Martin White
UK Shareholders Association (UKSA)
“To tackle vested interests, we must empower savers”. Face it – capitalism is in crisis. Somehow, the corporate world has got itself into a mess, where unjustifiable individual rewards often combine with a short-term focus that is harmful to society as a whole.
In practice, do we hear any discussion of what makes a company a fulfilling place to work in? And do we see any reversal of the situation around excessive pay and short-termism? The UK’s Kay Review diagnosed the problems pretty well, but the terms of reference did not open the way to radical suggestions for tackling them.
Society needs companies to:
- Meet customer needs efficiently;
- Look to long-term success as much as today’s profits – the signs that really matter are not easily measured, and not always understood either;
- Regard employee satisfaction, personal development and appropriate levels of empowerment as an important operating principle.
For the employees, the acid test is: what is the culture of the business really like to work in? Do people feel part of it, do they feel respected, are they comfortable that the business is ethical and fair to customers, and can they raise problems without fear of reprisal?
Hypocrisy in the establishment
Try raising the issue of executive pay and the impact of the bonus culture at any meeting of the great and good about corporate social responsibility! I find the question is ducked every time; the system, for all the corporate governance paraphernalia and people’s best intentions, is still fundamentally flawed.
Empower savers to care
Instead of “savers” I could have used the words “investors”, or even “ultimate shareholders”. The point is that, if you are saving for the future, the odds are that, one way or another, you are likely to be a part-owner of a large number of public companies. Engaging with, and empowering, ordinary savers is essential if we are to have a voice that counts.
Can we really tackle vested interests?
Yes, but ordinary savers may not have the knowledge or the time. This is about education, empowerment and someone to trust. The trick is that all the heavy lifting has to be done by financially knowledgeable volunteers who are independent of both the financial and corporate sectors.
Read more in the separate article “Savers Take Control”.