Nestle strike a lesson in importance of corporate responsibility
Reading about the strike by Nestle workers, which has now ended, I was reminded of the qualities that a socially responsible firm should possess.
The main aim of such a company should be to balance the interests of all stakeholders, including employees, shareholders, customers and the government.
Initially, Nestle was not able to meet the basic requirements of its workers.
However, the parties arrived at a compromise after intense negotiations. Human resources are the most important resource that a firm has.
Its employees make up the management, man the production lines and play other important roles. Together they contribute to the success of a company.
A socially responsible firm should provide appropriate financial compensation to its workers. The amount they get paid should be commensurate with their efforts. That means rewards should be linked to the contribution made by workers.
They can be offered further fringe benefits to further motivate them. Such benefits could take different forms, for example, bonuses, holidays or even medical insurance. The management of a firm must ensure employees are suitably compensated.
For example, in the case of Nestle, most of the workers in the dispute were involved in the transport part of the business. Their working schedules are not as stable as other workers, with commission being given for deliveries made. So they were concerned about increased commission and job security, and Nestle conceded this during the negotiations. The dispute illustrated the issues that companies must deal with.
A firm that believes in business ethics has, of course, to think about profits, but it must also bear in mind the community it serves. The long-term stability of a company is linked inextricably to the well-being of society.
Companies that show they care more about their employees will find they have a more loyal staff than firms that do not care. There will be smaller turnover of labour and, therefore, higher productivity. This is a win-win situation for a company.
Candy Ho Sin-hang, Tsing Yi