Corporate Responsibility: A View from an NGO, Business and Academia
“The purpose of business is to serve people” was the mantra of one of the center’s founding members, David Koch, the former CEO of Graco Inc. Following four years of research from prominent academics from around the country, the center is nearing the publication of a landmark book, Corporate Responsibility – An American Experience, that speaks directly to the question of “to whom and for what is the modern corporation responsible?”
A distinguished panel of respondents joined Andy McCormick of the Hershey Company in providing insight into the question of corporate responsibility in a CEBC public forum. Panelists included: Jim Harkness, president of the Institute for Agriculture and Trade Policy (the voice of a non-governmental organization); Mark Murphy, assistant vice president of Cargill responsible for Corporate Affairs, Corporate Responsibility and the Cargill Foundation (the voice of business); and Christopher Michaelson, Ph.D., associate professor of Ethics and Business Law in the Opus College of Business (the voice of academia).
Globalization and the explosion of information technologies have brought about a market transformation introducing another layer of complexity when addressing business’s key stakeholders: suppliers and the human rights afforded to their workforce, and the impact of business on the natural environment. Organizations should be guided by their values in determining an appropriate course of action when addressing these challenges, recognizing that profit is not the sole purpose of business; it has a responsibility beyond the bottom line.
Audience questions brought out sharp differences among the panelists and there simply was not enough time to explore the potential areas of common ground. Is child labor a business responsibility or that of the host country’s government? Does business have a responsibility to address social issues on its own? If it does, is it capable of doing so, or are non-market solutions necessary? Is the business case for sustainability justifiable … how does one determine how much to invest?
One point all agreed on … transparency is essential in doing business globally. Business must engage with its stakeholders and be transparent about establishing a set of goals and measuring progress in the areas of corporate responsibility and sustainability.
CEBC Continues Seven-Part Series of Conversations on Ethics
On March 9, CEBC conducted its fifth session in the series Beyond Compliance: Conversations about Strategies and Practices for Sustaining Ethical Cultures, focused on the role that balancing the interests of stakeholders plays in shaping and sustaining ethical cultures. Member company representatives from a range of disciplines participated.
Our conversation starter was Kenneth Goodpaster, Ph.D., holder of the Koch Endowed Chair in Business Ethics at the Opus College of Business. Ken traced the evolution of the role of the corporation from the classic Milton Friedman “stockholder management” approach to a more contemporary “stakeholder management” approach favored by leaders in the academic, business and non-government communities.Goodpaster then stretched the group by exploring what lies “beyond stakeholder approaches” with a number of provocative questions. Are there deeper societal needs and interests that business shares a responsibility in addressing? Does a sole focus on the organization’s existing stakeholders create gaps that do not take into consideration these emerging societal needs and interests? What is the responsibility of business in defining and addressing these emerging societal needs and interests? Is business a collaborator with others? If so, who else sits at the table? Who convenes the meeting?
A lively debate ensued examining a range of views. One view underscored the important role that business plays in society today with “beyond stakeholder” thinking a natural evolution. Another view questioned whether business should be imposing its views in the identification and determination of societal needs and interests. Yet another perspective questioned the practicality of introducing a “beyond stakeholder” discussion into business when it is focused on the realities of the current economic environment.
At the heart of the discussion was a recognition that the purpose of the corporation has continued to evolve. The group departed thinking about the challenges, the opportunities and possibilities of moving “beyond stakeholder management.”
In our upcoming session on April 27, we will explore the next area of the CEBC model for building and sustaining ethical culture … creating a long-term perspective.
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Center’s Research Receives 2012 Cutting Edge Award from the Academy of Human Resource Development
On March 2, 2012, Douglas Jondle, Ph.D., James Mitchell and Alexandre Ardichvili, Ph.D. received the 2012 Cutting Edge Award from the Academy of Human Resource Development for a paper entitled “Development and Validation of the Ethical Business Culture Construct and Survey Instrument.”
Cutting Edge Awards are made to authors of up to 10 scholarly papers published in the annual conference proceedings of the prior year’s Academy of Human Resource Development.
Papers are awarded based on new knowledge contribution to the HRD field; theoretical or practical importance of the problem; approach and methodology used; links between the results and conclusions; and quality of the reporting.
The paper builds on qualitative research previously reported (See May 2011 Business Ethics Exchange Newsletter) with a three-part quantitative study aimed at identifying dimensions of ethical business culture.
The five dimensions are:
All five dimensions are closely interconnected, and an organization cannot be said to have an ethical business culture if one of the five elements is missing. The areas of emphasis of the five elements may vary based on the unique culture of the organization, but they are still present. However, the study results suggested that the mission and values-driven characteristic could be regarded as the keystone of the model, “the lifeblood of the organization.”
For more information on the research, contact Doug Jondle at firstname.lastname@example.org.
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