Paul Andersen: Morality means business as ‘unusual’
September 3, 2017
Morality is not the first doctrine of business; profits are. A successful manager makes money for stockholders and shows an upward curve on the profit chart. Why, then, is corporate ethics at the forefront of the news?
The New York Times last week offered examples. In "The Moral Voice of Corporate America," writer David Gelles quoted scions of the corporate world who are standing up for moral codes of conduct.
Gelles found grist for his article after the Charlottesville bloodshed, quoting the chief executive of General Motors, Mary T. Barra, who proclaimed magnanimously that people should "come together as a country and reinforce values and ideals that unite us: tolerance, inclusion and diversity."
Jamie Dimon of JP Morgan sagely reflected: "The equal treatment of all people is one of our nation's bedrock principles."
Darren Walker, president of the Ford Foundation, enthused: "In this maelstrom, the most clarifying voice has been the voice of business. These CEO's have taken the risk to speak truth to power."
How cool is that?! Business leaders are offering moral guidance even as one of America's most notorious business leaders happens to reside at the White House. This come-to-Jesus moment seems to be a corporate reaction to the guy with the pompadour who's running the ship of state onto dangerous shoals.
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The morality of the Trump administration is clearly at issue as scandals and lies permeate the national fabric from the very top. Business leaders will position themselves very well if they can challenge the perceived void of morality in the chief executive by comparing it with their own upstanding moral fiber.
Gelles described this transition as "a broad recasting of the voice of business in the nation's political and social dialogue, a transformation that has gained momentum in recent years as the country has engaged in fraught debates over everything from climate change to health care."
An example of this higher moral ground came from Howard Schultz, chairman of Starbucks, who Gelles described as prominent in proactively addressing social issues: "Not every business decision is an economic one," Schultz revealed. "The reason people are speaking up is that we are fighting for what we love and believe in, and that is the idealism and the aspiration of America, the promise of America, the America that we all know and hold so true."
That sound bite offers moral relativism wrapped in vague platitudes. "The promise of America?" That depends on whether you're rich or poor, black or white, privileged or persecuted.
"For chief executives facing a constellation of pressures," Gelles cautions, "speaking up can create considerable uncertainty. Customers can be offended, colleagues can feel isolated and relations with lawmakers can suffer. Words and actions can backfire, resulting in public relations disasters. All this as a chief executive is expected to constantly grow sales."
That's why certain businessmen and economists see the moral compass of corporate leaders as a failure of management. Unless there is a profit to be made through moral posturing — like greenwashing — moral leadership is not a top priority for CEOs.
To the rare business leader, however, morality is worth all the risks and more. Yvon Chouinard, founder and CEO of Patagonia, equates morality with individual integrity through ecological stewardship:
"Who are businesses really responsible to? Shareholders? Customers? Employees? None of the above. Fundamentally, businesses are responsible to their resource base. Without a healthy planet there are no shareholders, no customers, no employees."
Chouinard offers five steps to moral responsibility, starting with Step 1: "Lead an examined life." This is a first principle in any moral construct, calling on people to honestly assesses their company's (and their life's) environmental impacts.
If you can do that, the rest follows naturally. Step 2: "Clean up your act" by reducing environmental costs. Step 3: "Do your penance" by offsetting unavoidable impacts. Step 4: "Support civil democracy" by championing activists who diversify the body politick. Step 5: "Influence other companies" by sharing knowledge of what can be done.
While Chouinard admits that "Patagonia will never be completely socially responsible," his company is self-directed in moral leadership through a strict code of ethics. Maybe one day that will describe business as usual.
Paul Andersen's column appears on Mondays. He may be reached at email@example.com.