How strong a State

How strong a State

I am grateful to Eddie Chau for suggesting this theme

With the general loss of authority over the past few years and especially over the pandemic, it is hardly surprising that some governments have become assertively dictatorial while others have sunk to control so weak it appears they might be approaching anarchy. Broadly, the authoritarian have become stronger, the democratic, weaker. But, of course, it is never as simple as that, nor should any potential conclusions lead us to consider less democracy to be desirable. “One man one vote” may be a fairly stupid concept of fairness but “all men no votes” is even more gross to those who believe that the foundation of society is cooperation rather than coercion. So what is the best compromise between a dictator and an overblown cabinet of mediocre talent?

If my biases are a little too clearly expressed in this question please feel free to substitute ‘a highly gifted committee of quality politicians’ as the democratic balance of the scales. Indeed, I am not in favour of a dictator in any but the most dire and time-sensitive temporary situations. But I do regret the apparent decline in the quality of politicians in democracies around the world. For several reasons the concept of service seems to have been substituted by greed for power and fame – although once attained the actual power available to be exercised is remarkably little and the fame disappears at even the faintest whiff of corruption.

It used to be easy. In wartime the state dictated what you did; in peacetime the state left you alone as much as it could to enjoy your life. Wars then became ‘cold’ wars, now ‘hyperspeed’ wars – all threats until someone blinks or forgets the rules. Then all hell will break loose. Meanwhile creeping officialdom brought rain forests to their knees and citizens to despair. Queue numbers advising you the amount of time you will have to wait for attention by officialdom of all sorts are an almost final insult to law abiding people who simply do not understand why their simple question “what does it mean, please?” fails to appear in the ‘Frequently asked questions’ and is dealt with by referral to another incomprehensible essay. A State’s greatest power is refusal to answer.

Meanwhile in business the need for strong but understanding leaders occupies much of the time of those in power and those serving them. And rightly so. Chief Executives wield considerable decision making over their succession. They have, hopefully, displayed good judgement in their understanding of their businesses, succeeded in keeping them afloat and profitable and managed their talent in an assertive but understanding way. Masked or not, they will see through the charlatan, the idler and the backslider. They have had simple criteria for success until now. Today they must consider more stakeholders than merely the investors. They will display their prowess in keeping the balance between suppliers and customers, between clean air and pollution, between planet friendly and planet harming process and between necessary discipline and directors’ whim.

Self-regulation has proved singularly unsuccessful in most important matters connected with business. This isn’t the fault of the CEO or the Board. They are performing to satisfy shareholders’ demands. Just as education is held back by parents, so, too, ESG progress is held back by shareholders. As long as they alone elect the directors, who, in turn, apppoint the CEO, their demands dictate the Executive’s survival. There is a simple way to solve this problem. The needs of society are clearly paramount while the destruction of the planet is a serious possibility. Every board should therefore be compelled to have one appointed ESG representative for every Director. And there should be an ESG appointed Deputy Chair.

I hear wails of how difficult this would be. In fact I think Directors would welcome the ESG appointees. Their existence and votes would allow the Board to take a more balanced view. I hear shareholders claiming that their control of the Board would be in jeopardy. Frankly, it has to be in a time of fundamental emergency crisis. They would still have half the votes on the Board and I don’t see many deadlock situations where the planet’s safety is concerned. Board votes would, in any case, be published so we could all see who voted for what. To enact such a decision will take a strong State but that is precisely what we want to save our planet.

We are at war with the elements. They are upset by our behaviour.

It makes the case for a very strong State, doesn’t it?

Good morning

John Bittleston

We would enjoy hearing your views on this somewhat drastic approach to ESG.