Arabica Robusta's List: business and development

• MIGA claims that insurance is only provided if a project is judged to be: economically and financially viable; in line with a host country�s development objectives and labour standards; and is "environmentally sound."
• However earlier this year the Compliance Advisor Ombudsman (CAO) criticised the due diligence of MIGA with respect to investment in the copper-silver mining project in Katanga, in the Democratic Republic of Congo. The audit concluded that risks to local communities and human rights were not adequately considered. A MIGA backed paper mill in Fray Bentos, Uruguay, has also been the centre of some controversy. The Center for Human Rights and Environment has filed complaints with the CAO and the Inter-American Commission on Human Rights (an organisation to ensure adherence of international human rights law in the Americas). Allegations centre on the violation of MIGA's environmental and social safeguards, the abuse of the human rights of local stakeholders, which includes violations of the rights to: participation; access to information; development; health; a healthy environment; and the right to water.

• Political watchers here believe the Bill was rushed through parliament in time for the Donors’ Conference on Sierra Leone, held in London, from Nov 1 to Nov 20.
• "The section that says the minister, director and other officials of the ministry cannot be prosecuted in the line of their duties, as long as they act in good faith, is unacceptable. This concentrates power in the hands of the officials, and leads corruption and abuse of office."
• Leslie Mboka, of the Coalition of Activists on Just Mining, told IPS: "The Act is faulty, and needs to be withdrawn and re-written. It simply gave excess powers to the minister and his officials, giving them immunity from prosecution.

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• CSR is responding to major structural drivers and expectations of investors, employees, NGOs, global media, governments and society at large - stakeholders who will reward companies that "get it right" and punish those who get it wrong.
• CSR is relevant to businesses of all sorts and sizes, although global corporations subject to tremendous stakeholder scrutiny and pressure (by NGOs such as Greenpeace and Amnesty International, governments, the global media, international organizations and unions) have taken it up to a greater extent either as a result of various scandals or in order to achieve the various business benefits and proactively maintain their "social license to operate."
• notions of CSR were "present at the inception" of the corporation. From the very inception of bodies corporate, such as the Roman societates, through medieval bodies corporate (universities, cities, guilds), and even chartered companies of the age of exploration, and the colonial companies and corporate churches, utilities and charitable entities involved at the founding of the United States of America, corporations have generally had public as well as private purposes (although companies like the British and Dutch East Indies companies also caused great harm).
• The ultimate cause of the crisis was the ideological embrace of Milton Friedman's warped but still dominant view that "the only social responsibility of business is to make a profit for its shareholders," and until that socially and economically counterproductive - and empirically, legally and ethically inaccurate - view is corrected, we will continue to have the increasing and more intense crises of global capitalism that we have seen recur with ever greater frequency over the past forty years.
• A variety of new management tools ranging from online guides to human rights impact assessments (complementing the more traditional environmental risk assessments) now exist to help manage CSR in a responsible fashion and ensure it is not treated as a mere "add on."

• How do you make CSR part of the corporate culture?

   

  Pitts: As with the question of human rights and environmental compliance in society at large, this is in fact the most critical question. The law and market incentives are inherently limited - they can only go so far without risking counterproductive legal, practical or market failures. So even though (as discussed above) CSR involves compliance with law and is also "enforced" through both positive and negative incentives, both practical experience and academic research indicate that it can all be fruitless unless the culture and values of the company support CSR and accountable results.

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• Without a  doubt, the practical establishment of this world of struggle would  not succeed so completely without the complicity of all of the  precarious arrangements that produce insecurity and of the  existence of a reserve army of employees rendered docile by  these social processes that make their situations precarious,  as well as by the permanent threat of unemployment. This  reserve army exists at all levels of the hierarchy, even at the  higher levels, especially among managers. The ultimate foundation  of this entire economic order placed under the sign of freedom is  in effect the structural violence of unemployment, of the  insecurity of job tenure and the menace of layoff that it implies.  The condition of the "harmonious" functioning of the individualist  micro-economic model is a mass phenomenon, the existence of a  reserve army of the unemployed.
• Economists may not necessarily share the economic and social  interests of the true believers and may have a variety of  individual psychic states regarding the economic and social  effects of the utopia which they cloak with mathematical reason.  Nevertheless, they have enough specific interests in the field of  economic science to contribute decisively to the production and  reproduction of belief in the neoliberal utopia. Separated from  the realities of the economic and social world by their existence  and above all by their intellectual formation, which is most  frequently purely abstract, bookish, and theoretical, they are  particularly inclined to confuse the things of logic with the  logic of things.
• All direct and conscious  intervention of whatever kind, at least when it comes from the  state, is discredited in advance and thus condemned to efface  itself for the benefit of a pure and anonymous mechanism, the  market, whose nature as a site where interests are exercised is  forgotten. But in reality, what keeps the social order from  dissolving into chaos, despite the growing volume of the  endangered population, is the continuity or survival of those very  institutions and representatives of the old order that is in the  process of being dismantled, and all the work of all of the  categories of social workers, as well as all the forms of social  solidarity, familial or otherwise.
• Like it or not, the public interest will never  emerge, even at the cost of a few mathematical errors, from the  vision of accountants (in an earlier period one would have said of  "shopkeepers") that the new belief system presents as the supreme  form of human accomplishment.

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• Doing Business is put out jointly by the World Bank and its private sector arm, the International Finance Corporation (IFC), both based here in Washington, and has become one of the bank’s most high-profile publications.

   

  “Over the decade that it has been published, Doing Business has achieved a great deal of influence,” Trevor Manuel, South Africa’s planning minister and chair of the review panel, said Monday at the audit’s London unveiling.

   

  “It is the leading tool to judge the business environments of developing countries, generating huge global media coverage every year. Several countries – such as Rwanda – have used it as a guide to design reform programmes.”
• Yet for this reason, critics have for years warned that the report was pushing countries to lower taxes and wages and weaken overall industry regulation, thus potentially endangering the poor.

• “Removing it would defuse many of the criticisms levelled against the report, but would diminish the report’s influence on policy and public discussion in the short term. In the long term, however, doing so may improve focus on underlying substantive issues and enhance the report’s value.”

   

  The report also calls for greater transparency within the reporting and evaluation processes, and urges the bank to move the report’s “home” from the IFC to the research department within the bank proper. This latter recommendation could be particularly important given past criticisms that the Doing Business team has been reticent to implementing any major changes.

• The past year has seen significant pushback against such criticism of the rankings, from prominent voices within the business community as well as certain development scholars.

   

  “I think these rankings really do have fundamental value, as without the rankings the Doing Business report is just one more research exercise among many the World Bank does,” Scott Morris, a visiting policy fellow at the Center for Global Development, a Washington think tank, told IPS.

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• Although this plutocratic sector is privately governed, it is publicly subsidized. Private foundations fall into the IRS’s wide-open category of tax-exempt organizations, which includes charitable, educational, religious, scientific, literary, and other groups. When the creator of a mega-foundation says, “I can do what I want because it’s my money,” he or she is wrong. A substantial portion of the wealth—35 percent or more, depending on tax rates—has been diverted from the public treasury, where voters would have determined its use.
• Mega-foundations are more powerful now than in the twentieth century—not only because of their greater number, but also because of the context in which they operate: dwindling government resources for public goods and services, the drive to privatize what remains of the public sector, an increased concentration of wealth in the top 1 percent, celebration of the rich for nothing more than their accumulation of money, virtually unlimited private financing of political campaigns, and the unenforced (perhaps unenforceable) separation of legal educational activities from illegal lobbying and political campaigning. In this context, big philanthropy has too much clout.
• The roles of grantor and grantee have also changed. Once upon a time, the mega-foundations established a goal and sought experts to do independent research on how to achieve it. Today many donors and program officers have preconceived notions about social problems and solutions.
• Sycophancy is built into the structure of philanthropy: grantees shape their work to please their benefactors; they are perpetual supplicants for future funding.
• For a dozen years, big philanthropy has been funding a massive crusade to remake public education for low-income and minority children in the image of the private sector. If schools were run like businesses competing in the market—so the argument goes—the achievement gap that separates poor and minority students from middle-class and affluent students would disappear. The Bill and Melinda Gates Foundation, the Eli and Edythe Broad Foundation, and the Walton Family Foundation have taken the lead, but other mega-foundations have joined in to underwrite the self-proclaimed “education reform movement.” Some of them are the Laura and John Arnold, Anschutz, Annie E. Casey, Michael and Susan Dell, William and Flora Hewlett, and Joyce foundations.
• Most critiques of big philanthropy’s current role in public education focus on the poor quality of the reforms and their negative effects on schooling—on who controls schools, how classroom time is spent, how learning is measured, and how teachers and principals are evaluated. The harsh criticism is justified. But to examine the effect of big philanthropy’s ed-reform work on democracy and civil society requires a different focus.
• In 2009 the Gates Foundation funded the creation of a nonprofit organization to stir up grassroots support for the foundation’s teacher effectiveness reforms. The reforms used students’ scores on standardized tests to evaluate teachers and award bonuses, abolished tenure, and ended seniority as a criterion for salary increases, layoffs, and transfers. Gates paid a philanthropy service group called Rockefeller Philanthropy Advisors (RPA) $3.5 million to set up the new nonprofit. Its staff would target four “sites”—Pittsburgh, Memphis, Hillsborough County (Tampa, Florida), and a consortium of Los Angeles charter schools—where Gates was about to invest $335 million to try out its reforms. RPA’s confidential proposal, which was leaked to the media in 2011, described a potential pitfall for “Teaching First” (the nonprofit’s provisional name):
• Big philanthropy’s role in the trigger law began with Green Dot, a charter school company with funding from Gates, Broad, Walton, Annenberg, Wasserman, and other foundations (for a detailed account of events, see Gary Cohn’s excellent exposé, “Public Schools, Private Agendas: Parent Revolution,”
• Despite its obviously political agenda, ALEC is a tax-exempt nonprofit. The Gates Foundation gave the group a $376,635 grant in 2011 “to educate and engage its members on efficient state budget approaches to drive greater student outcomes, as well as educate them on beneficial ways to recruit, retain, evaluate and compensate effective teaching based upon merit and achievement.” After several exposés of ALEC’s work prompted some corporate members to resign, the Gates Foundation announced in 2012 that it would finish out its grant to ALEC but not undertake future funding (Roll Call, April 9, 2012).
• Private foundations have used another tactic to exert influence on the Los Angeles Unified School District: they paid the salaries of more than a dozen senior staffers. According to the Los Angeles Times (December 16, 2009), the privately financed “public” employees worked on such ed-reform projects as new systems to evaluate teachers and collect immense amounts of data on students.
• Big philanthropy is overdue for reform. The goal should be to reduce its leverage in civil society and public policymaking while increasing government revenue.
• Meanwhile, the public needs more critical, in-depth information. The mainstream media are, for the most part, failing miserably in their watchdog duties. They give big philanthropy excessive deference and little scrutiny. Public television and radio live on big philanthropy’s largess. Collaborative programming with mega-foundations has undermined the credibility of major for-profit news organizations as well as public media, especially on health and education issues.
• Early twentieth-century skeptics were rightly suspicious of plutocrats deciding how to improve the human condition and then paying to translate their notions into public policy. Now it’s time for a new progressive era—complete with muckrakers and trust-busters to cast a critical eye on big philanthropy.

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