“The purpose of business is to serve people” was the mantra of one of the Center for Ethical Business Cultures’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.
This post comes from the latest edition of the CEBC Newsletter, The Business Ethics Exchange.