Vulnerability to Resilience (Part 3) The Power of Collective Action

For small and medium enterprises (SMEs), compliance feels like a lonely climb up a steep mountain. Costs are high, rules are constantly evolving, and there is pressure to cut corners to keep pace. Standing alone, an ethical SME can lose when competing with actors who ignore the rules.

SMEs do not struggle because they lack integrity. They struggle because they must compete with unethical competitors. Doing business, the right way may mean losing business. However, when SMEs come together to address unethical actors, the dynamic changes. Collective action is an SME superpower. It enables SMEs to shift the market towards fairness, establish industry standards, and remove barriers to growth.

The Pathways to Collective Action

Collective action can take many forms, both formal and informal. Some of the most effective include:

• Industry Associations

  Associations provide SMEs with a powerful platform to share resources, create targeted training, and agree on sector-specific standards. Where an association does not exist, SMEs can collaborate to build one. This from-the-ground-up approach ensures that integrity is at the center of the association’s priorities from the start.

  
  

• Chambers of Commerce

  Chambers can link SMEs across industries and serve as trusted advocates. Chambers are also able to amplify the voice of ethical businesses with local governments and international regulators, making it harder for corner-cutters to dominate the conversation.

  
  

• Collective Action Initiatives

  SMEs can also come together around integrity pledges or transparency drives. These initiatives establish visible standards and signal to the market that ethical businesses stand united.

The Payoff

Collective action delivers results. Cost sharing lowers costs. Industry standards prevent a “race to the bottom” while increasing credibility with customers, regulators, and investors. Collective action is a strategy that centers and rewards integrity.

Integrity as a Shared Asset

SMEs can build resilience through collective action. By making integrity a shared asset that gives an advantage to all SMEs, SMEs can ensure unethical actors no longer have an advantage. There is power in numbers, and by collectively committing to protecting integrity, SMEs can create ecosystems of integrity that reward, rather than discourage, ethical actors.

Michele Crymes

Anti-Corruption and Governance Expert