How can business reduce inequality was the challenge laid down by the Audit Quality Forum. The focus on tackling inequality is part of a series of events run by the Forum that are looking at what business needs to get right to increase confidence and trust.
Inequality is seen as one of the defining challenges of our time. According to the United Nations inequality between countries has been decreasing but inequality within countries has accelerated. So, how should business respond? And what is the role for auditors who are in the privileged position of having unique insights into business? The debates had an international focus as they linked into progress on the UN Sustainable Development goals, of which goal number ten is to reduce inequality.
Keynote speaker, the Rt Hon Lord David Blunkett, of Brightside and Hillsborough, gave the opening provocation at the debate. Lord Blunkett argued that Brexit had highlighted divisions within the UK, with many people feeling excluded and voting for change in the hope that it would improve their economic position. Lord Blunkett argued that business faced a choice - it could be part of the process of healing and developing a divided society that would lead to gains for business, or it could exploit society and face people’s resentment. He suggested that one role that business could play would be to offer microcredit to individuals in the most deprived neighbourhoods who typically lack collateral, steady employment and a verifiable credit history. Lord Blunkett’s full provocation speech can be viewed below.
The Forum kicked off the panel debates with a discussion around the issue of inclusion and how business could ensure that no individual was left behind.
Rt Hon Lord Blunkett
Professor Kate Pickett, board member of The Equality Trust
Trevor Phillips, President of the Partnership Council of the John Lewis Partnership
Sacha Romanovitch, CEO Grant Thornton UK LLP
David Wild, CEO Domino’s Pizza Group Ltd
The debates looked at whether free trade promoted inequality, and identified how strong economic performance was linked to lower levels of inequality. It kicked off by asking the audience to say whether they felt that free trade promoted inequality. Interestingly, they were split evenly in their opinions.
The final part of the debates moved on to economic inequality and focused on issues that included the disparities in pay between executives and their employees and the impact of zero hours contracts. When the audience were asked whether they felt that it was fair that FTSE 100 CEOs earned on average more than 150 times the salary of a full-time employee, an overwhelming majority said no.
Our panelists were asked to say what business could do to ensure that individuals share in the wealth creation.
We asked our panelists how they felt about the impact of globalisation on inequality and what could be done to address it.