Submitted by Ben Teehankee of De La Salle University
Many people believe that business has to do its part to help solve the world’s crises around sustainability, inequality, and materialism, to name just a few. Yet what can businesses actually do when they are faced with demand for ever-increasing profits and growth? Those demands come directly from the story that shapes what businesses do and how they do it.
That story, sometimes called neoliberalism or neoclassical economics, has a clear set of messages for business: make profits for your shareholders without regard to any other stakeholders like employees, customers, or communities—or the environmental costs of doing so. Just make sure that your shareholders get ever-richer. Do so through the supposedly free market and through as much free trade across country boundaries as possible. Everything else will take care of itself, because markets will solve the ills of humanity.
The problem is that this story is proving very problematic. Growing inequality around the world threatens the stability of many nations. Indeed, a study by Oxfam in 2017 showed that eight very rich men now own same wealth as the bottom half of the world’s population. That type of inequality has the risk of eventually resulting in social unrest. Combine inequality with the growing risks posed by climate change, which result from today’s business story that constant growth and ever-expanding use of Earth’s resources is necessary for economic success, and what you get is a story that is, quite literally, leading humanity off an inequity- and climate-change cliff.
Backing away from that cliff requires changing the story that we tell ourselves about what and who business is for, how we measure the real value of business activity, and how businesses operate with respect to the whole range of important stakeholders that they serve and the natural environment. That kind of transformation will not be easy, but I believe that it starts with telling a different story about the purposes and practices of business. The problem is that today we are completely embedded in the story that has been pushed by neoliberalism. That story says that businesses purposes are narrowly defined by maximizing shareholder wealth, that constant growth is necessary to economic health (despite known flaws in the metrics associated with GDP in that they leave out much important work and the negative consequences of some kinds of activities). It says that ‘free’ trade is always a good thing, without regard for its consequences on local businesses or populations.
The neoliberal one is a dominant story and changing it will be a lot of work, as illustrated by a recent paper I wrote. Such stories are built on what are known as memes—or core elements of culture like words, ideas. Think ‘free trade,’ ‘free markets,’ ‘individual liberty,’ ‘limited government,’ which are some of the mantras of neoliberalism. These ideas are so prevalent that we hardly recognize them as simply a ‘story’ about how business needs to behave. Most important, while these ideas are broadly represented, for example, in the messages of the conservative think tanks that I studied, there’s no equivalent message from more progressive think tanks that might, for example, be concerned with issues of dignity, well-being, and flourishing for all…but don’t seem to be, as the WordClouds below suggest.
In fact, while the neoliberal messages of limited government, free markets, individual liberties, and freedom come through quite clearly in the Conservative WordClouds, it’s much harder to find a core message (in the bigger words) in the Progressive think tanks’ messages. Things like public policy, federal-state, and tax policy, which are the most used words, hardly appeal to most of us who want to see change in the world.
For business leaders and others interested in a better world, it’s time to develop a clear, coherent, and consistent message that ‘delivers’ on the goals of a world with dignity and well-being for all, perhaps by even beginning to use those very words!
Sandra Waddock is Galligan Chair of Strategy and Carroll School Scholar of Corporate Responsibility at Boston College’s Carroll School of Management. She is a Councilor of the SDG Transformation Forum and is affiliated with the International Humanistic Management Association of which De La Salle University is a part. Email: firstname.lastname@example.org