the end it all boils down to care for people, says Boston-based Ward Vandewege, a sole proprietor in software and information technology services. With customers in five countries, he has to deliver on trust and integrity if he is to compete globally. 'You have to demonstrate reliability. You have to care for your customers. The relationship of trust that you build up is essential for your business to survive. I know 90 per cent of my customers personally. And I think it makes life much more interesting.'

First published in For A Change magazine, 10 January 2006