Corporations love keeping their shareholders money instead of contributing to society, and it’s the role of governments to ensure that corporations do their part. Usually this comes in the form of taxation. Multinational corporations create multiple subsidiaries to obfuscate and obstruct the ability of governments to collect tax, it’s the corporate equivalent of dining and dashing.
A recent G7 meeting revealed that the largest economies in the world are going to enact a global minimum taxation rate for corporations. Having an agreed-upon minimum will remove the incentive to corporations to create subsidiaries to avoid taxation, while increasing the wealth of nations.
The rules on making multinationals pay taxes where they operate – known as “pillar one” of the agreement – would apply to global companies with at least a 10% profit margin.
Twenty percent of any profit above that would be reallocated and taxed in the countries where they operate, according to the G7 communiqué.
In the case of the UK, for example, more tax revenue would be raised from large multinationals and would help pay for public services.
The second “pillar” of the agreement commits states to a global minimum corporate tax rate of 15% to avoid countries undercutting each other.
Canada announced yesterday that, like other nations, the country will be monitoring how Canadian corporations behave beyond its borders. Over the years there have been too many accounts of corporations based in Canada getting into conflicts and abusing communities of people internationally. Obviously this sort of behaviour is bad for people and tarnishes any positive thoughts people have about Canada. It’s up to the new role of the ombudsperson to check to see that Canadian corporations don’t break any human rights or the like outside the nation’s borders.
The role of the Canadian ombudsperson for responsible enterprise will be to work towards resolving conflicts between local communities and Canadian companies operating abroad.
The position will focus on several sectors including mining, oil and gas and the garment sector.
It will also have the power to independently investigate and make recommendations in cases involving human rights complaints.
If you’ll excuse for a moment while I pander to corporate interests, I think it’s worth noting that Cadbury’s Dairy Milk chocolate bar will now be made from certified fair trade cocoa. This is great to hear, because this is a huge product from a huge company, and it’s another big step towards a world in which consumers have no excuse not to know about fair trade.
Cadbury and the Fairtrade Foundation today announced plans to achieve Fairtrade certification for Cadbury Dairy Milk, the nation’s top selling chocolate bar, by end of Summer 2009. This groundbreaking move will result in the tripling of sales of cocoa under Fairtrade terms for cocoa farmers in Ghana, both increasing Fairtrade cocoa sales for existing certified farming groups, as well as opening up new opportunities for thousands more farmers to benefit from the Fairtrade system.
The press release doesn’t indicate which countries the change will take effect in, but the UK and Canada are definitely included.
The New York Times is reporting that Google is going to start compensating its gay/lesbian employees in same-sex partnerships, for the tax charged on their partner’s employer health benefits; a tax which heterosexual married couples are exempt from. It’s a little thing, but it’s nice to see a corporation do something to right an injustice that has nothing to do with their bottom line.
So Google is essentially going to cover those costs, putting same-sex couples on an even footing with heterosexual employees whose spouses and families receive health benefits.
The company began to look at the disparity after a gay employee pointed it out, said Laszlo Bock, Google’s vice president for people operations (also known as human resources). Google, by the way, says its benefits team seriously considers any suggestions on how to expand its coverage. “We said, ‘You’re right, that doesn’t seem fair,’ so we looked into it,” Mr. Bock said.