Wednesday, 3 September 2014

"win win" versus fighting talk

There's a really irritating para I found in a McKinsey paper on long-termism that serves as a good/bad example of the obsession with 'win win' outcomes in stewardship/ownership land.

in truth there was never any inherent tension between creating value and serving the interests of employees, suppliers, customers, creditors, and communities, and proponents of value maximization have always insisted that it is long-term value that has to be maximized.

This sort of argument is made all the time in the corp gov/responsible investment world. Essentially the claim is that, if we just raise our gaze and look to the long term, all those apparent tensions between different interests both within the firm and in its relation to wider society dissolve away. I hate this with a passion.

First of all I think it's a preposterous claim. It suggests that all the conflicts between labour and capital over hundreds of years are simply a failure to think long term. What is more, the solution to these problems (which might look pretty large to those without management consulting experience) has been stumbled upon on by looking at the behaviour of institutional investors. All those millions of people working in the labour movement, or the green movement, or in business for that matter, could have saved all that time and effort by looking to the long term and learning a bit about pensions. No, it's rubbish. To quote Jim Royle, "never any inherent tension" my arse.

Secondly, despite the desire to present this as the modern, humanised face of capitalism it actually represents a rather oppressive view of society. There is a apparently an over-arching objective - long-term value creation - to which all of us can sign up without there being any 'tension' between our interests. If you don't get it, if you still feel there is a tension, that's because you haven't correctly identified your "long-term" interests. You're suffering from a sort of false consciousness if you like. This, to me, is suffocating as well as wrong. If a government, rather than a management consultant, asserted that all citizens' interests could be met under the same objective, if they would just realise it, alarm bells would start sounding. Why is it any more acceptable to claim this in the business/financial world?

There's a very good line at the end of Tony Judt's Ill Fares The Land where he says that it used to be taken for granted that their were competing claims in society that need to be mediated, but to assert this now is taken to be antagonistic. It feels very true in the microcosm of CG/RI.

I'll come back to this one later.

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