COMMENT: With Covid exacerbating poverty and trade inequality, many more companies should join the likes of SSE, Co-op, and Lush in adopting the Fair Tax Mark, says Ashden CEO Harriet Lamb
I haven’t had Covid-19. But those who have say that it goes straight for your body’s weaknesses. Got a bad back? That will ache. Prone to headaches? Expect agony. In the same way, across society writ large, the virus has attacked our vulnerabilities. It has found society’s inequalities – and deepened them.
Over recent decades, yawning gaps have opened. As Oxfam calculated in its latest catchy factoid: the increase in the wealth of just 10 billionaires since the pandemic began would be enough to prevent everyone in the world falling into poverty because of Covid and pay for vaccines for all. You have to read that a few times for its enormity to sink in.
This can, in part, be traced back to the glory years of global deregulation and liberalisation, which opened spaces for companies to expand globally. Our laws, our multilateral agreements, our taxes have simply fallen further and further behind the nimble globe-trotting companies, who skip between countries, evading tax at every turn. At times this has sparked outbursts of anger, provoking people to take to the streets, banners waving, demanding fairer tax regimes.
The Fair Tax Mark was founded to acknowledge those companies that open their books with full transparency and meet ethical standards on tax
Into this gap have stepped some brave, pioneering companies that are ready to fly the flag for fair tax. That is why the Fair Tax Mark was founded in February 2014: to acknowledge those companies that are ready to put their head above the parapet, open their books with full transparency and meet ethical standards on tax.
It’s a strategy for societal change that has always appealed to me. Two decades ago, I got involved with Fairtrade because I saw it as creating the living alternative, showing through a bubble within global trade that it was possible to pay a fair price to farmers and workers and still succeed commercially. It’s why I now work at the climate change charity Ashden, showcasing the positive solutions to the climate crisis, highlighting the ethically run businesses driving the low-carbon transition – such as e-cargobikes.com, which delivers your shopping on electric bikes, the riders paid the London living wage.
In the same way, the Fair Tax Mark seeks to reward those companies who are leading the pack. It’s not easy. Let’s face it, for most people most of the time, tax is not exactly cutting-edge-sexy. Most of us don’t really understand it and certainly cannot hope to know what companies are doing with their tax returns. That is why we need an organisation like the Fair Tax Mark, experts who have worked out how to trawl through company accounts and assess whether companies are playing fair.
The good news is that the list of companies ready to be subject themselves to this scrutiny is growing. For five years, SSE plc was the only FTSE 100 company on the Fair Tax Mark website. Rachel McEwen – who is also a trustee – laughs that the company didn’t appreciate how big a step it was and SSE has never regretted the move.
For her, it’s simple: companies should pay their taxes so that governments can support all the services on which we all depend, from education to the health service. Now there are 60 companies on the list – from Scottish Water and Energy4All, to high-street brands Timpson and Lush, and small, employee-owned businesses such as Jerba Campervans. The Pensions and Lifetime Savings Association, which represents pension schemes that provide a retirement to 20 million savers in the UK, was recently awarded the Fair Tax Mark.
Even more exciting, companies across Europe are getting in touch, keen to be involved. That is why the Fair Tax Mark is expanding globally too, developing new standards to take account of different countries’ situations. And that is why they asked me to get involved. They are proud to be copying every successful tactic of the Fairtrade movement and hope that I can share some of our best ideas. So I am proud to be joining the board of the Fair Tax Mark.
I wonder if the gap is opening ever wider between companies that are leading the way and those whose business models are fundamentally damaging
We know society is becoming more divided. I also wonder if the gap is opening ever wider between companies that are leading the way – by paying fair taxes and fair wages, driving the low-carbon transition while doing justice to those left behind – and those whose business models are fundamentally extractive and damaging by paying low wages and low prices to farmers, and who avoid taxes by shifting money between subsidiaries.
That is why it is more important than ever to distinguish between ethical champions and the rest, guided by initiatives like Fairtrade, Fair Tax Mark, and the Ashden Awards.
Harriet Lamb is chief executive officer of Ashden, which is seeking applications from low carbon innovators around the world for its 2021 Ashden Awards. Deadlines are 3-17 March depending on the award. Enter 2021 Awards – Ashden
Covid-19 social inquality Fair Tax Mark Fairtrade Ashden SSE