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The Importance of Failure

In this short article, James Sinclair reflects on the need for those of us striving for a more ethically centred form of global capitalism to admit and learn from our failures.

We learn more from failure than success. This is not a new observation, it dates back at least as far as the Scottish Victorian reformer Samuel Smiles. We recognise this in our personal lives; lessons learned the hard way are often more profound than guidance derived from easy success. However, when applied to transnational corporate ethics, it can be a more difficult maxim by which to live.

The guiding principle of S.54 of the Modern Slavery Act (the provisions relating to transparency in supply chains) was to encourage a corporate race to the top in worker welfare. It was to achieve this through the sharing of data and examples of both good and bad practice. Indeed, some of the better S.54 statements, albeit sadly too few, are full of interesting, helpful lessons from which we can all learn.

However, this article is not really about S.54, but it is about its underlying ethos; that of the iterative, honest and sometimes painful process of learning from our mistakes.

One of the most difficult questions to answer when starting a new alliance initiative such as the FLA is, who should be a member? Of course, we want to be joined by global leaders who exemplify best practice. We also want to avoid companies who have no interest in ethical business practices, but want the world to think they do and want to use us as a conduit in their deception. They are the easy cases. But what about the companies in the middle? The ones who have failed in the past, who may have ‘stained’ reputations as a result of media exposure or involvement in a worker abuse scandal?

As the leader of the FLA, I am often warned to ‘avoid Company x’ for fear of contaminating the FLA brand. But then I meet Company X and it turns out that, despite, or rather because of, their past reputation, they have decided to change and need some help in making that change.

To my mind, these are precisely the companies we should help. Yes, there is a risk to our reputation and we must be vigilant to avoid being used as a means of ‘rights washing’. However, if we encounter companies who genuinely understand the need for change and have committed the resources and leadership to that change, it is incumbent on us to help them, if we are asked to do so.

We ask all of our members to be as honest as possible about their experiences to date, their successes and their failures. We completely understand the commercial imperative towards secrecy and a reticence to be exposed to media scrutiny. We also understand that there are limits to what a company will be prepared to admit. However, in my experience, the lessons of failure contain the best guidance and the public will forgive past mistakes if they see a commitment to learn from them.

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