In recent months, Uber has become a poster child – some would say scapegoat – for many things: zero hours contracts, below minimum wage pay, no job perks and claims of harassment. Last week’s astonishing decision by TfL, London’s transport regulator, to effectively ban it by removing its license shocked the millions who use it daily.
Much has been written already about this, but I’d like to start by making clear that I am, like most people, a regular Uber user. And despite my personal experience being inconsistent at best and downright terrible at worst, ride sharing in London has a vital role to play and should not be banned.
Was it a case of The Unions versus Capitalist Inc? No, not really, as one of the unions that’s been fighting Uber in the courts for drivers’ rights to claim ‘employee’ status has given the firm its backing. Was it a political stab by London mayor Sadiq Khan (who oversees TfL) against his former political rival George Osborne, the former chancellor, current Evening Standard editor and advisor to Blackrock, one of Uber’s investors? Not primarily, but I don’t doubt it crossed his mind.
This was my initial response to the story at the BBC while I was in Leeds as it broke last Friday.
TfL says it was about regulation – or more specifically, Uber’s failure to comply with it. And while there’s doubtlessly been huge dollops of spin spewed out by both sides, there’s no denying that Uber’s failure to control its reputation has played a large hand in this.
While some have dressed this saga up as an ‘attack on capitalism by a backward transport regulator’ or similar, it is more an attack on the corporate values of Uber – a company which, in disrupting an old-fashioned industry, has appeared to have little regard for many things people often hold dear.
If we’re honest, any business employing 40,000 or so people will have elements of criminal activity in the ranks. And let’s not pretend that out of the many thousands of licenced and unlicenced minicab drivers in Britain there have not been dozens of regrettable incidents over the years. In that regard, many have said Uber is being held to a higher standard that its peers. This ignores the point that it should be held to a higher standard.
You cannot claim to be “disrupting” an industry, using technology to enhance a sector, and then complain when the bar is raised. There’s no doubt that Uber’s technology – while easily replicated, as it has been in many cities – offers a host of safety benefits, from real-time GPS tracking to the rating and logging of trips. But this only amplifies the degree to which Uber could, and should, have been wholly transparent on any issue of corporate governance.
Reports that incidents which occurred after jobs had finished going unreported to TfL by Uber, if true, are unacceptable. And this letter from a senior policeman claiming the firm failed to report sex attacks seems pretty irrefutable.
If this stuff had happened at a start-up hotel chain or on an airline, what would the response have been? In many respects, neither types of service are as vital to London as Uber has become. For many millennials and students, who never previously would have taken cabs, the concept of a night bus is alien. The irony of course is that with London’s night Tube and a vastly enhanced bus service, public transit in London has never been more accessible, shaming cities like San Francisco and LA.
While I don’t plan to rekindle the whole debate around zero hours contracts (which admittedly work for some people fine, but which are unfair to others) or slave labour (something you could level at councils for how we pay care workers as much as taxi drivers), what’s clear is that the public employs a huge amount of double standards when it comes to its wallet.
What’s clear is that consumers are pretty hypocritical. Would people be as outraged if it wasn’t going to hurt their pocket? No, of course not. Do companies all support sustainability, going green, saving the world and doing the right thing? “Yes, provided it doesn’t cost more,” is all too often the response.
We saw similar – although far more short-lived – outrage when BBC’s Panorama show called out Marks & Spencer for having kids make its clothes in Turkey. Yet, do people think that garments bought from any clothing retailer for £10 or £20 could have been made with anything resembling fair pay? No, of course not. Yet it’s easy to turn a blind eye. People should be honest about the fact that, in fashion, you cannot have speed to market, competitively priced goods and fair pay in Britain. You can only have two. Do people care as long as they can pick up £5 t-shirts? No, of course not. No more than they do about picking up a £9 Uber ride from Oxford Circus to Camden when a black cab would cost double.
KPMG, one of the world’s biggest professional service businesses, has been caught up in the growing scandal in South Africa, firing its top people in the region over the Gupta fallout. The firm acted decisively, unequivocally putting its hands up. KPMG did the right thing.
Uber, in its short life, has become just as prominent as any of these businesses. It’s therefore right that it should be scrutinised as it has been.
So, what now? Like I said, Uber should continue. It serves far more than just the rich, the lazy and the drunk. As someone personally who has seen their vision deteriorate significantly since childhood, I rely on it a lot for travel after dark, as will many people. But the service – which often fails to stop in the right place or have drivers who know the difference between north or south – needs to improve.
The company needs to enhance its corporate governance. It needs to act like a grown-up and manage issues with the maturity of any company claiming to have the same valuation. It should be fully transparent with the regulator and establish an independent ethics board with representatives from appropriate groups, including the Metropolitan Police.
We can be more ambitious though. At a time where pollution and congestion levels are growing, critics have rightly questioned how “efficient” it is to have hordes of cars hanging about merely so people can grab a cheap fare somewhere already served by a bus route. Why don’t we therefore use private hire regulation to more aggressively push greener vehicles? Rather than dish out licenses to any old fume spluttering old rust-bucket (not all Ubers are Priuses or E-class Mercs, which are pretty pollutey), there’s nothing to stop us changing the rules to only promote the very greenest vehicles.
The market would adapt to respond to this and such a move could help fuel the investment needed into vehicles and the charging infrastructure currently been debated.
Above all though, what companies can learn here is that taking any position for granted is risky. Investing in corporate governance, in people and in doing the right thing costs more but offers far more insulation when things run off course.