Leanda Lee
During the 1997 Asian Financial Crisis, multinationals in Asia who maintained their support for local communities and workers were the ones equipped to ride out the crisis. Their strength and resilience lay in making difficult decisions together with their workers, maintaining some level of livelihood and operations. Workers agreed on arrangements to cut back hours as business revenues declined, helping to extend job security. Those who could prioritized colleagues in greater need. Some took voluntary early retirement. Available resources were shared to help everyone see out the crisis. This is what would now be recognised as corporate sustainability; keeping businesses and communities sustained for as long as possible.
These corporate actions were acknowledged by local communities, governments and finance providers, so upon recovery, when assistance became available, resources and finances were to be allocated, and purchase contracts issued again, these companies were close to the front of the line because they had proven their dedication and commitment to their host nations.
In Macau, we are currently experiencing profound insecurities, loss of freedom of movement, panic and life-changing effects brought by the coronavirus. Companies are letting people go, cutting their hours, strongly encouraging people to take annual leave or leave without pay.
These may be natural consequences of the extraordinary events that have drastically reduced the visitor numbers our economy relies upon. I refer not just to the casinos but all the smaller enterprises that depend to some extent on their interconnectedness with tourism and anything that trickles down from that: advertising, printing, cafes, wine merchants, produce suppliers, mechanics, transportation. Even indirectly, what activity in our peculiar community doesn’t rely in some way on a vibrant tourism sector? And, behind each activity there are individuals and families.
We expect to share the burdens, but the speed with which some workers have been summarily laid off and domestic helpers let go is questionable. In crises, reverting to self-preservation mode is natural, even for companies. Here in Macau, however, many have benefitted greatly from lengthy periods of prosperity. Now is when we should share what we have with those who are in less fortunate positions. It is not a time to hoard or kick out, it is a time to distribute and help each other through.
People and institutions change in times of crises. Indeed, crises can be harnessed to effect change when ordinarily vested interests would impede it.
The coronavirus is one of many big issues the world is currently grappling with: Climate Emergency, future of work, inequality, erosion of trust in institutions and leadership. If within these crises, businesses focus on their profitability and merely batten down, we all lose out on the ingenuity, skills, knowhow and capital that businesses can bring to help address our problems.
A new wave of intellectual thinking has been driven by the existential crises we are facing. It is a development, in a way evocative of the 1960s that gave us the shareholder primacy of Milton Friedman, the one that told us the nature of business was to make profit. It has not always been, nor will always be so.
The new wave believes corporations to be a critical mechanism to bring about effective change, enhancing social wellbeing and environmental recovery and stewardship. The role of purposeful companies is thus to solve problems and to do so profitably over time.
Economist Tim Jackson in his book “Prosperity Without Growth” similarly suggests enterprise as service. In the words of Professor Colin Mayer of the Said Business School, Oxford University, “the purpose of business is to produce profitable solutions for the problems of people and the planet, and not to profit from producing problems for people or planet.”
Should Macau ever establish a securities market, business response to our virus crisis will give us something to reflect on when the time comes to determine the laws that will govern the nature of business. Let it be purposeful.
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