English: Bluefin tuna. (Photo credit: Wikipedia)

‘Canning Paradise’ is a 90 minute documentary primarily about the commercial tuna fishing industry being established near the town of Madang in Papua New Guinea, but also more generally about the globalised economy rubbing up against traditional ways of life.

Papua New Guinea recognises traditional land ownership in its Constitution, which is fortunate for traditional villagers as they rarely have formally recognised land titles. This provision makes it difficult for the  Government to appropriate land for development. The film also explores the benefit this has had in preventing PNG from becoming a peasant economy.

The village of Madang is a little different because it was formerly a Catholic mission. A court case found that the Catholic Church owned the village’s land and its surroundings, which it on-sold to the Provincial Government in 1991. The Government has decided to open it for development by establishing a so-called Pacific Marine Industrial Zone (PMIZ). This sounds like it is an export processing zone (EPZ) but it isn’t, it’s a title only, no special laws have been passed to exempt companies in the area from normal laws, which is what happens in EPZs.

The Philippino canning company RD Tuna have set up in the area with a number of fishing vessels. Under the deal, the PNG Government receives only 2-8% of the profits in royalties, which amounts to about $50 million. The tuna ends up in one of RD Tuna’s three brands: Diana, Dolly and Dolores.

The PMIZ has numerous issues, for example its rusty vessels do not meet environmental standards which PNG does not have the resources to police effectively.

RD Tuna also mostly employs flown-in Philippino workers rather than locals. Both the company and the Government support the in-house, company-friendly union. When 500 of the Papuan workers went on strike in 2010 over low wages, wage theft and freedom of association, most of them were sooner or later terminated. It seems that the people of Madang are not destined to share in the bounty being extracted right off their shores.

‘Canning Paradise’ is a well made film: not in the sense of being slick, but in the sense of being true to its subject. It conveys the complexity of this issue in depth, resisting the temptation to propose quick solutions. The interviewees were unanimously of the view that a traditional economy has a value even if it can’t be readily expressed in dollars, but beyond that there was no sense at all of a clear way forward. I guess that’s reality: few problems are capable of having straighforward, elegant solutions like you will see proposed in a 4-minute TED talk.

The DVD is available from Ronin Films.

*Postscript: This is the 150th post on fairforall.org. The site recently received it’s 15,000th visit – thanks for your support!

Related posts:

• Where’d that shrimp come from? 13 January 2011
• The Pleasures and Sorrows of Work 25 February 2011 – includes link to a great photo esssay, The Journey of Tuna
• Escalation of Commitment 29 September 2011 – re the OK Tedi mine, also in Papua New Guinea
• $2 an hour to work on an inhospitable mountain peak 27 September 2011 – re the Grasberg mine on the Western, Indonesian, side of New Guinea

Olympus E-PM2 with Tokina 80-400mm (Photo credit: hto2008)

I was really looking forward to reading ‘Exposure: Inside the Olympus Scandal‘. Perhaps unfortunately it has parallels to the fictional ‘Rising Sun‘ so I was hoping for a similarly dramatic story of moral uprightness in the face of wrongdoing. Maybe some readers found that to be the case, but as I worked through the book I thought the ethics of the situation became murkier.

In brief: Briton Michael Woodford was made President of Olympus in 2011. Just a few months into the job he became aware of an accounting fraud when it was leaked to independent magazine Facta by an anonymous employee. He tells his executives to investigate it but gets stonewalled and, when he pushes the issue, the board dismisses him.

The fraud in question was a loss incurred all the way back in the late 1980s during Japan’s property slump, when an investment turned sour. Company insiders had kept it out of the accounts all that time before deciding to realise the loss in 2008 by purchasing a phoney company and counting the $700 million debt as an ‘advisory fee’. Woodford wryly comments that, had it been real, it would have been the largest advisory fee in history.

But that’s as far as the scandal goes. There’s no hidden agenda, no underworld involvement, not even any personal enrichment arising from these shenanigans. The perpetrators were motivated purely by the desire to protect their own company. A victimless crime then? Not exactly; the shareholders were clearly being misled, however massaging of ugly facts is so commonplace in Japan that it’s difficult to call it wrongdoing (see earlier post about laws vs norms). The Economist described the Olympus affair as “not so much a scandal as a state of mind”.

Is it just a simple clash of Anglo American vs Japanese values? Woodford didn’t think so. He argues forcefully while at Olympus (and again in his book) that such practices are rotten and need to change. Japan’s closed-rank corporate culture, he says, did wonders for the country in the postwar era but now that those companies have grown up they need to be able to adapt to changing circumstances. Unquestioning deference does not allow people to take the necessary risks to fight off competitors, notably including those in next-door Korea. Woodford passionately wants Olympus to succeed but sees its own corporate culture as its biggest challenge. How much impact his actions will have in the long term remains to be seen.

Here he is talking about his experience on Australian television:

Shareholder value versus value to other stakeholders

On the narrower question of the fraud itself, I can empathise with the unknown people who were trying to correct the damage. They remind me of the hapless crew of the Battleship Yamato who continued to man the guns even when the ship’s fate was sealed. Woodford comes from an Anglo-American perspective of shareholder capitalism. In his view the profitability of the company is the number one value. The Japanese, on the other hand, see the company in a more embedded fashion: it exists in a web of relationships including the other members of its keiretsu conglomerate, suppliers, customers, employees and factory towns. It sounds noble to make the company face the music, but what effect does it have on the ongoing wellbeing of all those stakeholders? (If that sounds touchy-feely, don’t laugh; the U.S. Government used exactly these justifications to rescue both the financial industry and General Motors)

Faced with such ludicrously high responsibility, it’s not hard to see why the poor devils working in Olympus’s back offices opted to delay the day of reckoning. I’m not saying it was the right call, just that it’s understandable with the pressure they would have felt.

Harvard Business Review ran an article last month titled ‘Long CEO Tenure Can Hurt Performance’. It compared the stock return of several companies against the length of tenure of their CEO and, sure enough, the short-term CEOs saw the greatest rise in stock price. What was omitted was whether the companies stock prices performed better after the CEO in question departed; not as well, I suspect. However that is a tactical argument. The real point is that bundled into the article is the Anglo-American assumption that the share price is the measure of a company’s worth, and what it accomplishes in the real world is only an adjunct to this. I’m not convinced.

See also:

• Corporate governance in Japan The Economist, 29 May 2008

Related posts:

• Culture’s Consequences (Part 3): Individualism 17 November 2012
• Company execs are usually rewarded for driving down wages 5 June 2011
• An economy for people, not vice-versa 14 February 2012
• Film review: Ningen no Joken, Episode 1 22 January 2013

“Sweatshop” (www.playsweatshop.com) is a game produced by Britain’s Channel 4, in which people learn how sweatshops work by acting in the role of a factory manager. It gained extra press coverage by being de-listed by Apple from their App Store a couple of days ago. It is probably better considered as a game about ethics, as you experience the conflicting demands on the manager, than a game that encourages activism. I’m not sure how many people would want to take on the role of the oppressor. No doubt they thought about this during development, it must have seemed difficult to make a sweatshop employee the protagonist. Which brings us to the second game…

“Half the Sky” (www.facebook.com/HalftheGame) – a game in which the player takes on the personna of a rural woman working her way towards empowerment, which is a much more appealing plot line. As an added feature, playing the game raises real-life dollars for seven partner development organisations. Cute huh?

Law School (Photo credit: Tulane Public Relations)

A little over a week ago, the Australian Council of Trade Unions released recommendations for unions to improve their internal governance, primarily in the area of finances. The panel was announced at last year’s tri-ennial Congress as a response to allegations of misuse of union funds at one particular union.

It should be noted that the people involved in this incident have since been charged with fraud so there is no deficiency of regulation. The recommendations propose tightening-up of internal procedures so that it is more difficult for this kind of conduct to take place unseen.

This got me thinking again about the difference between regulatory compliance and ethics.

All laws have the effect of categorising human behaviour as acceptable or unacceptable. The problem is, the real world does not lend itself to tidy distinctions, so laws become more complicated as they define exceptions and then define exceptions to exceptions. Moreover, this process doesn’t take place in a vacuum; as soon as you proscribe one form of misconduct, another will spring up in its place. You could call this the ‘Hydra Effect’.

It’s worth asking what effect, if any, does legislative redress have on people’s sense of right and wrong?

I don’t think there is a hard and fast answer to this but can see three interpretations:

1. It sends the message that society disapproves of the conduct and thus the law has a normative effect. This may be true in some areas -notably criminal law- but it seems a little naive to believe that law and morality could be so closely correlated in an era when the laws of the state run to thousands of pages. I once attended a defensive driving course where there was a free-for-all discussion about what were the correct road rules in certain situations – everyone was just guessing! (We know what drivers really do when faced with such ambiguous situations: they don’t consult the rule book, they simply fall back on politeness and decide who will give way using hand signals)
2. Legislation could in some situations have the perverse effect of lowering standards. Take financial regulation for example: most people involved with finances are behaving honestly at the outset. Then, in response to the actions of a few individuals, the law steps in to set a certain benchmark. That benchmark will most likely be lower than people’s personal standards, as it sets only a minimum standard of behaviour. The normative effect of the law makes them ask themselves, ‘Why should I bother? Here is a clear signal that I don’t need to take as much care as I have been’. How many times have you heard someone say, defensively “But we were acting within the law”? Mandatory CSR targets fall into this category, e.g. carbon emissions treaties and ‘Fair Trade’ standards (see earlier post).
3. You could attempt to sidestep this dilemma by taking a position that law-makers oughtn’t be interested at all in whether or not the law has a normative effect on people, they should simply see it in an instrumental fashion designed to bring about a particular result – or, even more cynically, see it as a way of reacting to public opinion. You might call this the ‘checks and balances’ view. Immigration laws are an example. Stock exchange rules are another: their purpose is simply to avoid certain outcomes and the moral status of human actors involved becomes irrelevant. This view has its place (see post) but if you apply it universally, you will end up ascribing unrealistic levels of responsibility to Governments, as if their mere fiat alone is sufficient to determine what people do in the real world. Or, if you admit that they can’t, then you’d have to advocate allowing individuals completely to follow their own moral lights. That is basically an optimist’s vision of the law of the jungle.

This leaves us between a rock and a hard place. Yes, laws do carry a normative effect but you can’t rely on that alone.

There was a book by Jim Collins a few years back that advocated the use of “Stop Doing” lists. The idea is that more work will always find its way to you, creating the need for an ever-lengthening “To Do” list; so, to be able to stay on top of things you need to discipline yourself to make a list of what you need to stop doing to free up the necessary time.

Legislators and pressure groups, take heed: more law isn’t always the solution. It might help, but of itself it won’t be enough to bring about the intended change.

Related posts:

• The difference between compliance and ethics 31 July 2011
• What if there really is no villain? 29 December 2011
• Electronic trading’s ethical vacuum 30 August 2012

Girls’ Generation endorse an LG handset.

Almost a year ago I first encountered ‘K pop’ (and that was before Gangnam Style I might add) and my musical taste has never quite recovered. I should have known it was too good to be true that these extremely high quality production music videos could be getting made without someone paying the piper.

It all seems like harmless fun: the K pop idols come across as being more hard-working and modest than many of their North American counterparts. The whole phenomenon seemed to be emblematic of a newly confident 21st Century Asia. Still does.

Then as I was walking through Sydney’s World Square I noticed a familiar face in a shop that sells beauty products: Yoona from the group Girls’ Generation. Curious, I wondered what other products the group has endorsed.

Well, it turns out that Girls Generation, collectively, are rated as Korea’s single most influential product pushers.  Their list of endorsements is so extensive it has its own Wikipedia page and includes Samsung, Hyundai and Philips Van Heusen, all of whom have current labour and/or environmental controversies.

These nine sirens work very, very hard at persuading people to buy stuff, without asking too many questions about where it comes from or how it is made. They, or at least their label, SMTown, are getting paid a lot to do so.

K pop stars, you see, aren’t struggling artists trying to break through the clutter. They are employees, completely owned by their record labels who find, package and then promote them relentlessly. They sign on in their teens to fifteen-year contracts. The music is all written by other people and put in front of them to sing. Their employer has the power to decide everything from what they eat to who they can date (typically no one! … sorry fellas) I’m sure they get no say over their brand endorsements either. Faust-like, they barter away their right to object when they signed on with the label. Korea has such a culture of conformity that it’s difficult to imagine a lone objector anyway.

The performers are themselves in need of better protection of their rights. Four members of another girl group, KARA, recently tried to sue their label, asserting that their contract was unfair. Essentially it made them carry the risk of poor sales and in one year each of the performers were paid just $10,000.

South Korea’s corporate hegemony could be the closest thing we can see in real life to Huxley’s Brave New World, a place where everyone cheerfully keeps the wheels of production turning without daring to ask questions. Just keep buying those cellphones and televisions thanks very much.

This is the dystopian ‘Neo Seoul’ from the film Cloud Atlas. It’s hard to pick the difference

Evil masterminds?

So when you want to point the finger, who is it that is responsible? Does the buck really stop with a handful of charming but ethically undiscriminating young ladies? Not really. The K pop idols are only so popular because of dupes who are suckered in by all the colour and movement, and all I can say is “Touchez”.

We have met the enemy, and he is us ~Walt Kelly

* Al Jazeera also looked at this issue of ‘Who’s to blame?’ only a week ago. Here is the segment:

Related posts:

• Book Review: Consumer Republic 26 December 2011
• Samsung Galaxy: Made by Humans 10 July 2012

3D TV static (Photo credit: Wikipedia)

The early advocates of universal literacy and a free press … did not foresee what in fact has happened, above all in our Western capitalist democracies – the development of a vast mass communications industry, concerned in the main neither with the true nor the false, but with the unreal, the more or less totally irrelevant. In a word, they failed to take into account man’s almost infinite appetite for distractions.

-Aldous Huxley, Brave New World Revisited (1958)

I was thinking more about the “Boomerang” theory of activism, which relies on getting results through media embarassment (see earlier post).

If you think about it, it’s inherently limited.

Realistically there is only so much airtime that the media is going to give to labour issues. Have a look at this infographic to see what I mean. Labour rights stories rarely make glamorous news, unless they are tragic.

There’s only space for one labour rights story at any given time. A few weeks ago it was Foxconn. Before that it was the Bangladesh factory fire. Before that it was the Pakistan factory fire. These factories represent a drop in the ocean. It just underscores the difficulty of ‘scaling up’ advances in labour rights.

Maverick social critic Ivan Illich was on to this decades ago. He asked people to take a hard look in the mirror: What is it that you are trying to accomplish? Do you want to “fix” things permanently? Why? He called this the ‘soft underbelly’ of delusions of power.

Institutions of public health and education are, he said, the empty husks of the formerly Christian values of Western society, trying to make things better but no longer wanting to make any personal contact with their beneficiaries. I suspect that he would include labour regulations on that list.

I visibly encountered what he meant when I visited an aboriginal settlement in Australia’s Northern Territory some years ago. The largest building in town was the “CDEP” shed (the acronym stands for Community Development Employment Projects). It contained every imaginable kind of building or farming tool, up to and including articulated motorised diggers. It was all provided free by the Australian Government in a kind of guilty reparation for taking the aborigines’ land without compensation all those years ago. And it was all sitting there unused. People don’t put a value on free gifts.

You can pay people to work, but you can’t pay them to care

Similarly if labour advances are brought about by distant organisations that are not in touch with the beneficiaries, then who are they really for? The results will inevitably evaporate as they are not used. Advances won by public relations and legal means do not, on their own, represent a victory; the victory is the winning of respect.

The workers who’ve migrated from rural areas to manufacturing districts aren’t doing it so they can have lives filled with ‘things’, they just want to contribute to their families and gain dignity and respect along the way. When I glance around the train carriage, though, and see the number of people looking at their little glowing screens I sometimes wonder who is free and who is enslaved.

Related posts:

• Film review: #ReGeneration 6 November 2012
• Illusion of Control 25 April 2012
• Ethics vs Compliance 31 July 2011

Red Packets (Photo credit: xcode)

Reciprocity is so fundamental to social organisation yet we don’t often bother to name or think about it.

An underlying norm of reciprocity is by itself a powerful engine for motivating, creating, sustaining, and regulating the cooperative behavior required for self-sustaining social organizations, as well as for controlling the damage done by the unscrupulous. (Wikipedia)

An example of reciprocity in action are the hundreds of millions of packets of money being exchanged around the world today wherever Chinese culture has had an influence.

Reciprocity as a norm pre-dates its more recent manifestations such as the Golden Rule of Christianity or the similar formulation promulgated by Confucius (Do not do to others what you would not have them do to you).

In contemporary nation-states it finds its way into positive law and, when it doesn’t, it is what drives activism to make laws fairer.

The problem is that it is something we devised in a small group world, where co-operation is necessary for survival, whereas today we live in a planetary society. However the underlying necessity is no less valid, in fact if anything it is even more valid than it was in millennia past.

Pre-modern humans knew survival skills. They knew how to find their own food and could survive if isolated from their community. Larger scale social organisation meant specialisation and abandoning the ability to fend for oneself in every respect. Now that has gone a step further and arguably entire nations are now integrated in the same manner.

Yet … where’s the reciprocity gone in this equation? Those people who work in other nations making our clothes, growing our food, assembling our consumer knick-knacks, what do they get for their trouble? Poverty wages that would never allow them to aspire to the same kind of lifestyle. How fair is that?

We all tolerate this, we are all aware that we are tolerating it, and we feel uneasy about it because of reciprocity. If they were merely poor it would be another matter, but they are poor because people pay them peanuts, in the name of the consumer: i.e. you and me.

All of this because “they” are so far away we never get to meet them or learn their names.

Related:

• Coping with large numbers 6 April 2011
• Diffusion of responsibility 6 January 2011

The Human Condition (film trilogy) (Photo credit: Wikipedia)

The Japanese film trilogy Ningen no jôken (1959-61) is an ethicist’s smorgasborg.

The protagonist, Kaji, is a well-meaning humanist who constantly finds himself swimming against the tide first as a factory manager in Japanese-occupied Manchuria (Episode 1), then as a drafted soldier (Episode 2) and lastly as a battle survivor trying to survive amid enemy forces (Episode 3).

In this review I’ll look only at Episode 1 because of its focus on labour and management. Episodes 2 and 3 deal with warfare.

It’s fair to say the film, and novel on which it is based, are the fruit of a penitent Japanese wondering, post-war, how things got so out of hand and what happened to the voices of restraint.

Kaji begins the film as an idealistic and newlywed graduate sent to Manchukuo, Japan’s puppet state in Northeast China, during World War II. He works in a factory making iron which is of course critical to the war effort. It feels like a long time ago but then I remembered that Samsung was created next-door in Japanese-occupied Korea prior to the events portrayed in this film (as covered in this book).

Fresh from his studies, one of Kaji’s core beliefs is that workers will be more productive if treated well, rather than being beaten and punished for mistakes. This belief is treated with contempt by all the other Japanese. The factory manager indulges him however, believing he’ll learn better in time.

Kaji’s strong principles would make him a whistleblower if the circumstances arose but the film presents him in a much more tragic light. There are no rules being broken because the standards that Kaji espouse have never been legislated, have never become the standards of Japanese society. The corruption of the system is so complete that no one higher up would hear his appeals anyway.

Eventually it goes terribly wrong. Firstly his moralising makes Kaji a target for his colleagues who want to teach him a lesson. Secondly though he gives the workers, most of whom are prisoners, too much credit. They are desperate men while he is a pampered Japanese and they continue to act self-interestedly, weakening Kaji’s influence. In the end several are put to death for an escape attempt which Kaji inadvertently facilitated. He is stricken with guilt and interrupts the execution but has now become an isolated figure, disliked by the Japanese but now hated even more fiercely by the Chinese. The film closes with him being called up for army service, apparently at the behest of the fed-up site manager, which sets the stage for Episode 2.

The film is an exceptional tragedy, a story of a man brought down not by his character flaws but by his high principles. It’s also an indictment on indifference, on comfortably going along with what everyone else does. Even in A Few Good Men, for example, there was some moral ambiguity. The Colonel’s departing line “You have just weakened a nation” has some truth to it. However in Ningen no jôken there is no question that Imperial Japan is totally corrupt and really needs to be weakened. No one proves capable of doing it from within.

As we look around our present-day milieu, what do we see? Looking at environmental and human rights problems, there’s always an argument for moral greyness about them, which usually comes down to prosperity. Well Imperial Japan and even its vassal territories prospered too; history doesn’t judge them kindly. Prosperity is not reason enough. Are we the bit-part characters of the film? Happily going along with what is ugly in the world because we benefit from it?

Update 4/4/13: Incredibly a group of Chinese who were forced to work for the Japanese in Manchukuo -specifically for Mitsubishi- are just now banding together to demand an apology and compensation. To quote another film (Magnolia): ‘We may be through with the past, but the past isn’t through with us’.

• Ex-slave workers to sue Mitsubishi People’s Daily Online, 2 April 2013

Related posts:

• Coping with large numbers 6 April 2011
• What if there really is no villain? 29 December 2011

2012 (film) (Photo credit: Wikipedia)

Ok it’s that time again. I’m all in favour of transparency so had better walk the talk with a micro annual report.

Stats for the year just ended:

• 46 new posts; half as many as in 2011
• 106 new followers on WordPress and Twitter; almost exactly the same as last year
• 7090 page views. This is almost double 2011′s 4078, however it’s mostly attributable to there being more content to attract search traffic. By my back-of-the-napkin math, the number of views-per-post was slightly less last year, at 64, than the previous year, at 68. To get that figure I’ve used the number of posts at mid-year as an average.

So it’s a slow old process building these numbers organically. There’s a great quote from the Canadian politician and businessman Martin Shulman who was asked, “What is the best way to make a million dollars?” He replied, “Start with $900,000″. I think the same can be said of web traffic! Anyway I’m not too worried about it. While the visits are gratifying, ultimately this is not a campaign website, I keep writing not to get more traffic but because writing publicly forces me to clarify my thinking on these issues. Hopefully it is getting more readable over time though.

The highlight of 2012 was the LabourStart Conference here in Sydney, which I was involved in. It was great to meet and speak with many people firsthand, including Yiyi Cheng from SACOM, Anita Gardner from IndustriALL and Eric Lee from LabourStart itself.

The biggest learning experience of the year related to the limitations of labour solidarity, in two ways connected with this conference:

Firstly, in the lead-up, LabourStart actively sought the participation of labour organisations that were affiliated with Global Union Federations (with exceptions, notably SACOM). I know for a fact that a number of more grassroots labour organisations wanted to participate but did not have the resources to attend. That’s unavoidable but the result is that the conference was skewed towards what you might call professional unionism. I’m not saying that’s a bad thing, just noting that there were many voices who weren’t heard. At least Asian Women at Work got a speaking spot. To be fair, LabourStart wanted to have a broad appeal but they had reason to be cautious about inflammatory speakers, after unhelpful elements tried to hijack their previous conference in Turkey.

(As an aside, if I was running LabourStart I’d be courting grassroots Asian labour activists wherever possible. Why cling to the ITUC? They are talking about establishing their own news network for affiliates, which would be a competitor to LabourStart in countries where the labour movement is well established … that’s my two cents anyway)

Secondly, and even closer to home, around the time of the conference I was approached by one group lobbying for international students in Australia (who are mostly Asian) for assistance in receiving correct pay. It was heartbreaking but I was not able to assist them in my day job at an Australian union, as it just didn’t fit with our organising model and would have been a distraction at best.

The lesson I’ve learned firsthand is that cross-border co-operation is easier said than done. Apologies to the Swedish metalworkers who I criticised earlier in the year for a similar missed opportunity, I’m sure they tried to make it work.

The second-ever post on this blog was about Apple and Foxconn. I haven’t come back to them since, mainly because I figured that the story had been picked up by the mainstream media and an investigation was commenced. Then I came across this:

Journalism is printing what someone else does not want printed. Everything else is public relations (George Orwell – via @FredrikGertten)

The so-called investigation into Foxconn which took place in 2012 has made me despair of the media who uncritically reported that lots of progress has been made. Anyone with a high school diploma who read the entire report could see that the main issues are not resolved at all, and wage levels are not even mentioned.

In response I have put together my own White Paper, highlighting the shortcomings of Apple and Foxconn’s remediation point by point, which you can download here:

• White Paper on Apple and Foxconn (PDF: 1.7MB)

I spoke with SACOM before publishing this. There is no democratic union at Foxconn so, as the people in touch with the workers, SACOM are probably the next best thing. They say the workers’ priorities are:

1. A better system for scaling of production during peak times, and
2. Worker input into selection of union reps.

As you’ll see in the Paper, neither of these issues have been addressed at all.

See also:

• Polishing Apple: Fair Labor Association gives Apple undue credit for labor rights progress (Economic Policy Institute) 8 November 2012
• New iPhone, Old Abuses: Have working conditions at Foxconn in China improved? (SACOM) 20 September 2012