Today's Capitalism Sucks. Here's More Evidence.
"Too many companies that profited during the COVID-19 global pandemic over the past year have left a shameful record as they pursue anti-union agendas, deny workers sick leave, and refuse to pay workers a minimum wage on which they and their families can live."
Many of us already knew that today's version of capitalism is painfully broken. For those who weren't all too clear on that yet, the pandemic must have surely opened their eyes.
Not in this together
Let's take an example we are all connected with: supermarkets.
A recently published report by Oxfam evidences just how strongly the pandemic has worsened inequality. In it, they research large supermarket chains such as Ahold Delhaize, Walmart, Sainsbury's, Jumbo, Tesco, Costco, and many more. Here's just a tiny fraction of the sickening data:
During the pandemic, listed supermarkets distributed 98% (!) of net profits to their shareholders via dividends and share buybacks.
Collectively, shareholders of listed retailers have benefited significantly from the pandemic’s payout. Between 2019 and 2020, total dividends distributed to shareholders increased by 123% – from about $10bn to $22.3bn.
The Walton family, owners of Walmart, saw their fortune grow by $3m per hour on average over the past year.
In 2018, it would have taken a woman worker processing shrimp at a typical plant in Thailand more than 4,000 years to earn what the chief executive of a top US supermarket earned on average, in a year. In 2020, it would have taken her more than 5,700 years.
It was bad. It got worse.
Exploitation as a business model
Value extraction is at the core of today's business world. Generating profit, however, is not the problem. The problem is that the profit that's being made is used to please just one group of people: shareholders.
The figures shared by Oxfam show how poorly value is distributed across the supply chain. The above numbers show that tens of billions of dollars are paid out to shareholders. Sadly, at the other end of the supply chain, it looks quite a bit different.
Let's take a look at supply chains related to the following consumer countries: Germany, the Netherlands, the UK and the US.
"For most commodities, the work in the fields, in processing or in aquaculture is paid out of the consumer end-price, with incredibly low margins. Values accruing to workers are consistently incredibly low for wine (around 1%), tea (between 0.7% and 3%) and shrimp (less than 1%). Due to endemic structural inequalities, the share received by women workers was even smaller."
With such extremely low levels of value distribution to that vital part of the supply chain, it's nearly impossible to not push people into inhumane working conditions.
The result? Violence, danger, poverty, modern slavery and many more types of worker's rights violations. As usual, women are even more severely affected by this than men.
Calling all supermarkets: step up your game
The world doesn't have to be this way. Businesses can - and should - take responsibility and proactively contribute to righting these wrongs. That all starts with transparency on how they're currently performing.
Here's an overview of the performance of various supermarkets:
Click here to enlarge image.
Clearly, there's a lot of work to be done. Here's what Oxfam urges these supermarkets to do:
Urgently revisit relevant policies and practices to factor in the risks to workers and small-scale farmers from COVID-19 and the impact on their job and income security; supermarkets should show how their plans have been updated to reflect the specific needs of women workers in their supply chains.
Promptly address actual and potential human rights violations and respect workers’ rights, including by committing to achieving living wages in supply chains.
Urgently adopt a comprehensive gender policy and action plan to ensure that women’s rights are respected, in supermarkets’ own operations and supply chains.
Shift corporate practice on maximizing shareholder payouts and redirect spending towards long-term supply chain investment that ensures fair and decent working conditions for workers, farmers and women in their supply chains.
Politicians have to play their part too. We can't just wait for these companies to change by themselves. "Governments also need to act. They must repeal laws that discriminate against women, promote laws to guarantee a living wage for workers, adopt mandatory human rights due diligence legislation and put a stop to excessive shareholder payouts."
On top of that, customers can influence change by voting with their money while employees can exert power too.
Stakeholders first
To fix today's capitalism, we need to stop putting shareholders' needs above all else. We can't continue to generate profits in order to fill the pockets of the ones who are already wealthy. It's a zero sum game that's destroying both people and the planet.
All stakeholders (employees, customers, suppliers, communities, shareholders, the planet, etc.) need to be taken into account to ensure a fair (and sustainable) way of doing business. We simply can't afford to continue to support business models that exclusively extract and exploit. Doing that will continue to set society up for categorical failure.
It's complete madness and it has to stop.
We've set up the Corporate Rebels Foundation to end inhumane workplaces. We raise money and support projects to fight this kind of injustice. You can help us do that in two simple ways:
Donate so we can support more projects (Corporate Rebels donates as well, sharing 10% of all profits). Click here to donate;
Submit (local) projects that we can support (we've got money waiting to be donated!).