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Swedish firms must learn from Saudi business row

Swedish companies worried about the nation's business links with the Arab world should instead be focussing on their own responsibility to promote and demonstrate ethical behaviour, argues business rights advisor Ruben Brunsveld.

Published: 30 March 2015 16:54 CEST
Updated: 31 March 2015 16:59 CEST
Swedish firms must learn from Saudi business row
A Swedish workplace. Photo: Suzanne Walström/Image Bank Sweden
During the last few weeks, Sweden has become the epicentre of a discussion on the role of the state, business and human rights.  After several other escalating steps, Foreign Minister Margot Wallström’s criticism of the human rights situation in Saudi Arabia was followed by the middle eastern country temporarily recalling its ambassador and refusing Swedish citizens business visas.  
 
With an export of $1.3 billion to Saudi Arabia last year, important actors within Sweden's business community remain deeply worried about the financial impact of the political feud. On March 6th, 31 Swedish business leaders published a statement saying that "Sweden's reputation as a trade and business partner is at stake”.  
 
But what these companies fail to recognize is that the real danger does not come from the Minister of Foreign Affairs criticizing another country, but from businesses not being aware of the true scope of their own responsibilities.
 
Over the last few years a considerable number of Swedish companies have been scrutinized by the media for unethical or even unlawful behavior. From corruption on the plains of Uzbekistan to land grabbing in Ethiopia. From using child labour in the production chain to mining conflict minerals for our smartphones. From destroying ecosystems in Brazil, to disrespecting Sami rights in Jokkmokk. Time and time again civil society and media find possible human rights violations linked to Sweden, Swedish companies and Swedish products. 
 
These examples beg the question that many companies have not yet answered: How far should corporate responsibility go when it comes to human rights? 
 
Since 2011 a new doctrine has evolved within the framework of the UN, which is spearheaded by the UN’s Guiding Principles on Business and Human Rights. 
 
According to these principles companies should:
 
(a) Avoid causing or contributing to adverse human rights impacts through their own activities, and address such impacts when they occur.
 
(b) Seek to prevent or mitigate adverse human rights impacts that are directly linked to their operations, products or services by their business relationships, even if they have not contributed to those impacts.
 
Companies should be aware that this means a large extension of their corporate responsibility. No longer can companies dodge the proverbial bullet by using contracts that outsource responsibility with suppliers, subcontractors or others down the supply chain. The simple fact of ‘being linked to’ is now enough to impose a duty of prevention and mitigation of effects. Even if a company has not contributed to the human rights breach themselves, they still bear the torch of responsibility by virtue of association. 
 
This doesn't make it easy for companies.
 
When a Swedish company operates in Saudi Arabia, it is faced with one of the most challenging human rights dilemmas; what should we do when the state we operate in not only goes below human rights standards, but actually requires and sanctions us to breach human rights standards in order for us to do business? 
 
It is not easy, but the UN Guiding Principles do not let companies off the hook by referring to 'the letter of domestic law'. If they want to do business in that country at all, companies must strive to honour the spirit of human rights.
 
In today's world, social media can change a story into a scandal before the company even knows what’s going on. "What did you know? Why didn’t you know? Shouldn't you have known?" are just some of the questions likely to be asked.
 
Activists are pushing procedural and legal boundaries in Sweden. What is only a principle today, can become a law tomorrow.
 
But why wait for tomorrow?
 
In the 21st century owners demand accountability, investors demand transparency and clients simply want to be sure that what they buy is produced in an ethical way. As the business case for respecting human rights becomes clearer every day, it is time for all companies to recognize that it is not Margot Wallström causing the damage, but their own inability to respond to a rapidly changing world.
 
When businesses fail to take human rights into account it is the market that will make them pay. And that price will be much higher than the cost of a business visa.
 
Ruben Brunsveld is a business and human rights advisor at at Enact Sustainable Strategies, a consultancy company focusing on responsible business
 

Ruben Brunsfeld. Photo: Private

FOOD AND DRINK

OPINION: Are tips in Sweden becoming the norm?

Should you tip in Sweden? Habits are changing fast thanks to new technology and a hard-pressed restaurant trade, writes James Savage.

Published: 5 April 2024 13:59 CEST
OPINION: Are tips in Sweden becoming the norm?

The Local’s guide to tipping in Sweden is clear: tip for good service if you want to, but don’t feel the pressure: where servers in the US, for instance, rely on tips to live, waiters in Sweden have collectively bargained salaries with long vacations and generous benefits. 

But there are signs that this is changing, and the change is being accelerated by card machines. Now, many machines offer three preset gratuity percentages, usually starting with five percent and going up to fifteen or twenty. Previously they just asked the customer to fill in the total amount they wanted to pay.

This subtle change to a user interface sends a not-so-subtle message to customers: that tipping is expected and that most people are probably doing it. The button for not tipping is either a large-lettered ‘No Tip’ or a more subtle ‘Fortsätt’ or ‘Continue’ (it turns out you can continue without selecting a tip amount, but it’s not immediately clear to the user). 

I’ll confess, when I was first presented with this I was mildly irked: I usually tip if I’ve had table service, but waiting staff are treated as professionals and paid properly, guaranteed by deals with unions; menu prices are correspondingly high. The tip was a genuine token of appreciation.

But when I tweeted something to this effect (a tweet that went strangely viral), the responses I got made me think. Many people pointed out that the restaurant trade in Sweden is under enormous pressure, with rising costs, the after-effects of Covid and difficulties recruiting. And as Sweden has become more cosmopolitain, adding ten percent to the bill comes naturally to many.

Boulebar, a restaurant and bar chain with branches around Sweden and Denmark, had a longstanding policy of not accepting tips at all, reasoning that they were outdated and put diners in an uncomfortable position. But in 2021 CEO Henrik Kruse decided to change tack:

“It was a purely financial decision. We were under pressure due to Covid, and we had to keep wages down, so bringing back tips was the solution,” he said, adding that he has a collective agreement and staff also get a union bargained salary, before tips.

Yet for Kruse the new machines, with their pre-set tipping percentages, take things too far:

“We don’t use it, because it makes it even clearer that you’re asking for money. The guest should feel free not to tip. It’s more important for us that the guest feels free to tell people they’re satisfied.”

But for those restaurants that have adopted the new interfaces, the effect has been dramatic. Card processing company Kassacentralen, which was one of the first to launch this feature in Sweden, told Svenska Dagbladet this week that the feature had led to tips for the average establishment doubling, with some places seeing them rise six-fold.

Even unions are relaxed about tipping these days, perhaps understanding that they’re a significant extra income for their members. Union representatives have often in the past spoken out against tipping, arguing that the practice is demeaning to staff and that tips were spread unevenly, with staff in cafés or fast food joints getting nothing at all. But when I called the Swedish Hotel and Restaurant Union (HRF), a spokesman said that the union had no view on the practice, and it was a matter for staff, business owners and customers to decide.

So is tipping now expected in Sweden? The old advice probably still stands; waiters are still not as reliant on tips as staff in many other countries, so a lavish tip is not necessary. But as Swedes start to tip more generously, you might stick out if you leave nothing at all.

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