Global economic score-carding is pervasive. Indices rank countries’ performance on diverse subjects: corruption, quality of life for expat employees, taxation levels, logistics performance, and more. Some rankings, however, choose more over-arching objectives, ‘ease of doing business’ or ‘economic competitiveness’, and purport to measure countries’ progress towards them against a set of specific factors. The factors left out can lead to perverse results, which in some cases appear to ignore and reward materially negative aspects of an economic environment such as intolerance and discrimination – as if either could ever be good for business.
For example, the World Bank, in its recently published Doing Business report, has for the ninth consecutive year named Singapore the best country in the world in which to do business. The report “provides objective measures of business regulations for local firms in 189 economies and selected cities at the subnational level,” according to the financial institution. Yet, on same day the Bank released its report, Singapore’s high court upheld the country’s law criminalizing same-sex relationships. Similarly, the World Economic Forum’s (WEF) just-released Global Competiveness Report ranks Singapore as the 2nd most “competitive” economy in the world.
The conclusion? Singapore is a great place to do business – unless you happen to be gay. How can two such discordant events be reconciled? How can a country that criminalizes private consensual behavior between two adults also be a so-called ‘great place to do business’?
The fact is, the two events cannot be reconciled – unless business is amoral. If all it takes to be a ‘great place for business’ is the imposition of the fewest possible regulations, then Singapore might indeed be a great place to set up shop.
Demotix/Mohdfyrol Marican Aziz Anwar (All rights reserved)
Yes, Singapore's government's policies on regulation and free-enterprise have created a business friendly environment, but is this appeal undermined by Singapore's denial of some of its citizens human rights?
But if businesses take a more holistic view, then Singapore fails. First, Singapore’s insistence on criminalizing same-sex relationships flies in the face of business sense. As almost every major corporation knows, success in a competitive business environment requires attracting and retaining the best talent, and any law that discourages highly skilled people from working in a particular location is, in the long run, going to bad for business. You won’t attract talent if you inform some of your brightest employees they are risking prison time if they work in your country.
Second, the narrow set of criteria considered in the World Bank’s or WEF’s ranking systems implicitly ignores responsibilities that businesses have, beyond making the easiest dollar. They must have value systems that go beyond profit making. The UN Guiding Principles on Business and Human Rights, championed by both the Bank and the WEF, make clear that companies must respect basic human rights of their employees and oppose discrimination.
To abdicate that responsibility is to start down the slippery slope of calculating just how much discrimination is morally acceptable in the pursuit of profit. At the end of that slope, we arrive at the logic that led German company IG Farben and others to conclude it was acceptable to use slave labor during World War II. It would be hard to argue with their logic if ‘ease of doing business’ or relative freedom from regulation were your only yardsticks. But they’re not.
The World Bank would do well to update its Doing Business report with criteria assessing the human rights landscape, including sexual orientation and gender identity. The result would be a more truthful and useful document. And by the same token, the WEF should ask itself if, alongside Singapore, Qatar, the United Arab Emirates and Saudi Arabia deserve to be paced in the top 25 most “competitive” economies in the world? All criminalize same sex relationships, but to varying degrees also have discriminatory laws against women and treat migrant labor unfairly (in Qatar’s case, they are serious, recent allegations of permitting forced labor).
The apparent blindness of the WEF competitiveness ranking to these issues is especially incongruous, as the WEF itself – to its credit – publishes an annual scorecard of countries performance on gender equality in politics and business - the Global Gender Gap Report. The argument it advances for increasing women’s role in business is precisely that doing so will improve their performance.
To continue to do ‘business as usual’ in places that violate basic human rights is not amoral – it’s immoral. No doubt, for the companies involved the choices are difficult. How to avoid discrimination in countries where it is legally permitted, or indeed mandated? Confronted with similar dilemmas during apartheid in South Africa, the Rev. Leon Sullivan promulgated the Sullivan Principles. The principles laid out basic commitments (like non-discrimination policies based on race and a refusal to segregate facilities) for businesses to follow if they worked in apartheid South Africa. Perhaps it is time for a similar set of principles to be enacted for businesses to follow in the almost 80 countries (including Singapore) where it is still a criminal act to simply be lesbian, gay, bisexual or transgender; or the many countries where gender discrimination is legally mandated. To continue to do ‘business as usual’ in places that violate basic human rights is not amoral – it’s immoral.
Some will argue this is an issue of culture, not universal rights, and that it is not for western governments or business to decry or over-ride local norms. There are two answers to that position. First, such discrimination is impermissible under global human rights norms that apply to all countries. And second, it is hardly simply a ‘western’ concern. In Hong Kong a local non-profit, Community Business, is promoting an index measuring LGBT inclusion in the workplace. The index builds on a Code of Practice Against Discrimination in Employment on the Ground of Sexual Orientation (that companies sign on to), promoted by the Hong Kong Government. The fight for equality is universal.
It’s time for the World Bank, WEF and others score-carding economic performance to wake up to a basic fact. A country cannot be a great place to do business as long as it systematically discriminates against some of its citizens. When you factor in people, then countries like Singapore fail. It’s that simple.
This is an expanded version of an article that first appeared on DiversityInc.Com