To be part of the solution means bearing responsibility for the total impact of business operations — for the manner in which they treat their employees, for their security arrangements, for their effect on the social, physical and political environment in which they operate. This is certainly a philosophy espoused by Samsung, the $112 billion electronic conglomerate that is Korea’s second largest company. The disastrous implosion of the Indonesian economy towards the end of the millennium resulted in a backlash of frustration and resentment against ethnic minorities and foreign companies. But Samsung managed to stay clear of the storm. At the height of the unrest, its local employees in Surabaya pulled together to protect Samsung’s refrigerator factory and shield expatriate managers from violence. Local workers enlisted relatives in the countryside into a food supply network that helped insulate their colleagues and even neighboring families from skyrocketing prices for staples like rice and palm oil.
That kind of loyalty isn’t easily won. Since taking over the firm in 1987 from his father, group chairman Lee Kun Hee has stressed initiatives to improve the lives of local employees as part of a broad concept of corporate citizenship. In 1997 the firm spent some $119m in what it calls ‘social contributions’, measured against profits of $291m. Social contributions included Adopt-a-River environmental schemes, building toilets, providing computer lessons and supporting the elderly and children from low-income families. “Business has a role in building a community that goes well beyond giving back,” says Min Kyung Choon, who heads Samsung’s goodwill efforts. “Charity is not enough.”
Not everyone has yet gone as far as Samsung. A bare minimum for corporate responsibility means saying no to dealing with torturers and despots. That is what Levi Strauss decided when it closed operations in China. That one action, by the way, endeared them to the hearts of the young. Indeed, the message from the streets is that consumers are expecting moral decisions. As businesspeople, we have to re-think our approach to these issues and then we have to act, in ways big and small, to bring sustained and healthy growth across the globe. Our political postures must change — we have to stop endlessly whining for easier rules, lower costs and fewer restrictions. And our business practices must change too. We have to take longer-term views, invest in communities and build long-lasting markets.
We have to change our basic notions of what motivates us as business people, of what our corporate goals should be. Less than a century ago, visionary business leaders were hooted out of business associations for saying that businesses had a responsibility to support charity; they were told that the concept of “good corporate citizenship” was radical pap. Indeed corporate contributions to charity were often illegal. Depression and world wars changed us then, global poverty and environmental destruction must change us now.
Everywhere we look we see signs that business is changing. The Co-op Bank refuses to invest in businesses it views as unethical, including producers of fossil fuels and arms manufacturers. Iceland was first major supermarket chain to ban GM ingredients and has since pledged to remove all artificial coloring from its own brand products. But it’s a slow process. So few business leaders have even begun to accept what, for me, has always been a simple truth: there is more to business than making money. The business of business should not just be about money, it should be about responsibility. It should be about public good, not private greed.
I believe we need to measure ourselves against a different standard, and we need to know — each and every one of us — that we can make a difference. We need business that respects and supports communities and families. We need business that safeguards the environment. We need business that encourages countries to educate their children, heal their sick, value the work of women and respect human rights. We need to measure progress by human development not gross national product. Companies have to ask themselves: “What does profit mean? Profit for whom? Maybe we should redefine profit.
Those measurements are beginning to count. For retailers, the pioneering efforts of Levi Strauss and The Body Shop in building human rights criteria into commercial decision-making, have been underlined by the development of the Council on Economic Priorities’ auditable social accountability standard, SA8000, and the UK’s Ethical Trading Initiative. Both of these directives involve companies and NGOs in the development of principles to protect the human rights of the workforce down the supply chain.
Corporations must start showing more developed emotions than fear and greed, and we have to find ways to halt the economic growth that alienates non-economic values. But there is more to all this than measurement, and that brings us back to the word ‘reverence.’ There is a spiritual dimension to life that, for me, is the real bottom-line. It underpins everything and I suggest should be incorporated into global management education if it is to be truly worthwhile. Spirituality, to me, is a very simple attitude that has nothing to do with organised religion; it means that life is sacred and awe-inspiring. In my travels around the world, I have been grounded — as millions also have — in the most fundamental of insights: that all life is an expression of a single spiritual unity. We are not, as humans, above anything, contrary to what Christianity tells us; we are instead part of everything. This interconnection has to be sacred, reverent and respectful of different ways of knowing and being.
We need these different ways of knowing now that the business assumptions forged during the industrial revolution are faltering. Predictable and controllable business environments, employees and political structures have become a thing of the past. We should be evolving into a new age of business with a worldview that maintains one simple proposition — that all of nature, humans, animals, earth, are interconnected and interdependent. We are all in this together and at the crossroads. We have the power to preserve or destroy the sacred interconnections of life on this planet.
It takes an enormous effort to experience spirituality within the contradictions and paradoxes of human organizations and big business. What we need, said Krishnamurti, is not just to change the system but also to change ourselves: “Systems, whether educational or political, are not changed mysteriously; they are transformed when there is a fundamental change in ourselves. The individual is of first importance, not the system; and as long as the individual does not understand the total process of himself, no system, whether of the left or of the right, can bring order or peace to the world.”
I would like the big business corporations of today to learn a few lessons from the Quakers, who ran excellent businesses, yet remained utterly decent and responsible. They had a public policy, they never lied, they never stole money from the corporation, and they never took out more than they put in. They cared for the community and they seemed to do really well. What is needed in business is a return to kindness and a rejection of obscenities like huge compensation packages for CEOs. I think it is a sin to sack thousands of people and then accept a million-dollar bonus — a sin of the human spirit. Maybe there should be a new word in the business lexicon — frugality. It’s like good housekeeping or good environmental management. Frugality is good for business in a way that profligacy is not.
The Quakers would have also supported the proposition that business is such a powerful force in society today it ought to be harnessed to effect social change, to improve the quality of life in those societies around the world where basic needs are not being met. What today’s corporate reactionaries forget is that, long before stakeholding became a political buzzword, it was sound business practice. The great Victorian philanthropists endowed educational institutions, libraries and hospitals in their local communities, and worked hard to improve the conditions and education of their employees. They understood that a cohesive society is an essential foundation for business success, and that their companies would thrive with healthier, better-educated and more productive people.
It would be folly if we didn’t see the role business can and must play in the development of human beings to their fullest potential. My vision, my hope, is simply this: that many business leaders will come to see a primary role of business as incubators of the human spirit, rather than factories for the production of more material goods and services.
I would also like to see business schools must live up to the challenges of the next decade. Any future business education programme, whether it’s set in a local or global context, must contain the language and action of social justice, human rights, community economics and ethics, as well as the productivity of the human soul. The revolution is for business schools to become the place where our personal values and economic interests intersect.
When I look back at the last few paragraphs, I know this is an area which evokes the most ridicule. What has it got to do with business? Everything: you have to care for and empower people to stand up and make a difference. The same goes for words like reverence and spirituality. Yet globalization is, in a sense, a kind of quasi-religion. The ‘global market’ is one of the most seductive phrases that we have yet coined. You will hear business urging us to get governments out of the way and let the markets rule. The danger is that, in the end, global markets drive everything that’s valuable out of the way too. The market doesn’t have a human face, a mentality or a conscience. It doesn’t have a record of sympathy, shame or human endeavor, knows neither kindness or loyalty and those things are essential to life.
Changing the System
I think the system can, and must, be changed — not by isolationists, but by the true internationalists. I believe that corporations operating globally can change the system to encourage trade that is fair, sustainable, and devoted to good husbandry of the earth’s resources. I am persuaded that such steps will contribute mightily to political stability and true democracy.
Business should not try to be impervious to agents of change. There is much to gain from being open and accountable. Look at the way Co-Op Bank has benefited from ethical stances. A growing number of fund managers, including Standard Life, now offer ethical unit trusts and pension funds which screen out shares in companies involved in unethical practices. Other companies, like BT, are examining new possibilities for independent assessment of business activities. Over £2.5 billion is invested ethically in Britain alone. It’s a learning curve for everyone. Businesses need to work with agents of change, whether these groups are progressive or traditional.
I don’t pretend for a moment that we’re perfect at The Body Shop, or that every one of our experiments works out, especially when it comes to building trading relationships that actually strengthen poor communities. But we are absolutely committed to thoughtfulness and sensitivity in our trade with communities around the world and I hope we can measure our success in terms of our ability to show just what is possible if a company genuinely opens up a dialogue with communities. The true challenge for all of us is this: are business leaders simply going to stand by and claim that business does not have a social, and therefore moral, role?
Over the past decade, while many businesses have pursued what I call business as usual, I have been part of a different, smaller business movement — one that has tried to put idealism back on the agenda. We want a new paradigm, a whole new framework, for seeing and understanding that business can be a force for positive social change. It must not only avoid hideous evil — it must actively do good.
I am not interested in business as usual. It business as unusual that excites me and what this book is about.
Seattle diary: Wednesday, Dec. 1, 1999: I am holed up in a Seattle bedroom. All I can hear are police sirens. I’m a few blocks way from the protest march. Clinton is on the television referring to the protest of some 40,000 people as a “hoopla”. Here he is, cheerily talking about another myth, that the WTO is helping an already endangered species in America — the family farm, as being a direct beneficiary of globalization. Hasn’t anyone told him that the only ones that receive subsidies in America are the huge agribusinesses?
Walking out of a meeting into downtown Seattle, I get this wonderful feeling of citizen power. The feeling that millions and billions of people, not represented by the WTO, the workers, the farmers, students, indigenous peoples, the economically weaker groups have a voice in the NGOs. I think about how relentless the protesters are. Day after day, no matter what the authorities and the police throw at them, they keep on coming back. And they come back more determined, creative, resourceful and passionate than ever. They seem determined to create a world where reverence is what we practice, with work that fulfils us, building communities based on interdependence and co-operation and nurturing relationships that breathe passion into our lives.
But I also wonder whether I have had a real-life glimpse of what corporate-controlled reality looks like: police in the streets, no civil rights, martial law and jail brutality. They told us time and time again from the stage that this week history is in the making and that we are living it. I feel they might be right. It is thrilling, as is all knowledge, especially when it comes from the heart. I feel it legitimises the stand I have been making and the platform I have stood on for more than 15 years — that big business has to change.