A real winner would have sold the stock in advance. This week, with the moral authority that comes from the abs you can slice sushi on, Cristiano Ronaldo pulled out two bottles of whole Coca-Cola from a press conference desk and saluted The water rather.
Censorship of the most followed human on Instagram would sting any business. The same would be true for the next $ 4 billion in market value. But few also doubt themselves that Coca-Cola. Its “Business and Environment, Social and Governance Report 2020” (yes, two “and”) is a 82 pages apologies for its commodity, if not the trade itself.
At this point, it’s natural to pit the piety of modern business against its Rococo tax schemes. (Sure enough, Coke has had tax problems with the federal government.) But I no longer see the former as incompatible with the latter. It is best understood as an outgrowth of it. The rise in “CSR“and”ESG– how cant loves acronym – reflects the gradual decline in the effective corporate tax rate.
The logic of the C-suite is transparent: what we deny to the common purse, we repair, or at least scramble it, by other means. It is not only guilt that makes a multinational speak the slang of the cultural left. It is not only naivety that prompts a bank to hire phalanxes of sustainable development consultants. This is the calculation. A cunning fox throws dogs out for the scent.
If I am right, it follows that higher and better applied taxes will spell the end of the mining company. Essentially, companies will buy the right to relive life without commitment. We can go back to a time when producing the things people want, and sharing the revenue with government, was a social good. In this sense, a stricter tax regime is a strengthening of capitalism. Few things congratulate the recent G7 agreement on the topic more. Few things make the opposition of so-called conservatives stranger.
1984, the least premonitory thing Orwell ever wrote, misinterpreted the left trajectory. The force to come was not the state, which even in Russia peaked at the time of publication. It was the Gramscian walk through institutions. And the result would not be totalitarian, just disgusting and arrogant.
A harmless manifestation of this is group therapy as a workplace. Call me British, but I expect an employer to send the monthly transfer and meet the legal minimum for paid holidays and the like. If they help me through a difficult time, they can expect mutual loyalty. What I do not want is to enter into pastoral communion with them or to remake the world together.
The truly messianic enterprise is much more frightening. Coca-Cola wants its US workforce to “line up” with ethnic census data, like a Singaporean housing block. Microsoft’s CSR mission aims for immigration reform, a better response to humanitarian crises and “alternatives to imprisonment”. It sounds like a political party’s platform (to be clear, I would vote for) and sometimes like a nation-state’s bill of rights. Even though you can live with the government’s tax starvation, who believes this line of Napoleonic activity to be good through business? Who thinks it is, in the old sense, sustainable?
Christopher Hitchens had a response when the well-meaning but tasteless stood up for believers who don’t proselytize or act on the wickedest bits of scripture. “All you’re saying is these people are so nice that they’re not religious at all.
It’s CSR everywhere. The bottom line is that a business is good precisely insofar as it does not act like a business. Job creation, innovation, consumer choice: these are all given. In its own please report, Nike assures adults who buy its silly shoes that at least 1.5% of gross revenue is spent on “community impact.” The implication is that hiring people has no impact on a community.
As an intellectual concession, it is vast, and companies have accepted it as a cover to stiffen the tax authorities. The insult to the State is fairly well ventilated. It is the disservice rendered to capitalism itself that is built up insidiously over time. The immediate money saving is not worth the long term fouling of the atmosphere in which businesses must operate. The obvious way out of this trap seems costly. It is, in fact, a godsend. Give back to Caesar what belongs to Caesar.
Email Janan at janan.ganesh@ft.com
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