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The Institute of Business Ethics (IBE) looked at the different types of allegations made about business in 2007, the issues that were of most concern, the sectors that were most frequently mentioned, as well as the individual organisations mentioned.

As an overview rather than a thorough investigation, it provides some interesting insights into the issues that are currently challenging UK businesses and that the media are interested in.

Campaign groups 

Allegations covered in the media fall into five groups. Most frequently mentioned were moral and ethical concerns.

Campaign groups raised the issue of sweatshop labour and human rights violations, for example, and environmental groups accused companies of their poor ‘green’ performance.

News stories on moral concerns were also the result of investigations carried out by the media, such as undercover investigations into the practices of banks and supermarkets.

Other reports concern allegations voiced by politicians, professional and trade bodies and experts, as well as trade unions on, among other things, tax avoidance, product safety and quality and labour standards in the UK and abroad.

Shareholders are also increasingly active in this area by calling to account the companies in which they invest over issues such as executive remuneration and wider corporate responsibility.

Nineteen per cent of the reported allegations involved organisations under investigation by criminal courts, regulators, parliament and such.

High-profile investigations 

Concerns voiced previously by civil society groups seem to be taken increasingly seriously at the political and judicial level.

The concerns around supermarkets’ abuse of their market power, for example, became in 2007 the focus of an Office of Fair Trading investigation.

Other high-profile investigations addressed the unfair treatment of customers in the financial services industry, price fixing in the aviation sector, bribery and corruption in the defence industry, and the practices of phone-in competition companies.

A further 15 per cent of the new stories reported on the outcome of such investigations, which often meant fining or censuring companies.

Five per cent of the stories mentioned that companies were under threat of investigation.

A small percentage (4 per cent) of news stories were about companies admitting - or taking action in response to - allegations and concerns.

This included supermarkets withdrawing products that might damage the health of customers, retailers ceasing to source from a country known for human rights violations, and companies changing their executive remuneration and other governance practices.

Anti-competitive practices

Malpractice concerning customers was the subject of about a third of the news stories. They addressed, among other things, concerns around product safety, the provision of misleading information and overcharging.

About a quarter of the stories focused on malpractice in the marketplace, which include allegations of anti-competitive practices and of bribery and corruption.

Stories about practices affecting wider society ranked third. In this regard, environmental impact of corporate operations and violation of human rights were of particular concern.

Concerns about environmental impact are high on the media’s agenda, followed by reports about alleged and actual anti-competitive behaviour and the overcharging of customers.

The three sectors that received most attention by the news media were banks and financial services (24 per cent), supermarkets and retail chains (16 per cent) and the extractive industries (10 per cent).

The financial services sector was particularly criticised for its treatment of customers; excessive fees charged by banks for the provision of services, the misselling or misleading advertising of financial products, and the closing of bank accounts of those customers who had complained about excessive overdraft fees.

Human rights abuses 

Another area of concern was the indirect involvement of banks in human rights abuses, for example, when they chose to fund a regime or company operating in a country that actively violates human rights.

Concerns about the private equity sector were also frequently voiced, particularly as the industry became subject of a parliamentary investigation.

Investors were accused of enjoying unjustifiably high tax breaks, of having a negative impact on employee rights and working conditions, and, more generally, of pursuing short-term strategies, which could destroy economic value in the long run.

These accusations may have been fuelled by the industry’s lack of transparency. It is unsurprising that most concerns relating to the extractive industries were about their not addressing environmental impact.

Specific issues were refusal to invest in cleaning-up procedures and insufficient investment in renewable energy.

These went hand in hand with allegations that some oil and gas companies portray themselves as ‘greener’ than they really are.

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