NEWS

Tuesday, 11 April 2017

MRC Executive Director Nick Cater writes in The Australian:

Let’s hope the signatories to the letter from corporate Australia demanding changes to the Marriage Act feel better for getting the matter off their chests.

The thrill of virtue is the only reward the 20 chief executives can expect for their troubles.

They may think discerning consumers “are selecting products from companies that better represent their values”, as they wrote in their letter. They may yet confound sceptical shareholders with a spike in profits in reaction to their principled stand.

Somehow it looks unlikely. They have failed to win over the Prime Minister, who wisely rejected their invitation to burn his finite political capital by breaking an election commitment to a plebiscite. They have failed to move the broader public, which is becoming increasingly irritated by well-paid people who dress in expensive suits presuming to tell them what they should think.

What were these captains of corporate Australia imagining as they gazed down from the opulence of the executive floor and concluded they, of all people, could break the impasse in this protracted moral debate?

Their self-regard appears to be as bloated as their salaries. Corporate chief executives are among the least trusted members of Australian society.

Their credibility has fallen to their lowest level according to the 2017 Edelman Trust Barometer, an international opinion survey that has been running 17 years. Last year 39 per cent of respondents viewed Australian chief executives as extremely or very credible; this year just 26 per cent think so. Trust in boards of directors has dropped from 34 per cent to 24 per cent on the same index. Only 48 per cent felt they could trust business to do what is right, a fall of 4 per cent.

Corporate Australia breathes the same rarefied air as the media and political classes, who increasingly are viewed as an uncaring, unfeeling, arrogant elite. Trust in government has fallen eight points in a year to 37 per cent. Trust in the Australian media has fallen 10 points to 32 per cent, one point higher than in Russia but more than 10 points behind Colombia, Mexico and the United Arab Emirates.

The lesson for the corporate, political and media classes alike is that the things that energise the Twittersphere seldom excite the rest of Australia. Big business will not close the trust gap by painting its brands in rainbow colours. When respondents are asked why they don’t trust business, the lack of a comprehensive inclusion and diversity policy or insufficient awareness of the wellness of its employees does not feature.

Their concerns are immediate and practical rather than abstract and symbolic. International tax avoidance tops the list, followed by executive pay and the relocation of jobs offshore.

The longer these concerns remain unaddressed, the deeper public irritation grows. The last thing business should be doing is rubbing salt in the wound by siding with campaigners who despise their fellow Australians and are prepared to go to any lengths to bring the wretched masses into line.

Those who start buying into the progressive mantra find it difficult to stop. There are no half measures in the proclamation of virtue, it comes as a package. You cannot be truly sincere about same-sex marriage in the eyes of the pure without demonstrating compassion for refugees and the gender fluid, sign up for every boondoggle diversity program that comes across your desk, and pledge to divest your interests in unfashionable industry sectors.

Moral crusaders are hardly the kind of friends the business sector needs when the pressure from anti-corporate forces is making it harder for enterprise to flourish.

Regulation and the compliance obligations that the crusaders favour reduce international competitiveness and place a disproportionate burden on small and medium-sized enterprises that lack bureaucracies large enough to cope.

If you value all your customers, not just the 10 per cent who Twitter, it would be sensible to stay clear of this stuff. Running a profitable business that invests in jobs, pays its taxes and provides quality goods and services at a competitive price remains the biggest contribution a chief executive can make to society.

Yet executives and boards find it hard to resist the lure of corporate social responsibility and the vindictive campaigns launched on companies that fail to comply.

The persecution of Coopers Brewery for allowing its name to be associated with a civil for-and-against debate on changing the Marriage Act between two Liberal backbenchers, and the targeting of IBM managing partner Mark Allaby by LGBTI activists because of his association with the Australian Christian Lobby should make a line in the sand.

The late Bill Leak’s portrayal of LGBTI activists as rainbow-coloured storm troopers was an appropriate metaphor for the illiberal and undemocratic methods the crusaders are prepared to use to bludgeon corporate Australia into submission.

Corporate Australia should be under no illusion; it is impossible to cosy up to such causes without widening the credibility gap with broader-minded citizens. One of the many long debates between Leak and his friends left incomplete by his untimely death was over which literary adjective was better suited to describe the belligerence of the enforcers of political correctness.

Was it Kafkaesque, the tyranny of petty bureaucrats portrayed in Franz Kafka’s The Trial, who are granted not just extrajudicial authority but, worse still, the discretion as to how it should be applied?

Or was it the Orwellian world of George Orwell’s Nineteen Eighty-Four, in which a totalitarian regime dictates not just what is said but what its people think? Administrative overreach or totalitarian enforcement?

One thing is certain. If the first is not resisted, the second will inevitably follow.

 

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2019 by Menzies Research Centre