Theresa May has watered down her commitment to worker representationby Gavin Kelly / November 21, 2016 / Leave a comment
When Theresa May launched her bid to become party leader and Prime Minister she pledged to ensure workers sit on company boards. In doing so she certainly had an eye for political symbolism. A Conservative leader making clear her desire to put some power in the hands of ordinary workers seemed to touch a chord with a public railing against a so-called out of touch elite.
Whether the Prime Minister had a clear understanding of the unhappy historical precedents in this area is altogether another matter. Today we’ve had confirmation that the idea of putting workers on boards has been ditched and replaced with the tepid notion that a non-executive director should engage with the workforce and report on their views (though the government will proceed with the proposal to force companies to publish the ratio between the pay of their chief executive and average employee). The U-turn on employee representation may be vaulting but it should hardly come as a surprise. The whole episode draws to mind an occasional pattern in British politics: open up the possibility of far-reaching reform to corporate structures, bending them towards the concerns of employees, only to subsequently retreat. A combination of external business lobbying, internal political division and a lack of careful thought about the wider ramifications of piecemeal corporate change sees it off. The winner is the status quo.
In some respects, this inertia is surprising. Since the time when the second industrial revolution began to transform our workplaces the public company has been a central feature of our capitalist economy. All manner of institutions have since been reformed, ripped up or sporadically rebooted as a result of economic shifts and political struggles in the intervening period. Yet the fundamental question as to what a company is, who owns it, and in whose interests it should be run seems settled. The answer—that it should be governed as a private association of property holders—has remained broadly unscathed by universal suffrage, the Great Depression, two World Wars, the creation of the welfare state and the rise and fall of mass industrial trade-unionism. There’s been plenty of technocratic tinkering. But democratic politics hasn’t left a real mark.
In other nations the constitution of the company been subject to repeated episodes of political bargaining…