Modern unionisation for freelancers, the legal duties of US corporations and how business can approach climate change
Breaking out of cubicle land
We live in the free agent age. Nobody born after, say, 1980, seriously aspires to be a cubicle monkey. Or, as the Urban Dictionary has it, someone who “works from nine to five doing God-knows-what under fluorescent lights”. But many do. Why? Because with the cubicle comes guaranteed benefits, steady employment and regular pay.
This fascinating short paper by Harvard senior fellow Amy Wilkinson shows how an innovative trade union is turning around the precariousness of the average freelancer. The Freelancers Union provides self-employed workers with health insurance, retirement plans, community events and political representation.
Yet the Brooklyn-based non-profit group operates in a way quite dissimilar from the traditional workers’ union. It doesn’t organise strikes. Nor does it negotiate pay increases for its members. Most surprisingly, it doesn’t charge. Most of its revenue comes through services to members. The trick is to use the bargaining muscle of its 115,000 members to gain lower premiums, Wilkinson argues.
As might be expected from an organisation of freelancers, the union has become adept at maximising the networking opportunities of the internet. Through the union website, workers can find everyone from copywriters and legal advisers to accountants and opportunities. They can also orchestrate online and offline meetings, launch online advocacy campaigns and hold niche discussions about relevant topics. An inspiration perhaps for those trapped in the cubicle farm?
“The Entrepreneurial Union: How the Freelancers Union is modernising the labour movement for independent workers” by Amy Wilkinson, Stanford Innovation Review, Autumn 2009.
A modern American mandate
“This crisis has reminded us that without a watchful eye, the market can spin out of control. The nation cannot prosper long when it favours only the prosperous … What is required of us now is a new era of responsibility.”
So ran the inaugural address of the 44th president of the United States. Barack Obama called on his fellow Americans to “seize gladly” their “duties” to the US and the world. The speech was widely lauded, but business academics have begun to break down the rhetoric and ask what legal duties US corporations have to wider society.
Since the 1930s, the shareholder primacy rule has governed corporate America. That’s to say, companies are required to account for their stockholders’ interests, and no more. This has gradually begun to change, with companies taking on roles similar to “state-actors”, the paper shows. The current financial crisis has sped up that process. Congress could feasibly begin to apply constitutional norms for private actors to the commercial sphere, effectively forcing social obligations onto corporations. Furthermore, recent interpretations of the foreign commerce clause could see federal courts holding US companies to account for their actions overseas.
The paper concludes with a call for corporate social responsibility standards for corporate boards. These should set out a “new transcendent path” to take into account changing expectations for business. Such a path must be “proportional”, accommodating the “pragmatic reality” of broader social concerns alongside traditional shareholder considerations. In summary, this paper serves as a welcome defence of the need for responsible business as both a social buffer and economic catalyst in times of recession.
“A New Era of Responsibility: a modern American mandate for corporate social responsibility” by Janet Kerr, Pepperdine University, working paper, November 2009.
Adapting to adaptation
Every business sector is set to be affected by climate change, but not all in equal measure or in equal fashion. That central observation inspired the Network for Business Sustainability to assess 200 separate studies on how different industries are responding to the challenge of adaptation. Varied, the prognosis reads.
Out in front is the insurance sector, in terms of factoring climate change into its risk assessment models. Topping the awareness charts are the agriculture and tourism sectors, two industries set to be hit severely by shifting temperature patterns. The research throws up some interesting trends. The energy sector, for example, is adopting a more proactive approach than might be thought. Its adaptation strategies focus on technological innovation, new infrastructure such as power grid capacity and behavioural strategies like energy efficiency.
In an attempt at application, the paper makes several recommendations for managers. Chief of these is the need to collaborate at a sector level, especially with a view to sharing knowledge with laggards. Working across sectors, including with academics, to design novel solutions also makes the list. As for researchers, sector-specific adaptation measures need to be developed, the authors conclude. Particular focus on vulnerable sectors such as water is also required.
This short, fact-packed paper is one of four covering different aspect of the adaptation debate and corporate responses to it.
“Business Adaptation to Climate Change: A Systematic Review” by the Network for Business Sustainability Knowledge Project Series, November 2009.
On campus
Seven out of ten business schools surveyed by the Aspen Institute require students to take a course on business and society, up from a third in 2001. The findings form part of the latest biannual Beyond Grey Pinstripes survey, based on 149 business schools in 24 countries. See www.beyondgreypinstripes.org.
Chemical company Dow is to sponsor a chair in sustainable chemistry at the University of California, Berkeley. Chemical engineering Professor Alexis Bell will be the first to fill the position. See www.spsp.berkeley.edu.