The Economist states that business should not be expected to live up to higher standards than government. “It too has to balance the practical with the moral and be aware of the balance changes. Any deal based on an outright law will come back to haunt you.”

 

Contrary to The Economist, many others believe that business should live up to higher standards than government. Often Western companies are being exposed for activities which, although they are totally legal, are challenged by self proclaimed gate keepers. The “Brent Spar” issue of Royal Shell is a well known example. Today, Dutch pension funds are said “to invest in Libyan weapons”. Research concludes that these pension funds invest in companies that have sold weapons to Libya. For all truly interested, the link is rather indirect. Moreover, the fact that Western companies need Western government permits to export these arms seems not to be relevant. Even members of parliament, who are the legislative power, express their discontent about these pension funds in public.

 

Now weapons are a pretty straightforward issue. You wouldn’t want to be involved in this trade at all, but it serves well as an example of apparent higher standards for business than Western governments. International diplomacy aimed at serving the self interest of a country with a democratic government is allowed to do what business serving its own interests can’t.

 

This weekend the chairman of the Board of Burma Center Netherlands writes in The Financieele Dagblad that the EU should investigate what the impact of trade sanctions is and whether it wouldn’t be better to allow sustainable investments that would benefit the Burmese population. This initiative follows a call by the democratic opposition of Burma. Until recently companies that invested in Burma where exposed for their apparent wrong-doings. Now it turns out that (in this case?) not doing business with a dictatorship is not the solution either. Didn’t this same Center back the sanctions in the recent past? Who do they represent? How can they be sure that their previous decision was well balanced? And why should we follow them now? How can business know what is wise?

 

The position of companies in a globalised economy is very complex, to say the least. Despite operating within the boundaries of Western legislation they face the scrutiny of all kinds of groups and individuals.For activists it is easier to expose businesses to make their point than exposing Western, democratically elected governments. Self proclaimed gate keepers should appreciate their responsibilities. So should business. Simply stating that business should not live up to higher standards than governments is not good enough. No business can ultimately afford this attitude. Sometimes it is very wise to choose not to do business in certain countries, however it can also be wrong to exclude suppressed populations from the global economy. There is no blueprint here: knowing what you stand for, following your moral compass, and an active dialogue with society are crucial for long-term success. This is as true for business as for other organisations.