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How business responds to the Corona virus crisis matters hugely. It affects what happens to millions of lives and livelihoods now. And it affects the prospect for building back better. What we do now, will shape the pathway out of this mess. In years to come, suppliers and stakeholders will remember which businesses and brands acted responsibly during the crisis, working through problems together.
Here are 8 ideas on elements that are important right now for responsible business practice, despite highly-varied and fast changing contexts:
1. Even if the workforce is being downsized, rapid reactions should not come at the cost of worker rights and representation. Companies should ensure they are working with unions and other workers' representatives to explore and agree new ways of working. Beyond salaries, this is about ensuring sick pay, reducing uncertainty, facilitating care roles, smoothing income, clear communication, listening to what workers most need, and co-creating solutions.
2. The value of unpaid care and domestic work and the responsibilities people hold for looking after children, the sick, and elderly, has never been so self-evident. Businesses need to radically expand approaches to flexible working and support for carers e.g. agreed procedures for paid and unpaid time for care roles. These should be available and encouraged among male employees too – helping to shift the norms that leave caring and care roles largely to women. Oxfam's business briefing on unpaid care provides more insights into this topic.
3. Responsibility goes beyond the direct employees on a company’s payroll. Contractors and service providers in the gig economy are hit equally hard when businesses contract. It is welcome that Alan Jope, CEO of Unilever, made explicit mention that livelihoods of cleaners, security guards and other contractors, would be protected in his statement last week outlining Unilever commitments to the Coronavirus Response. Where income can't be maintained, contractors should have the paperwork they need to claim any government support, and ensure they retain the assets they need to build back later. Innovations to smooth cash flow include ‘selling forward’ - buying vouchers now for services supplied later.
4. Beyond the workforce, the entire value chain is exposed to major disruptions with those at the bottom of the chain most likely to feel the worst effects. How will shrimp farmers in Indonesia fare if diets in their export market shift to dried food not fresh, and garment factory workers in Bangladesh, if European clothes retailers remain closed for months? Deeper economic ramifications will emerge as isolation measures spread across the Global South, and the virus itself spreads among communities with poor health infrastructure and safety nets. Companies may be able to use use their existing networks in the value chains to share reliable information about the virus or support the distribution of soap and other necessary goods.
Companies relying on food and commodities need to already consider how smallholder farmers will fare if their movement is restricted or seed supply chains impeded, even if demand for their crops is strong. Firms higher up the value chain need to shift to thinking about resilience of the entire supply chain. This may mean many things but will include safer ways of organising logistics in preparation, production, and transport, and large amounts of credit to keep B2B sales flowing.
For small businesses and micro-entrepreneurs cash flow is vital. Where there are existing investments, loan repayments should be delayed. Where larger businesses are buying from smaller ones, they should adopt rapid payment terms or where they are selling to smaller retailers, they can extend credit (both of these are in the Unilever plan).
5. Women and men are experiencing the Coronavirus crisis differently. Women are taking the brunt of juggling family care and work, and are experiencing increased domestic violence. They may have more unavoidable contact with elderly and vulnerable family members. Women are often under-represented in trade unions and other formal leadership roles. The crisis risks exacerbating existing gender inequalities in the economy. Women with the most precarious livelihoods often differ to men in how they prioritise security of income versus income levels, so may have different preferences for coping mechanisms that business devise. All this means that listening to women workers and stakeholders, responding, co-creating solutions and investing in clear communication is critical.
6. Communicate, communicate, communicate - information flow and dialogue needs to go beyond the company itself, reaching wider stakeholders especially suppliers, with the purpose being to inform, not alarm, and finding joint solutions. Uncertainty about incomes and contracts can be crippling for suppliers. Traditional outreach work, such as extension support for farmers needs to adapt, with limited experience in SMS/tablet/online delivery being scaled up quickly. Companies with legitimacy and marketing assets can help put the lid on fake news, which is already exacerbating the health challenge.
7. Government support comes with responsibility. So far, Governments rushing to prevent business collapse have not had time to distinguish between the more or less 'worthy' companies, by behaviour or sector. But there was uproar in the UK as EasyJet paid a £171 mn shareholder dividend, just at the time it cancelled flights and called for Government support. Some companies have chosen, or been told, to put on hold shareholder payouts at this time. In the next phase of support, there is a strong case that companies that register for tax, treat workers fairly and sign-up to faster low carbon transition should get priority support for rebuilding.
8. ‘Armies’ of volunteers are springing up globally, while existing civil society organisations are under huge pressure with less funding and massive demand for their support. Wherever businesses are plugged into a community, they need to step in. Examples abound. Substantial donations to community funds; IT companies giving access to tools for free, or communications companies simplifying public health messaging. Businesses that don't have local networks to invest in, can give to global initiatives that focus on the most vulnerable.
This can be part of a structural shift in our economies, if we keep at it. The Coronavirus response has suddenly seen governments put health and wellbeing as the first priority, to be served by the economy. That is a major shift from focusing on GDP growth. It may seem harsh to think positively at all, but we must see the opportunity in this crisis, not to 'bounce back' but to ‘build forward’ to an economy without carbon, less consumption and travel, built around protected and secure workers, with investment in care services at its core, where social business serves all stakeholders. There is a lot more thinking to be done in coming weeks about how we build back better, laying foundations in our response now for an economy that drives wellbeing – a ‘human economy’.
Be among the first to receive an Action Toolkit focused on how businesses can protect the livelihoods of the most vulnerable workers in their value chains from the impacts of COVID-19, by signing up here.
Businesses that don't have local networks to invest in, can give to global initiatives that focus on the most vulnerable. Find out more about Oxfam's Coronavirus emergency appeal.
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