Consumer protection spells reform<\/p>\n
Ronald Nangoi, Contributor, Jakarta<\/p>\n
Much progress has been made with democracy in Indonesia as
\nshown by the increasing number of political parties and media
\norganizations, and regional autonomy, etc. Yet, the process of
\ndemocracy has been challenged by undemocratic practices.
\nViolence, terrorism, gangsterism,and weak law enforcement, have
\nhampered the country's struggle towards democracy. Freedom of
\nexpression is still being repressed.<\/p>\n
The protection of customers also remain poor. Customers in
\nmany cases are even powerless while reform to strengthen business
\nis uncertain. This will be a handicap not only for the betterment
\nof politics and economics, but also for that of the business
\nsociety.<\/p>\n
Uncertain reform in business is also reflected by continuous
\nrestlessness among employees. Decision making is often
\ncentralized and communication is top-down in nature. These styles
\ndo not fit in today's companies, which now must have strong
\ncustomer or market orientation, though most family-owned
\ncompanies are in favor of authoritarian leadership.<\/p>\n
Under such a leadership, a \"just to please the boss\" mentality
\ncould spread among employees, rather than the mentality to
\nprioritize customers. The company's control mechanism with a top-
\ndown approach would be ineffective. Yet many such companies are
\nstill found despite their supposedly modern management.<\/p>\n
We just wish that our business leaders could learn two things
\nmuch better than the previous conglomerates did. Firstly, past
\nexperience shows that the strong reliance of our conglomerates on
\npower and close connection with bureaucrats has endangered the
\ncountry's business and economy. Business competitiveness is less
\nassured in an undemocratic society, given the lack of
\ntransparency and accountability.<\/p>\n
Good corporate governance in global firms, which aims for
\ntransparency and accountability, is part of efforts to improve
\nefficiency and competitiveness. We are witnessing global
\ncompanies racing for good corporate governance, after the
\nunpopular scandals of big corporations, like Enron, Arthur
\nAndersen, WorldCom, Tyco in the U.S.; SK Corp in South Korea;
\nTokyo Electric Power in Japan, Royal Ahold, Marconi, and Vivendi
\nUniversal in Europe. It is beyond sensibility that not many
\nIndonesian firms seem to have not been incited by the global
\nbusiness movements in the tightening worldwide competition.<\/p>\n
Global forces have in many ways made economies and businesses
\nimprove the quality of management and services. Market forces
\nhave been playing prominent roles in business success. Large
\ncompanies are subject to international conventions and
\nregulations. Therefore, to a certain extent, worldwide
\ncommunities have contributed to the betterment of business and
\nthe creation of democracy in business.<\/p>\n
The global economy basically restrains bureaucrats from
\nintervening in business. It's ironic that the government, instead
\nof the private sector, has been the one taking the most
\ninitiatives to integrate the country's economy with the global
\neconomy.<\/p>\n
Free trade and the global economy should trigger reform among
\nIndonesian businesses. Foreign investment and trade basically
\ndemands improved transparency and accountability in local
\nbusiness. In companies, as BusinessWeek reported in May this
\nyear, it is those foreign shareholders who are among the loudest
\ncrying for corporate reform.\"<\/p>\n
Business leaders should reconsider the implementation of
\nindustrial democracy within their companies, as they dream of a
\ndemocratic society. Instability could occur in an undemocratic
\nsociety, threatening all business activities. It's much better
\nfor companies to take anticipatory actions instead of being
\npressed by foreign investors or crippled due to the increasing
\naccess of global companies within the country.<\/p>\n
They should not ignore political aspirations, but it doesn't
\nmean that they should benefit from political access for their own
\ninterest. The business-bureaucrat close connection has weakened
\nthe country's economy and business. People at large do not
\nsympathize with any gesture of conglomerates to form patronage
\nties with bureaucrats let alone have public service under their
\ncontrol.<\/p>\n
For democracy in business to succeed, not only firms are
\nobliged to empower their employees, but their employees should
\nhave strong will for self-improvement. As Konosuke Matsushita in
\nhis book As I See It states: \" ... increase the understanding
\nthat democracy requires each citizen to strive toward personal
\ngrowth and to respect the rights of other people.\"<\/p>\n
The application of democracy at the company level lays a
\nstrong foundation for business reform. This could lead companies
\nto have strong customer and market orientation with great care on
\nstakeholders' interests. But companies should have their own
\nrules and regulations, which would ensure the freedom of all
\nemployees in expressing opinions, ideas, and aspirations within
\ntheir scope of work and responsibilities. As a consequence, the
\nmanagement is tasked to empower employees for having new ideas,
\ninnovation, improvement, and productivity. All this aims for
\nbetter competitiveness.<\/p>",
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