Recorded at the Battle of Ideas festival 2014 on Saturday 18 October at Barbican, London.
ORIGINAL INTRODUCTIONThese are said to be unprecedentedly uncertain times for business, but one area where there seems to be much certainty is that businesses need to do more than be profitable providers of good and services: they must also do the ‘responsible’ thing, do the ‘right’ thing, for the rest of society. Even businesses themselves feel they need to do more than simply make money. ...
Recorded at the Battle of Ideas festival 2014 on Saturday 18 October at Barbican, London.
ORIGINAL INTRODUCTION
These are said to be unprecedentedly uncertain times for business, but one area where there seems to be much certainty is that businesses need to do more than be profitable providers of good and services: they must also do the ‘responsible’ thing, do the ‘right’ thing, for the rest of society. Even businesses themselves feel they need to do more than simply make money. Today, the presumption is that businesses cannot be trusted – one element of the broader decline in levels of trust in society – and that this is bad for business and for society.
According to the 2014 Edelman Trust Barometer, only one in two people in the UK have trust in business. A continuing stream of media stories about corporates behaving badly - over a range of issues including excessive boardroom pay and poor working conditions in developing countries - maintains distrust about business motives and actions. It has become received wisdom that in order to restore trust, business needs to reorientate its culture and values.
Yet even the widespread adoption of corporate social responsibility (CSR) policies seems to do little to assuage concerns. To some people, promoting your ‘ethical’ CSR credentials can reek of hypocrisy. Sincere CSR projects can be dismissed as ‘greenwash’. When there is so little trust, can big companies ever satisfy their critics that they are doing enough? As the well-publicised travails of the Co-operative in Britain seem to confirm, there may be pitfalls of being a business that has always had ‘doing good’ high in its values at the expense of the bottom line.
But perhaps we should not expect businesses to ‘do good’. The urge to be socially responsible through initiatives beyond the central, profit-making purpose of a company may be missing the point about what really constitutes ‘doing the right thing’. As Adam Smith wrote in The Wealth of Nations almost 250 years ago: ‘It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.’ In turn, the drive to create new wealth provides the resources for many other social goods, from healthcare and education to funding the arts and museums.
Is maximising profit really at odds with social good? Could the CSR agenda conflict with the social benefits of profit-making business? How important is trust for profitability? When government is trusted even less than business, who should decide what ‘the right thing’ means?
SPEAKERS
Rosalind Searle
co-founder, Centre for Trust, Peace and Social Relations and Head of Trust Research, Coventry University
Marc Sidwell
executive editor, City A.M.
Stefan Stern
director, High Pay Centre
CHAIR
Phil Mullan
economist and business manager; author, Creative Destruction: How to start an economic renaissance
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