Image Credits: Luciano Lozano
By Bashman Adeshina
As mankind continues to battle the ravaging novel coronavirus and its debilitating consequences on the socio-economic landscapes of countries across the world, figures and trends from both the capital and labor markets seem to once again unearth the age long misgiving that the burgeoning shareholder-oriented capitalism is unfit for economic and social justice. Or what best describes a scenario where a select few are cruising to stupendous and limitless prosperity while a large chunk of the population are falling into austerity and bleak future.
In the US alone, the Institute for Policy Studies reported that billionaire’s wealth has skyrocketed amidst over 26 million jobs lost in March. The stories are not different in similar pro-shareholder capitalist societies. For instance, a Nigerian top tier commercial bank which posted gross earnings of 667 billion naira and declared generous dividends to its shareholders is contemplating sending over 75% of its workforce to the already saturated labor market with a staggering 23% unemployment rate.
It must be mentioned that the agitation for workers’ voice on the boards of corporations has no doubt undergone a chaotic history, from the early attempts to attain worker control through the instrumentality of industrial democracy and the subsequent adoption of political democracy cum management suasion to the contemporary renewed use of trade union powers.
In the global north, for example, the earliest industrial unions made frantic efforts to wrestle corporate power and American labor unions for instance began to call for worker’s voice and they used money in pension funds to make shareholder proposals.
As mankind races to return to normal, we should not be too optimistic that life returns to what it was before. This is because like never before, coronavirus has exposed the fragility in our society and the glaring flaws in shareholder capitalism. This pandemic surely gives the working people and trade unions the opportunity to interrogate the status quo and to act to enthrone a society that is fairer, more equal and more secure for all.
Historic statements were made in the early ’70s when unions put forward proposals at GM, Ford and other places for board seats and one union at Worcester Railroad was successful in getting an agreement for board representation. It was however regrettable that the passage of anti-union legislation and the continuous decline in union density eroded union power in the US and that definitely impacted the capability of workers to keep pushing for board seats.
The experience in the global south is hugely different because the contention seems to be narrowed to workers getting adequately compensated from corporate prosperity in forms of decent pay and other pecks with little traction for workers participation in the governance of the firms.
In all of this and throughout the different periods, some of the rhetoric advanced by proponents of the shareholder hegemony are largely theoretical and embedded in sheer legalism without adducing concrete reasons as to why workers cannot have a say in the board. But the truth is that in all of this, no one can disprove the fact that much of the wealth-generating capacity of most modern firms is based on the skills and knowledge of workers.
Furthermore, the shareholders-centric board should not enjoy legitimacy more than the workers inclusive corporate system in an economy where a large chunk of the money comes from pensions, life insurance and mutual funds of the workers.
Just like in the aftermath of the 2008 financial crunch on the global landscape, there is evidence suggesting that the Nordic countries which are synonymous with worker representation on the board are doing well both in terms of economic indices and effective management of the pandemic.
For example, the International Labour Organisation (ILO) undertook an assessment of COVID-19 impact on labor markets across the world and preliminary results indicate little or no significant impact on the labor markets of many of the Nordic countries. This is at variance with the appalling trends in many shareholder-centric countries.
As mankind races to return to normal, we should not be too optimistic that life returns to what it was before. This is because like never before, coronavirus has exposed the fragility in our society and the glaring flaws in shareholder capitalism. This pandemic surely gives the working people and trade unions the opportunity to interrogate the status quo and to act to enthrone a society that is fairer, more equal and more secure for all.
It is cheering that some discerning politicians across divides are proposing legislations that promote worker representation on boards of corporations but working people must not be complacent and we should not forget in a hurry how Theresa May’s obsession for worker voice at the campaign trails faded immediately she became the Prime Minister. The little progress made in the UK with respect to attaining employee participation on the board was attributable to the tireless agitation of trade unions and the Labour Party.
As it stands, the shareholder-oriented paradigm has demonstrated capability as an instrument for perpetrating wage theft therefore widening income equality. The unions must reinvent their strategies and demands; the era of bread and butter negotiation must give space to a more robust agitation on why workers must have a voice on the board. The assumed Iron Gate between labor and capital is no longer fashionable and workers must seize the ugly opportunity presented by COVID-19 to break the barrier and get seats on the boards.
This chance must not slip because it is either now or never!
Bashman is Senior Program Officer with the American Solidarity Center, Abuja.
