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There is a strong connection between the Occupy Wall Street movement – which is said to have spread to more than 900 cities worldwide – and what I call ‘transformative CSR’ or ‘CSR 2.0’, albeit an overlooked one. At its essence, the movement is an expression of indignation about the cancer of greed that has been cultivated by Western-style capitalism. In my book, The Age of Responsibility, I devote a chapter to the Age of Greed, which I argue began in 1972 with the creation of derivatives trading (and, hence, the birth of the casino economy that John Maynard Keynes warned against 40 years earlier) and reached its peak in 2008, with the collapse of Lehman Brothers and the global financial crisis that ensued.
The Age of Greed refers to a prevailing culture of short-termism, shareholder tyranny, profit-maximisation and growth obsession, which most CSR practices have failed to challenge in any way. This has to do not only with irresponsible banking and Wall Street practices that privatised benefits and socialised costs, but also the more systemic and worrying trends in income inequality, between rich and poor countries, between the rich and poor within countries, and also between top management and average workers within firms.
In 1965, US CEOs in major companies earned 24 times more than a typical worker, but that ratio grew to 35 in 1978 and 71 in 1989. By 2000, it had hit 298 and, despite falling to 143 in 2002 (after the post-Enron stock market slump), it bounced back and continued rising through the naughty ‘noughties’.
In 2007, despite the looming recession, CEO pay of the largest 500 US companies averaged $10.5m, 344 times the pay of typical American workers and 866 times as much as minimum-wage employees. These trends echo the Occupy movement’s slogan: “We are the 99%.” By implication, they are throwing a spotlight on the self-enriching and increasingly rich 1%: the super-rich elite.
But is the Occupy movement making a difference? I am reminded of Richard Beckhard and David Gleicher’s Formula for Change: D x V x F › R, where D = Dissatisfaction with how things are now; V = Vision of what is possible; F = First and R = Resistance, concrete steps that can be taken towards the vision. I strongly believe the missing element on issues of sustainability and responsibility has been widespread dissatisfaction with the status quo, so the Occupy movement is a good sign.
On the other hand, I am reminded from my own history as a South African that it took more than 40 years of sustained, organised protest to challenge the power of the apartheid government. I believe this will be a similarly long battle, especially given the powerful vested interests of big trading blocks and companies.
Greed has proved to be a high octane fuel in the rocket engine of globalisation. But, ultimately, it is an economic missile without a moral guidance system. Can CSR provide that moral compass, or is it too tame, complicit and corrupted by the vested interests it serves? that is the trillion dollar question of our time.
Dr Wayne Visser is CEO of CSR International. His latest book is The Age of Responsibility: CSR 2.0 and the New DNA of Business. www.waynevisser.com
