THE gap between rich and poor Filipinos has been caused not only by poor government policies but also companies that do not subscribe to ethical business practices, according to experts.
In the second webinar of the Philippine Institute for Development Studies (PIDS) 7th annual public policy conference (APPC) on Thursday, former university of the Philippines Economics and management Professor Niceto S. Poblador said the “unhampered profit-seeking behavior” of companies today leads to negative consequences for Filipinos and the economy.
These unethical business practices, Poblador said, lead to higher prices and poor quality products and services; unfair wages and poor working conditions; unfavorable terms in contracts; and environmental degradation.
“The ultimate effect of profit-seeking behavior, as currently practiced, is the destruction, rather than the creation of potential value,” Poblador said.
“One of the worst anomalies of our time is the everwidening gap in income and wealth between the very rich and privileged few in most societies, and the masses at the bottom of the pyramid that are mired in abject poverty,” he added.
he said that while “corruption and ineptitude in government” has been touted as the primary reason for widening inequality, businesses have also been responsible for this as an “unwanted outcome of capitalism.”
Poblador said data from Oxfam showed the richest 1 percent in the world own more wealth than all other people combined.
In the Philippines, based on the latest Forbes data, there was even a 30-percent increase in the wealth of the richest Filipinos.
“[That’s] 30 percent in the face of this ongoing pandemic while the rest of the society has been ravaged by Covid,” Poblador stressed.
however, seeds of hope have sprung from some companies especially during the pandemic. PIDS President Aniceto Orbeta said companies like famous mall owners in the country have cut rental fees of tenants during the pandemic.
Another local conglomerate, Orbeta said, has also extended emergency food packs, shopping vouchers, and medical assistance to families. These, he said, are just some of the ethical business practices during the pandemic.
But crisis or no crisis, some companies have taken social responsibility to another level by taking their cue from one of America’s great innovators, Andrew Carnegie, who made his fortune through Standard Oil in the 19th Century only to give it away in his twilight years.
Paypal experience
IN a presentation during the event, Paypal head of Global Public Policy and Research Usman Ahmed said the company is in the process of improving the salaries of their employees and supporting causes such as Racial equity and Justice.
Ahmed said Paypal is seeking to increase the net disposable incomes of their employees by 20 percent through various initiatives. This is a worldwide program and they have so far been able to increase the NDI of their employees by around 18 percent.
he said the company came to this realization when it surveyed its employees and found that despite providing them salaries of above market rates, many of their people still ended up having no or very little finances in case of emergencies.
Some of the adjustments made by Paypal included granting stock awards annually to all their employees regardless of their tenure and lowering the cost of healthcare benefits for entry-level and hourly employees.
The company has also reviewed and raised wages where appropriate; introduced financial counseling services for all employees; and created an employee Relief Fund to provide assistance to employees having financial challenges.
In terms of Racial equity and Justice, Ahmed said Paypal has committed to invest some $535 million toward this cause and has since disbursed over $300 million.
Of the $535 million, $500 million is allocated toward the economic opportunity fund for high impact treasury and venture capital investments. Of the allocation, $313 million has been disbursed.
Other allocations were $15 million each for empowerment grants and research that support diversity inclusion and equity as well as $5 million for nonprofit partner grants.
Paypal said it has fully disbursed the allocation for empowerment grants and nonprofit partner grants while $5 million has been released to finance researches.
Profit-seekers among bizmen, not just policy, also behind inequality
