Can a corporation be socially responsible: some ethical and moral challenges for the AASW

The use of the word “corporation” in the same sentence as “social responsibility” usually conjures up cartoon-like images of global pharmaceutical firms or telecommunication giants being caught behaving immorally.

But even small non- profit professional associations are not immune to poor behaviour. Indeed, not long ago the American Psychological Association (APA) substantially watered down its Code of Ethics in order to provide psychological services to the US Department of Defence (DoD) during the investigation and torture of terror suspects. An independent report concluded that the principal motive was to curry favour, to keep the growth of psychology unrestrained and to create a good public relations response to terror interrogations.

There is clearly a growing disconnect between a moral conscience and a social conscience; between public relations and truth. In a recent book on values and ethics in social work, Professor Richard Hugman and Jan Carter raised the issue of whether the social and moral aspects of conscience could be brought together again.

“It has become common to distinguish between different types of ‘values’, between personal morality on the one hand and a desire or impetus for social, economic and political change, reform and social justice on the other, as though these two aspects of conscience could be bifurcated and operate independently one of the other. This is a contemporary distinction that would have been foreign up to even only a century ago, when conscience was social and moral, indivisible and unitary. But now a moral conscience has become understood as being confined to the private sphere of life, whilst a social conscience is seen as an appropriate responder to those injustices detected as public issues, particularly those involving vulnerability, suffering and victimization for human and other species and the environment.”

 The very mechanism of being a corporation must, in and of itself, shape the way an organization thinks and behaves, responding to the distinction between what is legal and what is moral. I note with considerable disappointment that the recent changes to the AASW Constitution almost completely expunged the section on the values and principles that inform our code of ethics. These include belief in the equal worth of all human beings, respect for others, compassion fairness, respect for privacy, and the promotion of human rights. The deletion was justified by legal advice that the Constitution was not the ‘appropriate’ document to detail values. According to the AASW, there is the risk that the Constitution could be used,

“inappropriately and therefore not for its proper purpose. This particular proposal is about moving, not deleting, language to its proper document. It’s an administrative change to ensure the Constitution remains contemporary.”

Weasel words. Just how could a commitment to human rights be used “inappropriately”? Being a corporation is a legal mechanism that allows us to exist. It should not shape what we believe in.

Ironically, the business world is moving to acknowledge that corporations should not just be motivated by the desire for profit. ‘Benefit’ corporations are now becoming legal entities. In the United States, a benefit corporation, in addition to ‘profit’ as its legally defined goal, includes a requirement to have a positive impact on society, workers, the community and the environment. The Italian Parliament has also introduced a new type of for-profit corporate entity named Società Benefit, a virtual copy of the US legislation. Australia too is in the process of drafting their own legislation.

A benefit corporation’s directors and officers operate the business with the same authority as a traditional corporation, but are also required to consider the impact of their decisions on shareholders, on society and the environment. In a traditional corporation, shareholders judge the company on financial results; with a benefit corporation, shareholders judge performance based on the company’s social, environmental, and financial performance. Transparency provisions require benefit corporations to publish annual benefit reports of their social and environmental performance using a comprehensive, credible, independent, and transparent third-party standard.

Despite having stripped many of its values from is Constitution, the AASW is clearly remains a ‘benefit’ corporation in the broader meaning of the term. Clause 3g of the Constitution, for example, states that one of the objectives of the AASW is to “advocate for the pursuit of social justice and changes to social structures and policies in order to promote social inclusion and redress social disadvantage”.

If the AASW were to hold itself to a third party social responsibility standard, the most relevant would probably be ISO 26000:2010, Guidance on Social Responsibility (International Organization for Standardization). IOS is a worldwide federation of national standards bodies. It is the world’s largest developer of voluntary international standards. Nearly twenty thousand standards have been set covering everything from manufactured products and technology to food safety, agriculture and healthcare. ISO 26000:2010, Guidance on Social Responsibility, was developed using a multi-stakeholder approach involving experts from more than 90 countries and 40 international or broadly-based regional organizations involved in different aspects of social responsibility. These experts were from six different stakeholder groups: consumers; government; industry; labour; non-governmental organizations (NGOs); and service, support, research, academics and others. The core subjects covered by the Standard are organizational governance, human rights, labour practices, the environment, fair operating practices, consumer issues and community involvement and development.

In relation to governance, ISO 2600:2010 states that,

“An organization’s performance in relation to the society in which it operates and to its impact on the environment has become a critical part of measuring its overall performance and its ability to continue operating effectively. This is, in part, a reflection of the growing recognition of the need to ensure healthy ecosystems, social equity and good organizational governance.” (my emphasis)

In relation to stakeholder engagement, the standard provides “guidance on the underlying principles of social responsibility… and on ways to integrate socially responsible behaviour into the organization”.

and

“Some stakeholders are an integral part of an organization. These include any members, employees or owners of the organization. These stakeholders share a common interest in the purpose of the organization and in its success. This does not mean, however, that all their interests regarding the organization will be the same.” (My emphasis)

Located as we are in an affluent Western democracy, many areas of the standard might not be relevant to the AASW, but it should be noted,

“an organization might assume that because it operates in an area with laws that address core subjects of social responsibility, then compliance with the law will be sufficient to ensure that all the relevant issues of such core subjects are addressed. A careful review .. may reveal, however, that some relevant issues are not regulated or are covered by regulations that are not adequately enforced or are not explicit or sufficiently detailed.”

A cursory glance at the Standards would suggest that governance- particularly in the area of stakeholder identification and engagement is a key vulnerability for the AASW. The contours of our vulnerability are clear. Our governance complies well with auditing standards and corporate law, but does not maximize member engagement.

The Standard states,

“Organizational governance is the most crucial factor in enabling an organization to take responsibility for the impacts of its decisions and activities and to integrate social responsibility throughout the organization and its relationships.”

Member engagement is vital in three key areas of the AASW; office holder elections, policy consultations and member forums.

In annual elections only around 16% of eligible members vote. Serious efforts are needed to make it easier to access information about candidates. The option of online voting needs to be explored. Optional preferential voting should be reintroduced. (It was changed to first past the post without explanation!)This method is not only acknowledged by experts to be the most democratic election method, it is more likely to honor diversity.

Governments and many organisations involved in developing policies or position papers have transparent and inclusive consultative processes. This involves clarity around who in the organisation is considering the submissions as well as calling for submissions and publishing them online. The AASW does not make a habit of publishing internal submissions- a major flaw in its governance processes. A recent consequence of this flaw saw the AASW endorse two different positions on gambling reform in Tasmania! Similarly, the AASW did not publish my submission arguing against the changes that stripped the values from our constitution. The overwhelming number of members who sent proxy votes on this issue were therefore not exposed to the full range of arguments against the change.

As I have indicated elsewhere on this blog one of the elements of membership most valued by members is belonging to a network within the AASW. These networks need to be nurtured and listened to, whether they be divisions of the College, branches, mental health social workers, interest groups and so on. The feedback that I receive about networks suggests that, too often, access is clunky, and management is top down, rather than inclusive or empowering.

As yet, there is no agreed way of measuring member engagement or the value that should be put on it. Nevertheless it remains the constitutional duty of the AASW Board to pursue “social justice and changes to social structures and policies in order to promote social inclusion”.

We need an independent review of AASW governance, which is not just focused on fiduciary duties, but on finding governance models designed to build member networks and nurture member engagement. A robust review would ask, how the AASW can,

• help members to make an informed voting choices and participate in AASW elections
• help member forums to be a real policy voice in the Association
• increase the number of member who are contributing their expertise to the AASW
• increase the number of members who renew their memberships
• increase the number of members who actively engage in member networks
• increase the number of members who support each other’s professional development and career aspirations

Wouldn’t it be great to read an AASW annual report that included an independent audit against the relevant sections of ISO 26000:2010.

One day.