Advertisement
Climate change
OpinionLetters

Letters | If capitalism wants to match the ‘reboot’ rhetoric, it must become transparent

  • Calls to ‘reboot’ capitalism, and the new Business Roundtable pledge, are both welcome and necessary
  • But only with universal and high-quality disclosure can words be turned into actions

Reading Time:2 minutes
Why you can trust SCMP
Activists stage a protest against the backdrop of a mock tropical island beach representing a tax haven, outside a meeting of European Union finance ministers in Brussels, Belgium, in December 2017. Improved corporate disclosures include recognising the sustainability impacts and relevance of issues such as tax payments. Photo: Reuters
Letters
David Dodwell’s article, “Capitalism is in crisis. It cannot be business as usual for very much longer” (September 23), put forward that capitalism needs a “painful reset” to change focus from economic growth to improving livelihoods.
Advertisement
This followed an editorial in the Financial Times in August on why major companies have committed to “explicitly elevating broader interests such as those of employees, the environment and customers” by redefining corporate purpose beyond profit.

These are progressive – and in my view long overdue – perspectives on responsible business. What they articulate is not only welcome but much needed, as we are already seeing cracks in the foundations of capitalism. The real question now is, what will change?

For the rhetoric of the new Business Roundtable pledge signed by 181 CEOs – to “lead their companies for the benefit of all stakeholders” rather than only shareholders – to become reality, more companies must join in a global effort to reboot capitalism. A starting point is full transparency. Like financial statements, companies must publicly state their impacts on people and on the planet. Without full transparency, we cannot align capital to sustainable business practices nor hold companies accountable.
Most major companies – such as those in the Business Roundtable – disclose their sustainability impacts. Indeed, 93 per cent of the top 250 global companies by revenue report on sustainability, of which three quarters use the Global Reporting Initiative (GRI) framework.

Yet, with the acute problems faced by the world, we need more and better reporting of impacts, from all businesses. Only with universal and high-quality disclosure will we be able to turn words into actions.

Advertisement