Force For Good

New Year resolutions and The Future We Want

January 19, 2012

The New Year is the time of new beginnings, and our resolutions are the commitments we make to new goals and possibly even new visions. So why not reflect on what kind of future we want?

The power of visions for the future

In 1939-40, during the Great Depression, General Motors created a dynamic and positive vision of what America could be in 1960: a highly car-centred society with automated highways and vast suburbs. The vision was presented on the exhibit Futurama at New York World’s Fair to show the world 20 years into the future, and it made such a deep impression that it has shaped urban development in the United States over the past 70 years.

An updated version, Futurama II, was presented at New York World’s Fair in 1964-65, this time depicting life 60 years into the future. Scenes included an Antarctic ‘Weather Central’ climate forecasting centre, a ’Hotel Atlantis’ for underseas vacationing, desert irrigation and land reclamation, building roads in the jungle and a City of the Future. The exhibit proved to be the most popular with more than 26 million people attending the show in the two six-month seasons the Fair was open. Once again the exhibit was sponsored by General Motors.

On June 1, 2009 the credit crisis closed General Motors, which is now owned by the United States Treasury and Canadian governments, a symbolic mark of the end of the industrial era. Today it is time for a new vision.

The Future We Want

One project is already working on offering a vision of what the future will look like, guided by principles of sustainability. It is The Future We Want™, facilitated by William Becker, former executive director of the US Presidential Climate Action Project, and supported by a wide range of project partners and advisors leading the field of sustainability and climate change research, including UN’s Global Compact network.

William Becker – who is also among the endorsers of my book The New Pioneers – recently told me about the three stages planned for the project:

1) A global conversation using crowd sourcing and social media, in which people from around the world express their ideas for what a sustainable future would be.

2) An exhibit at the 2012 Earth Summit in Rio that depicts these ideas using videos, computer animations and other advanced communications technologies.

3) Worldwide dissemination of these products in several different formats from educational curricula to apps, and a web page that provides toys and tools for professional planners to engage the public in sustainable community development decisions.

William Becker also told me that, ‘we’ve found that creating a realistic yet hopeful vision of the future is an idea taking hold in many different parts of the world and by many different groups. We hope to become a portal through which policy makers, designers, planners and lay citizens can connect with and participate in these efforts.’

Why not kick-start the New Year by sharing your vision for a sustainable future through The Future We Want™ ? – and in the meantime I wish you a prosperous and sustainable 2012, I look forward to sharing it with you. Happy New Year!

This blog post was originally published in The New Pioneers.

The Boardroom and HR's Role with Sir John Egan

January 17, 2012

‘The Boardroom and HR’s Role – with Sir john Egan’ forms the first report from a series of roundtable dialogues that the CIPD and Tomorrow’s Company are hosting to explore issues around how HR leaders can work with leaders and boardrooms to help shape tomorrow’s sustainable and adaptable organisations.

Stewardship Working Party Press Release

January 9, 2012

Leading firms in the institutional investor community have joined forces with Tomorrow’s Company to launch a working party which aims to improve the quality of engagement by institutional investors with UK companies. The practitioner-led group aims to identify engagement styles and practices that seem to be most effective and to share that intelligence with the aim of making engagement more rewarding for investors and companies alike. The group also intends to make a significant contribution to the 2012 revision of the Stewardship Code which the Financial Reporting Council is proposing will take effect from 1st October 2012. The group includes some of the world’s largest and most active investors – Aviva Investors, BlackRock, Governance for Owners, Railpen Investments, Ram Trust and USS.

Rethinking voice – for sustainable business success

December 15, 2011

On 15 November 2011 Tomorrow's Company launched the first report in a programme on employee voice being undertaken in partnership with the Involvement and Participation Association (IPA). The report ‘Rethinking voice – for sustainable business success’ describes how employee voice is critical for the future of UK plc. Employee voice involves a two-way communication and an honest and trusting relationship between the organisation and its staff. Other project partners include BAE Systems, British Gas, HSBC, IAC Group, Thomson and Unipart, who enrich the report with their own experiences and challenges of voice. Finally it sets out a framework that pulls together the factors that we think impact on the quality and effectiveness of employee voice in organisations.

Tomorrow's Value

December 2, 2011

LEADING business people have been discussing the future of their companies and the role they play in the communities they serve in a series of lectures to explore the theme “Tomorrow’s Value”.

The lectures, which have been produced in collaboration by CIMA and Tomorrow’s Company, were designed to explore, question and probe fundamental questions of what is value, what has value, and why it is so important.

A lecture was held at Herbert Smith LLP in London, given by Joe Garner, head of UK retail and deputy chief executive officer of HSBC.

He told the audience: “Acting with integrity means acting with hope, fairness, courage, kindness... being guided not just by rules, or popularity, but by principles and values. It is – ironically – these very values that actually do underpin the workings of the business world.

“I doubt I could prove it, but I work on the assumption that improving customer service, in time, improves profitability. It is my firm belief that by making business decisions that are guided by principles such as trust, care, fairness as well as strength, courage and determination we create a truly sustainable financial performance.”

The series then moved to Mumbai. “Success through corporate sustainability – strategy, leadership and reporting” brought business leaders from across India together to create tomorrow’s agenda for sustainable business at a pioneering event hosted by Tata.

Keynote addresses were given by R. Gopalakrishnan, director, Tata Sons Ltd, and Kishore Chaukar, managing director Tata Industries Ltd.

They stressed the need for organisations to look beyond short-term profits and revenues, focusing instead on the real future and wider purpose of business.

Mansion House was the venue for the lecture “Health, Business and Society”, which saw David Brennan, chief executive of AstraZeneca, talk about the critical importance of building trust so that business can play a full role in developing solutions to prevent, control and treat disease.

He said that he hoped initiatives being made by the pharmaceutical company “will allow us to move the debate on from a narrow focus on price and profitability to how we can secure shared value for society as a whole.

And to gain acceptance of the view that successful biopharmaceutical innovation creates value for shareholders, but also brings real benefits to patients and the communities we serve” “Investing in Stewardship”, saw Paul Abberley, chief executive of Aviva Investors, join CIMA and Tomorrow’s Company at their annual parliamentary reception at the House of Lords.

CIMA chief executive Charles Tilley rounded off the recent events by calling for less regulation and more supervision in order to create long-term sustainable businesses.

For further information on the series, please visit our Tomorrow's Value Lecture series page or www.cimaglobal.com/Thought-leadership/Tomorrows-Value-lecture-series/ . For latest news check #TomorrowsValue on Twitter.

This article was originally published on CIMA's Financial Management page. Click here to view it.

Investing in stewardship

December 2, 2011

On Wednesday 9 November 2011, Paul Abberley, chief executive of Aviva Investors, joined CIMA and Tomorrow’s Company at their annual parliamentary reception at the House of Lords.

Building sustainable businesses

December 1, 2011

There is a real competitive advantage to be gained by companies who set out to build sustainable businesses, explains CIMA’s Victor Smart.

That's the message that is coming loud and clear from the top of the corporate food chain.

At a recent CIMA and Tomorrow's Company event at Herbert Smith, Jo Fox, director of ‘The bigger picture’ at BSkyB, touched upon the need to bypass ‘greenwashing’. Jo commented that she has more than 700 KPIs, including a responsibility to ensure that 86% of the company views their employer as environmentally responsible.

She also revealed that the firm is now making around half of employees' individual objectives relate to their personal values and behaviours at work. How you get results really matters.

And at CIMA's annual President's Dinner, guest-speaker Peter Voser, chief executive of Shell, stressed profit and acting responsibility can, and must, go hand in hand. Shell assesses sustainable development as a measure of performance. To help determine annual bonus levels for the most senior executives, 20% of the scorecard is based on sustainability performance – KPIs include safety, energy efficiency and water usage.

Public trust in businesses may have dropped to a worrying level, yet the best businesses are clearly beginning to embrace the values challenge. They have moved on to the point that how they contribute to the bottom line is reflected in executives' remuneration packages. In other words, behaviours and ethics at work are being rigorously performance managed. That is a significant step foward.

We saw with Lehman Brothers that the board was flying blind. They didn't understand how money was being made, that it wasn't remotely sustainable, or that results had become all that mattered within the team. The hard lesson is that in corporate life the culture always prevails.

Hopefully the culture is changing.

Victor Smart is head of profile and communications at the Chartered Institute of Management Accountants (CIMA).

Gail Purvis has also reported on a recent report from CIMA that reinforces the key role accountants will have to play in greenhouse gas reduction.

This blog was originally featured on AccountingWeb and you can view it here.

Tomorrow's Natural Business Conference 11 November 2011 - Michael Bremans

November 18, 2011

You can download Michael Bremans' slides here. Michael, who is chairman of Ecover International, was a keynote speaker on the day.

Tomorrow's Natural Business Conference 11 November 2011

November 14, 2011

The conference explored how companies can inspire themselves by and through nature, by developing and implementing 'natural business strategies' into their business models. This helps businesses become both sustainable and successful in an increasingly challenging and uncertain global climate.

Keynote addresses and contributions from:

L. Hunter Lovins - founder and president of Natural Capitalism
Dianne Dillon-Ridgley - director of Interface
Michael Bremans - chairman of Ecover International
Andy Wood - CEO of Adnams
Jane Davidson - director of Inspire
Giles Hutchins - global director of sustainability of Atos
Diane Gilpin - director of B9 Shipping
Jo Fox - director of 'bigger picture' BSkyB
Melissa Sterry - futurologist and Earth 2.0
Denise DeLuca - founder of BCI
Andy Middleton - founder of TYF
Nigel Stansfield - senior and vice president of product and innovation at InferfaceFLOR
Anthony Hilton - financial editor of the London Evening Standard

You can download the slide deck from the day here, featuring all the keynote speakers.

India – the land of opportunity & opportunity for cooperation

November 11, 2011

Financial Times Q&A with Mark Goyder and Kai Peters on the future of the company

October 13, 2011

Q&A: What is the future of the company?

To coincide with the launch of the new four-part FT series on The Future of the Company, Kai Peters, chief executive of Ashridge, the leading UK business school, and Mark Goyder, founder director of Tomorrow’s Company, answered readers’ questions. The best were selected and answered, below. There is also an online video of Mark in discussion on this topic with Stefan Stern, director of strategy at Edelman, Michael Skapinker, assistant editor of the Financial Times and Daniel Garrahan, also of the FT.

How much do you think the future of the company rests in India and China?

Simon Boxall, Portsmouth

Mark Goyder One might also ask, is it more India or more China? And, also, does the future lie with the listed company? Arguably, the company of the future will be a family or private business, as it is predominantly today. Obviously, demographics and finance are hugely on the side of Asian companies. You just have to look at the numbers of companies from emerging companies in the FT Global 500.

But... the company of the future will be a global construct. The company of the future may originate in one country, but in time it will cease to be identified as such. In fact the global listed companies now emerging from China and India will shape our world. However, they will also be competing in a global marketplace. Some recent work we did brought home to me a simple truth: a global company is not only competing in a global market for customers and capital. It is also, ultimately, about competing in a global marketplace for admiration.

It is one thing to build powerful manufacturing and service companies in the B2B world. Before you can do the same in the consumer world, however, you have to build enduring brands. Brands are built on trust, and trust is built on meeting wide stakeholder expectations. Chinese and Indian companies that prosper are the ones that understand this. But how many global consumer brands have they built?

Kai Peters As an academic, or perhaps as someone who has too much time on his hands, I often ask myself what the role of a company is. The best I can come up with is that having many people under one roof allows for the joint creation of scale. The academic view is around transaction costs: is it more trouble to outsource than to do things under one roof? So — who is really big? In the west, it would be Walmart and the NHS. In the east, one looks to the Indian railroads and to many of the Chinese state-owned enterprises.

Antonio Borges, who used to be at Insead, has pointed out that in the east, they can still look west to see what to do: there is still imitation or at least organisational guidance on how to organise. In the west, we are exploring much more. This is harder, as there is not really a guide to what we should be doing. That said, what we seem to be doing is decreasing scale: much more outsourcing, independent research labs, etc, etc. It seems ultimately to be more efficient. So, companies will be everywhere in the future, but the larger ones will be in China and India and those in the west will be, in my opinion, numerous but generally smaller.

Given how much email has changed the way companies work in the past 15 years, what do you think will be the next big development in company communications?

Martin Watson, Tunbridge Wells

Mark Goyder The paradox of email is that, while it has made conversations like this one possible, it has also been used as a wall behind which many of us hide when we avoid talking to one another. Business is about meeting human needs. All businesses ultimately meet human needs through having relationships. Frederick Reichheld and other researchers have shown the very strong correlation between healthy employee relationships and healthy customer relationships. The Sears research published a few years back showed how this flows through into profitability.

The technology that has come after email has been far more “convivial” to use the term invented by the great Ivan Illich. Technologically, the next big development will be to use social networking in ways that enable individuals and groups to better come together and solve problems — often without travelling.

But ultimately, the development I long for is to recognise that the best communication technology of all is face to face. When I was a personnel manager in a paper manufacturing site of 1,000 people I spent the first hour of every day walking around and talking to people, so that I knew what was going on. Naively, I would like a return of that style of communications.

Kai Peters Surely we will reach the point of ubiquitous communications access within the foreseeable future. At present, frustrating 3G coverage, grinding Wi-Fi or paid-only access remain a big challenge. I expect that these issues will disappear and that we will have permanent access to our network needs using the same technologies that we are accustomed to: phones, emails and web access.

Speculating about the subsequent wave is much more fun. A recent headline noted that a woman thought that Amazon recommendations were better at suggesting what she wants for her birthday than her husband was – evidently he missed the boat completely. Therefore there is something in artificial intelligence that is appealing for organisations. No doubt video calling will also become useful – although some of the work we have been doing indicates that a proper phone call where the participants are concentrating is much more effective than video conferencing because visuals can easily distract.

My own private area of speculation involves human computer interfaces. Kevin Warwick at the University of Reading is already implanting chips into himself. I suggest that in our lifetimes we will be able to add technology to ourselves as additional memory, as thought-activated phone calls, for example. While one may consider these ideas a bit off the wall, early examples already exist if one looks around.

To what extent will employees working longer and retiring later help or hinder companies in the years to come?

David, Hull

Mark Goyder It will be more help than hindrance. It will force employers to have a continuing conversation about performance. It will introduce the potential for more flexible arrangements, because I anticipate many people over statutory retirement age will want to work part time. It will capture more experience inside companies. It could even drive more younger people into starting their own businesses because the path to promotion in the classic big company is less to be relied on. Ideally, it should challenge employers to think more laterally. More annual hours contracts, perhaps? More scope to negotiate a retraining that helps the mature employee to contribute more without having to leave the organisation. All assuming the employer knows how to create a culture in which the question is “What can I contribute?” not “What are my rights”…but that leads us on to another story!

Kai Peters First of all, it will surely help companies, especially if they have final salary pension schemes. Paying out from 60 or 65 with a life expectancy of 90-plus is very expensive. Given that there are presently predictions that 50 per cent of the children born this year will live to be over 100, we need to be realistic about how to be financially secure for our lifetimes. From the company perspective, we will surely face the trade-off between youthful exuberance and energy, and wisdom from experience. If we get it right, we are in good shape; if we do not we will have youthful frustration combined with older workers blocking mobility and potentially innovation. Overall, I am positive. Certainly in the business school in which I work, experienced colleagues make tremendous contributions.

What is the place of corporate governance in the 21st-century?

David Clark, Leeds

Mark Goyder There are two kinds of corporate governance. There is the box-ticking, compliance stuff. And there is the living breathing accountability stuff. The first is a huge and growing overhead, albeit one that companies have brought on themselves by their failure to do the second. The second is about keeping the company honest.

The company is a living system. Employees are its lifeblood. Strategy is the brain and measurement and communication the central nervous system. Culture is the DNA. Leadership and continued entrepreneurial energy are its soul and spirit. Governance and accountability are its rhythms and disciplines, like exercise, a means of keeping this living organism fit and lean.

Leadership gives a company energy. Governance assures its honesty.

Kai Peters There are, it seems to me, two points to raise here – the first is about “official” corporate governance, and the second is about “practical checks and balances”. From the official side, I firmly believe that organisations need people on the board who are respected and who know about the industry. While it is theoretically a nice idea to be fashionable and have outsiders/customers or a “man/woman off the street” to provide an additional perspective, the reality is that organisations are complicated, and making sense of what they do without depth of knowledge does not work.

On the second point, one comes to something that I’ve written about that can perhaps best be termed “the world is watching”. The immediacy and depth of technology means that external supervision of organisations is greater than ever. Whether it is Wikileaks or Twitter, the public has inordinate power to keep an eye on what organisations are doing. Certainly, this external scrutiny delivers better results than the ever increasing levels of reporting through Sarbanes-Oxley or equivalent.

My son is just about to graduate from university in the UK and keeps talking about becoming an entrepreneur. What advice would you give him in this current economic climate?

Nigel, Manchester

Mark Goyder I recently heard a professional piano teacher say that by the age of five it is too late to become a professional pianist. Fortunately, the opposite is true of entrepreneurs.

I would advise him to achieve his goal indirectly – gather experience, volunteer, if necessary, in the organisation he most wants to learn from, and pay off debt/build up financial reserves, if possible. Identify what he really cares about and what he is really good at. I doubt, unless he is a Richard Branson, that he knows that yet – and if he does he is probably already practising as an entrepreneur.

Most entrepreneurs would also testify to the loneliness of it all. If, in the course of gathering that experience, he meets someone else he thinks he could work with to build a business, I would give him five times more chance of success. I started Tomorrow’s Company in my 40s. Only afterwards did I see that the ideas had been slowly building in my head since I was 17.

Oh, and try writing your own obituary – as recommended by Stephen Covey. It really is a powerful exercise!

Kai Peters While it is altogether feasible to think up a super idea from scratch, most successful entrepreneurs exploit market imperfections in markets they know something about. The question thus arises, whether there is an area he feels comfortable enough in to have something to offer the market. Young people have oodles of energy and are well aware of new trends and needs. Their challenge is to get the business part right. Those with more experience will see that there is an opportunity to cherry-pick niches in established business areas, especially where incumbents are large, slow, and – sorry to say – often previously state-owned. Low-cost airlines, courier services and gaps in education have all been very lucrative.

In my experience, I have found executive MBA students to be more entrepreneurial than full-time MBA students for that reason.

For your son? If he has an idea, and you are willing to welcome him back home to keep his fixed-costs down, he should go for it. In my opinion, there is no such thing as failure. He will learn a lot and hopefully do well. If the idea does not work, he will have learned a lot, kept himself going for a while, and will simply move on to the next bright idea. Best of luck to him.

I find it incredibly annoying when colleagues claim to be “working from home” when, in fact, they are doing no such thing. Is this arrangement going to become the norm? Because I sincerely hope not.

Robert, Bristol

Mark Goyder One of the best definitions I heard of a company’s culture is that it is what people are doing when the boss is not around. You obviously work in a low trust environment. I suggest you seek out a place where people feel committed to the purpose and don’t look over each other’s shoulders. It has a better future. And you will have better blood pressure!

Look at a company like John Lewis. When the company asked the partners in one of their stores a few years ago what they would change, they replied “abolish the lunch hour”. The partners thought it was ridiculous that when most customers are in the store, most employees are off duty. So they changed to having a morning and afternoon breaks.

Kai Peters Guilty as charged – I am working from home right now. Had two meetings this morning in London, am home in the afternoon and am heading out again for a fancy dinner.

The challenge you are pointing to is actually quite profound. In the past, we, as employees, did work where the inputs related to the outputs – manufacturing, service industries where you had to be there. Now, with many of us in knowledge industries, inputs are not a good guide – but we do not really know how to measure outputs.

The second angle is also a challenge. I would suggest that many of us are always sort of working – technology means we answer emails at ridiculous times during the week. We also ponder work questions in unlikely places. It has been suggested that much innovation happens in the “B’s”: in the bed, bath and bus – when we actually have thought time.

All that said, I am afraid that I also have some trouble with the concept – even if saying that seems to contravene dozens of UK and EU laws!

This exchange was originally featured on the Financial Times website. View it in its original setting here.

Tomorrow's Inclusive Development: A new architecture for reducing global poverty

October 11, 2011

Finding common ground in meeting international development challenges: A literature review

October 11, 2011

Finding common ground in meeting international development challenges

October 11, 2011

Poverty Alleviation and Profit Making: UK HGOs and Corporations as Tomorrow’s ‘Force for Good’

October 11, 2011

'A Tomorrow’s Natural Business Conference’

October 5, 2011

‘Learning from nature – the new agenda for business success: a Tomorrow’s Natural Business Conference’

This event will focus on how businesses can succeed in an increasingly challenging climate. Businesses will learn from the resilience and sustainability of nature to survive unpredictability. The day promises to be inspirational and exciting with keynote addresses, high quality panels and practical workshops.

Organisational cultures are no accident - create one, or it will be established by default

October 4, 2011

'UBS $2bn rogue trader shock' proclaimed last week's headlines, the reverberations will be felt for some time to come. It's really hard to comment on the specifics without knowing much more, but it certainly gets you thinking: about the impact of behaviours and cultures, the costs and benefits of getting these right, and therefore the potential value of a respected, high performing HR function, operating at the heart of business performance, leadership and governance.

There is real comfort that UBS has a strong balance sheet so the systemic impact from this incident, however mind boggling the numbers, will surely not be same as other recent examples in the financial sector.

We should however avoid the rush to easy judgement about the importance of organisational cultures being a sufficient mitigation, at least in general terms, given what I know of UBS and its continental European sensibility, sense of heritage and longevity: UBS is an institution more than it is a company or business.

People there will, I suspect, be hurting and reflecting deeply. At least that's the growing evidence when you talk to people in senior positions in banks and financial institutions generally. In a few weeks’ time we have Joe Garner (Head of UK Retail and Deputy CEO of HSBC plc) giving a Tomorrow's Value lecture, which is also part of the Lord Mayor's Initiative - Restoring Trust in the City. HSBC is of course one of the few major banks 'we' have not had to rescue.

Having talked with Joe and others at HSBC for some time, you get a real sense of a values based business. Of course things can go wrong, but that values based culture gives a greater sense of awareness of when something feels risky and needs deeper consideration. In the words of Stephen Green, just because it's legal does not make it right. But more than that, it probably won't make it profitable, especially in the longer term.

Such a culture is no accident. Indeed Sir John Egan, who will shortly be giving the first in the series of CIPD/Tomorrow's Company 'tomorrow's adaptive organisation' roundtables with HRDs and others, puts it, if you don't seek to create a corporate culture, one will be established by default, of perhaps even greater impact for the unintentional consequences it may have.

Back to the banks: what is striking is the intensity of work being done by HR leaders with very senior support within the industry and across the professions to reshape policies and practices across the sector. There's a sense of moral purpose driving this effort fuelled by a determination that 'never again' will public bail outs be needed: the road to recovery clearly has a cultural component.

You know what, I recently talked with a very senior banker who was calibrating how best to respond to the felt need of their staff to 'be proud' to be a banker. This is significant, the pendulum has swung too far, proud professionals who truly have felt shunned, and come up with a whole set of ways of describing what they do to avoid using the 'b' word, are re-finding their voice, as well they should.

A while back, an example like UBS, whatever the rights or wrongs, would have been a further reason to keep heads down, but not anymore. We need to ask much more specific and basic questions, and to keep focus despite the ‘telephone’ numbers involved.

Was there a disconnect between what the dominant culture called for vs the perceived or actual demands being placed at the unit level? Was this compounded by performance and reward incentives? Was there an inability to communicate and manage which led to actions being taken without the knowledge of those accountable, or their capacity to intervene.

It may well be the mix of hard and soft incentives and behaviours which needs to be better understood. Indeed we are working on a major project with Aviva Investors and UNEP FI, together with BLP, Korn Ferry and PwC, with exactly this focus. What's striking is, other than in pockets, how little of this work appears to have been done.

Future solutions won't be able to entirely end such disturbing examples because, in investment banking in particular, the numbers are astronomical, and some risk at least is inevitable. Hence the needs for capitalisation and some form of structural 'firebreak'. But what they can do is to establish the understanding which will build stronger and more resilient cultures, embedded in strong professional standards, and reinforced by effective practices and leadership behaviours, actions and rewards.

They can also do something else - build a greater understanding of what's gone wrong, what can be done, and of the role of next generation HR to be an active part of creating those solutions.

Tony Manwaring, Chief Executive, Tomorrow’s Company

This blog was originally featured on the CIPD website. View the article in its original setting here.

"Reimagining the World Was a Responsibility" - Ray Anderson eulogy delivered by Paul Hawken

September 21, 2011

The following eulogy was delivered by Paul Hawken at a memorial service honouring Ray Anderson held in Atlanta on August 11, 2011.

The Forecast: Winter of Discontent, Chance of an American Spring

September 21, 2011

When House Speakers John Boehner said last week that his relationship with President Obama is like a conversation between "people from two different planets", he identified a disconnect that extends well beyond the House and the White House.

We are two Americas headed for collision. New York Mayor Michael Bloomberg touched upon it with his recent warning about the rising frustration of young people who have graduated college but cannot find jobs. The riots in Cairo could happen here, the mayor said, and he's correct.

Several factors that triggered the Arab Spring are present in the United States today, including crony capitalism, political corruption, poverty and the unmet aspirations of the young. In neighborhood after neighborhood, and in home after repossessed home, the American dream is in shreds while the gap between rich and poor has become a canyon.

Watch for trouble if Republicans in Congress remain adamant this fall about protecting corporations and high-net-worth individuals from tax increases, while cutting programs that benefit the middle class and provide a safety net for the poor.

How polarized is our economy? Let's start with Mayor Bloomberg's point about the young. Matthew Klein noted in the New York Times that one in four Egyptian workers under 25 were unemployed when the revolution began there. Last July, the same percentage of young people was unemployed in the United States -- the highest jobless rate of any age group in America.

Unemployment is even higher for minority youth. The National Urban League reports that more than one-third of America's minority youth are unemployed. The average unemployment rate last July was 39 percent for urban African-American youth and 36 percent for Hispanic youth.

The impact can be profound. A survey in the United Kingdom found the psychological impacts for young people who cannot find work include panic attacks, depression and self-loathing. Other research indicates that when young people are unable to find employment, they suffer lower wages and higher risk of joblessness for years to come.

An analysis of youth uprisings in Egypt or Tunisia, published by Bloomberg Businessweek, could apply equally to the United States:

"In each of these nations, an economy that can't generate enough jobs to absorb its young people has created a lost generation of the disaffected, unemployed, or underemployed -- including growing numbers of recent college graduates for whom the post-crash economy has little to offer... While the details differ from one nation to the next, the common element is failure -- not just of young people to find a place in society, but of society itself to harness the energy, intelligence, and enthusiasm of the next generation."

Klein writes:

"The millions of young people who cannot get jobs or who take work that does not require a college education are in danger of losing their faith in the future. They are indefinitely postponing the life they wanted and prepared for; all that matters is finding rent money...The uprisings in the Middle East and North Africa are a warning for the developed world."

Evidence of polarization goes well beyond our young. The average pay for CEOs in the U.S. is 185 times higher than the average worker's salary. Average income is $31,244 for households in the bottom 90 percent of the economy, compared to $27 million for households at the top of the economy (one hundredth of one percent).

It is increasingly obvious the opportunity society is rigged against most Americans. William Dornhoff, the sociology professor who wrote Who Rules America?, quotes this revealing analysis by an investment manager who works with wealthy clients:

"Unlike those in the lower half of the top 1%, those in the top half and, particularly, top 0.1%, can often borrow for almost nothing, keep profits and production overseas, hold personal assets in tax havens, ride out down markets and economies, and influence legislation in the U.S. They have access to the very best in accounting firms, tax and other attorneys, numerous consultants, private wealth managers, a network of other wealthy and powerful friends, lucrative business opportunities, and many other benefits...

In my view, the American dream of striking it rich is merely a well-marketed fantasy that keeps the bottom 99.5% hoping for better and prevents social and political instability. The odds of getting into that top 0.5% are very slim and the door is kept firmly shut by those within it...

(T)he bottom line is this: A highly complex and largely discrete set of laws and exemptions from laws has been put in place by those in the uppermost reaches of the U.S. financial system. It allows them to protect and increase their wealth and significantly affect the U.S. political and legislative processes. They have real power and real wealth. Ordinary citizens in the bottom 99.9% are largely not aware of these systems, do not understand how they work, are unlikely to participate in them, and have little likelihood of entering the top 0.5%, much less the top 0.1%. Moreover, those at the very top have no incentive whatsoever for revealing or changing the rules. I am not optimistic."

While Speaker Boehner and his colleagues warn against new taxes, some of our biggest corporations pay little tax or none at all. Earlier this year, Sen. Bernie Sanders (I-VT), identified the top 10 "tax-dodging corporations". He found that Exxon Mobil made $19 billion in profits two years ago, but received a $156 million tax rebate from the IRS. The Bank of America made $4.4 billion in profits last year, but received a refund of nearly $2 billion. (Bank of America also received a federal bailout of nearly $1 trillion. Now its officers are considering cutting as many as 10,000 jobs.)

Other big companies that Sanders found paid no taxes in recent years are General Electric, Chevron, Boeing, Valero Energy, Goldman Sachs, Citigroup, ConocoPhillips and Carnival.

As for political corruption, there is no hiding the fact that big money controls Congress -- a situation bound to get worse due to the Supreme Court's decision to abolish limits on corporate campaign contributions. One example: A recent poll showed nearly 60 percent of Americans want to repeal taxpayer subsidies for oil companies. Congress has refused. Senators who blocked a vote on subsidy reform earlier this year reportedly received five times more money from the oil and gas industries than Senators who wanted a vote.

As we have seen from the Middle East to London, and in some of America's poorest neighborhoods, a citizenry that is disenfranchised and suppressed by a system feels no loyalty to that system -- no obligation to sustain it, or even to obey its laws. That's when things get ugly.

Will that happen here? If Republicans remain adamant against tax increases for the richest corporations and families in our country, the underclass may conclude it is not represented in a Congress whose members are paid $174,000 a year ($223,500 for Boehner), whose median net worth is more than $900,000, and whose pensions and health-care benefits are secure.

The way to avoid class warfare is class compassion. For the sake of discussion, think how the social and political dynamic would change in the United States if we saw these developments:

Following Warren Buffett's example, America's high-net-worth individuals form a "Shared Sacrifice Coalition" and urge Congress to increase taxes on the rich. The Coalition quickly grows to include most of the 8,000 Americans who made more than $10 million in 2009.
Americans in the top 1 percent of income launch a "Close the Gap" campaign. They pledge to tithe 10 percent of their gross income to bootstrap programs for workers in the bottom 25 percent of income, for young people entering the workforce, for veterans returning to the workforce, and for long-term unemployed Americans who need new skills to remain employable.
Led by Apple, which is sitting on $76 billion in cash, big companies pledge to "Bet on America" with job-producing investments from the nearly $2 trillion they've been holding on the sidelines of the economy.
To further reduce the federal budget deficit -- and their own vulnerability to the escalating impacts of global climate change -- CEOs, the National Association of Manufacturers and the U.S. Chamber of Commerce put their full weight behind a revived carbon cap-and-trade bill. They insist that carbon revenues, estimated by the Administration two years ago to be $645 billion over 10 years, be used for three purposes: to reduce the government's red ink, to increase federal investment in clean energy research, and to hold middle and lower-income families harmless from higher energy prices.

These are fantasy scenarios. But in the real world, it's the kind of "we're all in this together" citizenship that would help restore an opportunity society.

We need transparent fairness in our tax and political systems, a sense of social responsibility by those most blessed with wealth, and compassion for those who want to work for their share of the American Dream, but cannot.

Follow William S. Becker on Twitter: www.twitter.com/sustainabill

This blog entry was originally available on the website of the Huffington Post. See it in its original setting here.

Aviva Investors’ Position on Meeting of the Experts Group on Disclosure of Non-Financial Information by Companies

September 21, 2011

In this speech, delivered to the Meeting of the Experts Group on Disclosure of Non-Financial Information by Companies, Dr. Steve Waygood discusses the need for greater levels, and uniformity, of discloure by companies on non-financial issues in order to better ensure long-term, sustainable, value creation for both investors and their investee companies. Dr. Waygood goes on to address four key questions regarding how and why to proceed with this aim, and sets out Aviva Investors' position.