A lot has been said about millennials, those born in the ‘80s and who came of age during the 21st century. While I don’t think it’s possible to generalize about such a big group of people, it is a fact that they grew up in a world quite different from their parents’; a world of instant access to information and the ability to broadcast (via social media) it through the internet, mobile communications, a more globalized economy, a geo-political landscape where the Cold War between market democracies and communist regimes has been replaced by tensions related to terrorism, and the frightening impact of climate change. As a result, they tend to be generally more informed of global developments, more empowered to find out things for themselves and to have an opinion about such things and to be more concerned about what goes on in the world.
The millennials have been entering the corporate boardrooms during the past decade, slowly but surely. Will more millennial-enriched boards improve corporate conscience for sustainability? My fearless forecast is that because of their greater exposure to global realities, millennials will contribute to better corporate governance in specific ways.
Transparency and accountability
Millennials entered the workforce in the post-Enron world. They are aware that dishonest financial reporting, ignoring government rules and a general lack of transparency and accountability can be disastrous for business. They have a higher respect for government regulation and public opinion and look at these as inputs for company welfare and not as obstacles to doing business.
Millennials are aware of the growing and disturbing economic inequality in the world. While corporate directors can earn thousands of pesos per board meeting and high returns on their shares, the average Filipino earns less than 1 percent on her savings account. Piketty, author of Capital in the 21st Century, explained that economic inequality can be explained by the equation r>g, or that the return on capital tends to be higher than the growth of the economy as a whole. Thus, the wealth difference between the rich who own capital and those who rely only on labor income will tend to grow over time. In the Philippines, less than 1 percent of the population are invested in the stock market, compared with about half in Singapore and a third in Malaysia.
Manila Water gave 6 percent of equity to all regular employees and majority of their employees remain shareholders to this day. The share price has gone up from a peso per share in the late ‘90s to about P30 per share today. Millennials will open up equity to broader ownership.
Another aspect of inclusive business is ensuring decent workplaces and supply chains. Millennials will push for quality and more balanced work lives. Moreover, with the closer monitoring of global supply chains, millennials will advocate against sweatshop conditions, child labor and other unfair labor practices.
Business students in the ‘60s and ‘70s were often taught that factories had to be built beside rivers not only for easy supply deliveries but also for cheap waste disposal. I think that most millennials would find that a horrible idea. They will push for a cleaner environment because their futures will literally depend on it.
Moving forward, it is vital to get millennial voices into the boardroom as corporations prepare for the disruptive challenges looming in the horizon: the growing shared economy (e.g., Uber), cryptocurrencies (e.g. Bitcoin), artificial intelligence and robotics (e.g., driverless vehicles), managing social media reputation in the era of fake news, among so many others. It’s just a matter of survival.
Dr. Ben Teehankee is a full professor of management and organization at De La Salle University. Email: [email protected].