Business transparency in an opaque world

business transparency
Oil is a dirty business – and comes with increasing risks.

No matter how hard we try, the world will always be a messy place. There will probably never be an end to dirty business. It’s difficult to see a scenario where shady deals or dodgy activities will not enable us to live our lives the way we want to, no matter what our higher principles might be. Business transparency will always be a challenging act.

Even progressive politicians, for instance, will still need more than the rightness of their arguments to deliver social good. And it’s not too difficult for the average Briton to remember a time when an ethical approach to foreign policy, formulated with the best of intentions, foundered on realpolitik.

Companies must deal in the real world, but they are under increasing pressure to be open, transparent and ethical, while continuing to give their customers what they want and expect. A pragmatic response is to try and strike a balance between celebrating what they do well and ethically, while minimising exposure to shadowy practices.

 

Openness

This is not to say this is right, just an acceptance that when confronted with such choices, many will take this as a line of least resistance. However, the momentum towards greater openness is unlikely to ease off and this relentless charge is represented clearly in this month’s EP.

Our lead story, about risks and the oil industry, illustrates the point perfectly. Regardless of carbon emissions and their impact on our climate, our civilisation functions on the burning of oil. Oil is a dirty business. The days of easy access to new sources of high-quality crude are drawing to a close, and oil and gas multinationals are on a mission to exploit the reserves that remain. Hence the rise of deep-sea drilling which, by definition, involves greater risk.

If we accept that, despite better safety measures, risk and environmental management, spills and other accidents will still be a by-product of this process, then the Deepwater Horizon disaster shows just how damaging the continued search for oil can be. Knowing this, it could be argued that we consumers also bare some responsibility for these costs by demanding the product in the first place, but that debate is unlikely to be had just yet, if ever.

 

Transactional costs

In any case, it’s easier for the oil companies to take the rap, particularly if they are not being particularly up front about the extent of the risks.

However, it’s not just the oil industry that struggles with openness and transparency. And, in addition, the ‘transactional costs’ of doing business in a different culture, for instance, and the continued use of dual-class share structures to maintain control of a corporation demonstrate that the obstacles to an ethical, unambiguously transparent business approach come in many forms and may be ever present.

• Originally published in Ethical Performance in October 2012

Advertisements

peterbatt

Peter a journalist with 30 years experience of freelance writing, UK national newspaper and magazine production roles, and business development. In 2007, he developed and launched a mainstream-style green consumer magazine in the UK, called GreenerLiving, as a means of promoting sustainable change ‘within the system’. GreenerLiving closed during the post-crash recession, but Peter went on to become managing editor of the international ethical business title, Ethical Performance. However, Peter felt that the CSR sector has not succeeded in changing corporate priorities anywhere near fast enough, and so I decided to leave the treadmill of corporate employment and debt accumulation to focus on my own projects. Now poorer but a billion million times happier, he writes on political, economic and social issues – usually seriously, but sometimes as satire. He's currently writing Psychopath Economics, a book about the logic of social and economic power, belief systems, and the rise and fall of societies. Peter is convinced that ordinary people must educate themselves and exercise their economic leverage if we are to avoid social and environmental destruction.

peterbatt has 165 posts and counting.See all posts by peterbatt

%d bloggers like this: