No Word From Our Sponsors Coke, G.E., and McDonald's will get global exposure from the Beijing Olympics. Now they need to end their silence on China.
The 2008 Olympics open next month in Beijing, and 22 international corporations, from Anheuser-Busch to Visa, are formal partners, sponsors, or suppliers of the spectacle. China has long benefited from being commercially ethics-free-it's a kind of retro zone from the Industrial Revolution that Charles Dickens would have found familiar-but now it seeks worldwide recognition and applause. Yet this is the same country that, it's widely agreed, has a terrible human rights record, both domestically-on issues including child labor, media censorship, and arbitrary detention-and in its dealings with ugly regimes abroad. Exhibit A for many human rights groups is Beijing's cozy relationship with the government of Sudan, which has conducted a campaign of genocide in its Darfur region since 2003.
So there are questions: Do the companies bankrolling the Beijing Olympics-a four-year worldwide Olympic sponsorship costs an average of $75 million-have a duty to press for the improvement of human rights practices in China or any of the hellholes it bolsters? Or is that none of the companies' business?
The late Milton Friedman would have answered "no" to the first question and said that it's not their business. In 1970, in an essay for the New York Times Magazine, he asserted, with memorable absolutism, that the sole social responsibility of a business is to increase its profit. Corporate executives are responsible to stockholders alone. Anything that might lead to a decline in profit-such as having the Chinese regime cancel contracts in response to a corporate protest about the country's human rights record-would be the purest form of irresponsibility.
Fair enough. But in recent years, we have heard compelling arguments asserting that corporations, as major social institutions, are responsible not only to their stockholders but to a wider range of stakeholders as well-including all those directly or indirectly affected by corporate actions. In the case of the Olympics, the corporate sponsors underwriting the event could be better equipped even than governments to exert influence on China and thereby improve the lot of those whose lives are hurt by the country's policies.
Beijing is notoriously unresponsive to pressure from traditional political actors, and the Olympic Games-the stage upon which China hopes to display its prosperity and pride-have proved to be a lone point of vulnerability. If the sponsors could combine their influence, they could make a difference.
So what, exactly, should these corporations do? At the very least, they owe it to us to show that they are not wholly blind to human rights issues. Naturally, as commercial enterprises, they cannot be asked to entirely subordinate the interests of their stockholders to those of a more amorphous group of stakeholders. No one expects them to behave like a bunch of Mother Teresas.
But the global practice of capitalism is not a morality-free exercise. We, as consumers, would like to have some indication that the Olympic sponsors aren't totally amoral. Come to think of it, many stockholders at Johnson & Johnson or Panasonic, to pluck two names at random from the list of companies involved in the Games, would probably like to know too. And if consumers choose to take their business elsewhere-citing, say, the silence of General Electric on the Darfur situation-stockholders might start to get very interested indeed.
Adidas and Kodak have shown the way by sending formal letters to the United Nations, calling on it to implement Security Council Resolution 1769, which would install a peacekeeping force in Darfur. (The nonprofit organization Dream for Darfur has given them high marks for this move.)
An activist I spoke to suggested that all 22 of the corporations involved in the Games could issue a joint declaration, for which he proposed this circumspect set of words: "We express our hope that in the leadup to the Beijing Olympic Games, China will do all that it can to help end the crisis in Darfur. We urge our partners in Beijing to continue to call for a peaceful resolution to the conflict and for the full deployment of the African Union-U.N. protection force authorized by the U.N."
Other activists would push for more aggressive and overtly political statements by the corporations in question. But antagonizing China would almost certainly be counterproductive: Getting Beijing's back up would achieve nothing at all for the people of Darfur. Coca-Cola and the like need to be upright corporate citizens of the world-and you can't be upright if you shoot yourself in the foot.
Is all this, as some would say, merely rhetorical theater, nothing more than a salve to the corporate conscience? Perhaps it is. But isn't rhetoric, however muted, better than silence-especially in a case in which silence is perceived by so many as no better than complicity?Visit Portfolio.com for the latest business news and opinion, executive profiles and careers. Portfolio.com© 2007 Condé Nast Inc. All rights reserved.