Johnson & Johnson (J&J) would like us to believe the company “is committed to helping individuals and communities around the world manage the unprecedented impacts of Covid-19” as part of its commitment to “the communities in which we live and work”. In South Africa, the company claims both to have made “significant investment … to ensure adequate capacity to meet growing business in sub-Saharan Africa”, and “a proud record of active involvement in social investment programmes” … “that address the core needs of less developed communities”.
According to The New York Times, J&J is exporting millions of doses of the vaccine from South Africa to Europe. It has denied the South African government the ability to limit those exports, even though export restrictions are a tool available to help manage public health emergencies in Europe and elsewhere. It has demanded restrictions on liability for even its potentially negligent conduct that it has not negotiated in the developed world. Meanwhile, it is charging South Africans about 15% more for the same vaccine dose than it charges in Europe, despite having conducted its clinical trials here.
In light of such egregiously unbalanced and unfair behaviour, corporate leaders should not be in the least bit surprised by the deep-seated and growing scepticism in South Africa and on the continent about corporations and the system of market capitalism itself.
This scepticism is reflected in the literature that highlights a fundamental disconnect between business and society in Africa, and that it names corporate behaviour as a cause of the continent’s underdevelopment.
Multinational enterprises and other “manifestations of globalisation” have increasingly come under attack from groups that feel marginalised, excluded or taken advantage of by the advance of global capitalism. Social movements and their associated protests against global inequities are growing in frequency and intensity around the world.
These trends contributed to the recent deadly and disruptive looting in South Africa, whose organisers and instigators were able to capitalise on popular animosity towards businesses in the most unequal society in the world, with many involved in the looting citing desperation and poverty as the reason.
Yet one would have to look hard and long to find any recognition in South African business leadership that a crisis of confidence in organised business is at hand. Busi Mavuso, the chief executive of Business Leadership South Africa, is “feeling positive” about business efforts to help “rebuild” after the violence and destruction in KwaZulu-Natal and Gauteng. She characterised as bickering concerns that the township economies that are being rebuilt are those of privileged large corporations. The National Business Institute at least recognises the “need to address the systemic issues of inequality and exclusion urgently and fundamentally”— but without acknowledging business’s role in enabling those conditions. Instead it congratulates itself for its social transformation programme’s “focus on inequality and economic inclusion”.
These and other business leaders appear to ignore, as Harvard Professor Dani Rodrik reminds us, that the unequal access to the gains of corporatisation and globalisation has driven multiple, overlapping wedges in society — between capital and labour, between skilled and unskilled workers and between cities and the countryside. The National Bureau of Economic Research in the United States connects these inequalities to cleavages along racial and ethnic lines. In South Africa, the Carnegie Endowment for International Peace finds inequality to be at the root of “ethnopopulist political entrepreneurship” and the rise of racially-charged party politics such as those pursued by the Economic Freedom Front and the “radical economic transformation” faction of the ANC.
Our way of doing business in the global economy is driving society apart. Corporate social responsibility programmes and initiatives will not change this, given the growing crisis of confidence in the global market economy. Business leaders should not expect that touting spending on “socioeconomic development programmes” will counteract the effects of endemic underdevelopment and violence in the platinum belt in the nine years since the Marikana massacre, despite surging platinum prices. They should not expect J&J’s initiatives to train health practitioners to be well received in the shadow of the company’s actions that makes it impossible for those practitioners to protect South Africa’s most vulnerable from Covid-19. People measure true social responsibility not by corporate social responsibility programmes, but by core business strategies and outcomes.
The fact that 14% of South Africans in 2020 expressed willingness to use force of violence to advance a political cause should be of critical concern to all of us, not least the businesses that are already in the sights of those agitating for fundamental economic change.
Business leaders can, as they largely did until the very end of the apartheid era, claim to be doing what they can, constrained by a fundamentally flawed system — while with every new insult and injury they chip away at confidence in the global market system on which their business depends. Or they can admit that they are an integral part of our broken system, as evidenced by J&J’s vaccine imperialism, and act in ways that create, in every strategy and decision, a more just and inclusive society.
The type of business leadership will determine the extent to which the market economy can thrive, with profound consequences for business and society.