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THE NATION: EDITORIAL/Doing busines



Editorial & Opinion 

      EDITORIAL/Doing
      business without a
      conscience

      Business is business, politics is politics,
      and never the twain shall meet. Indeed,
      most investors would argue that business
      should not be mixed with politics. Are not
      Asia's economic troubles, they ask, the
      result of the hand-in-glove ties between big
      business and corrupt politicians which
      spawned ''crony'' capitalism? 

      There is, however, a growing consumer
      movement calling for businesses to
      recognise the political reality in which they
      operate and share the responsibility of
      protecting and promoting human rights with
      individuals and governments. Multinationals
      that have come under the pressure of this
      ''social responsibility'' movement include
      Levi Strauss and Nike. 

      In 1992 apparel-maker Levi Strauss
      withdrew from Burma, considered by the
      global community as a human-rights pariah
      state, because ''it was not possible to do
      business without directly supporting the
      military government and its pervasive
      human-rights violations'', and a year later
      the company began a phased withdrawal
      from making clothes in China after a panel
      of senior company executives found
      rampant problems of labour abuse by
      contractors and suppliers. Likewise
      shoemaker Nike has developed a ''code of
      conduct'' for its international business
      dealings and seeks to ensure that its
      sub-contractors in China, Indonesia and
      Vietnam follow the company's stance on
      wages and working conditions. 

      However, the announcement this month that
      Levi Strauss planned to go back to China
      and the lawsuit against Nike for ostensibly
      not sticking to its code of conduct have
      shown that such corporate responsibility is
      nothing more than a publicity stunt. 

      Indeed the decision by Levi Strauss to
      re-enter the lucrative Chinese market was
      not a major policy reversal. Levi Strauss
      never stopped making clothes in China: its
      Hong Kong subsidiary continues to
      manufacture clothes on contract at plants in
      neighbouring Guangdong province. 

      And last week Nike was slapped with a
      lawsuit for violating California's consumer
      laws by wilfully misleading the public about
      working conditions for the thousands of
      Asian labourers who help make its
      trademark footwear. Lawyers in filing the
      civil suit said that despite the campaign to
      promote itself as a model of corporate
      responsibility, Nike ignored the sweatshop
      conditions of the mostly young-women
      workforce working for its Asian
      sub-contractors. 

      For Nike this is the latest in a series of
      public-relations disasters after being
      caught covering up an auditor's report of a
      hazard-ridden factory in Vietnam some
      years ago. 

      The suit alleges that contrary to statements
      by Nike, Asian workers are regularly
      subject to physical punishment and sexual
      abuse. It says the workers are often
      exposed to dangerous chemicals, forced to
      work overtime, sometimes without pay, and
      are often unable to earn a living wage
      despite workdays that can be 14 hours
      long. 

      Like it or not, global capitalism has made it
      difficult for anyone to operate a business
      with a conscience. In theory ''constructive
      engagement'' by businesses can help
      improve working conditions and provide
      decent wages in countries multinationals
      invest in, but in practice cut-throat global
      competition means intense pressure to cut
      costs. 

      Indeed few companies want to have
      anything to do with human rights, and when
      they do, like Levi Strauss and Nike, they
      pay lip-service to corporate responsibility.
      Instead many have used the absence of
      ''corporate responsible'' competitors to
      penetrate new markets. Worse still, pariah
      companies such as the tobacco firms,
      which face increasing litigation problems at
      home, are peddling cigarettes to the
      ''replacement smokers'' in Asia, especially
      to teens. 

      This leaves consumers with the heavy
      responsibility of maintaining the pressure
      on socially irresponsible companies
      through awareness campaigns and
      boycotts, but most companies know that the
      global consumer movement is not strong
      enough to keep them on their toes. Levi
      Strauss and Nike may think they are being
      unfairly singled out for criticism. Indeed they
      are the tip of the iceberg, but it makes a
      start.