(re. corporate social responsibility) “This is a subversive doctrine. If businessmen do have a social responsibility other than making maximum profits for stockholders, how are they to know what it is?”
Milton Friedman, 1962
There is no question that numerous instances exist where one man has gained at the expense of others through greed and unethical practices. Such greed cannot be morally justified, nor can it be termed socially desirable. Yet, it is the greed that is immoral, and not the profit system as such.
George S. Goodell, 1972
If profit is the motive – the top motive, the supreme motive, the one-and-only true motive in business — then all decisions are made based on “will this help us be profitable, ever more profitable?” concerns.
And when the profit motive is the top motive, and every decision is made based on the ideas that “will this help us be (more) profitable?,” then even “good treatment” of workers is viewed as a means to an end — profit.
In other words, you treat your workers well in order to earn a larger profit. And, when a worker in any way lessens/lowers that profit, that worker is “expendable.” Outsourcing, offshoring, automation to replace workers are thus all fully understandable and justified because the profit motive demands generating maximum profits regardless of the human cost.
And yet, there is the consistent message of so many thinkers regarding leadership. You know – leadership – actually leading real people at the workplace where one is a leader.
Robert Greenleaf, in Servant Leadership, wrote:
The servant leader is servant first. “It begins with the natural feeling that one wants to serve, to serve first. Then conscious choice brings one to aspire to lead. That person is sharply different from one who is leader first.” The leader-first and the servant-first are two extreme types.
The best test is: do those served grow as persons? Do they, while being served, become healthier, wiser, freer, more autonomous, more likely themselves to become servants? And, what is the effect on the least privileged in society; will they benefit, or, at least, not be further deprived?
Kouzes and Posner, in Encouraging the Heart, wrote:
Really believe in your heart of hearts that your fundamental purpose, the reason for being, is to enlarge the lives of others.
Honored and not diminished. That’s how we all want to feel.
This is a dilemma. How can our organizations be committed to the growth of individuals, the “honoring” of people while never “diminishing” people, while they focus on profit, profit that might lead them to replace these very workers — workers who are good, reliable, hard-working employees, employees with a good work ethic — because it is now better for the profit motive to replace that worker by outsourcing, off-shoring, automating? (I am not talking about employees that do not perform up to the demands of their job. Yes, such employees should be expendable).
This is one of the questions that I wrestle with.
In all of my reading of business books, I read all sorts of reminders that affirm that a leaders job is to build people. Training, supervising, coaching, mentoring… these are all about building people.
Yet, I also get the profit motive. It is really obvious! Any company that is not turning a profit will be put out of business. Especially when another company comes along offering a competitive product or service at a lower cost.
No profit = no business = no company to hire anybody anyway.
One “solution” – or, at least, one approach to this problem, is to focus on Corporate Social Responsibility. Archie Carroll developed a Pyramid of Corporate Social Responsibility (CSR). Take a look:
But, though this pyramid points to good and needed understandings for any corporation seeking to be a good citizen of the world, the country, and individual communities, it still seems to leave out the one element that is most perplexing; how can a corporation honor people when the corporation defines those very people as utterly expendable?
I don’t think we’ve solved this one yet, have we?