A Purpose That Serves Society

According to The Blueprint for Better Business

“A business needs to make a profit otherwise it cannot survive — but making a profit is not the purpose of business. There needs to be a connection between the purpose of the business, the benefit to society and to all the other stakeholders: employees want a job, customers want the right goods or services at the right price, suppliers want to be treated properly, investors want a return… purpose is the glue that brings it all together and creates long term sustainable performance”

In 2007, a pioneer of purpose -driven business made the following points in a ‘Marshall Plan’ for Ukraine:

“An inherent assumption about capitalism is that profit is defined only in terms of monetary gain. This assumption is virtually unquestioned in most of the world. However, it is not a valid assumption. Business enterprise, capitalism, must be measured in terms of monetary profit. That rule is not arguable. A business enterprise must make monetary profit, or it will merely cease to exist. That is an absolute requirement. But it does not follow that this must necessarily be the final bottom line and the sole aim of the enterprise. How this profit is used is another question. It is commonly assumed that profit will enrich enterprise owners and investors, which in turn gives them incentive to participate financially in the enterprise to start with.

That, however, is not the only possible outcome for use of profits. Profits can be directly applied to help resolve a broad range of social problems: poverty relief, improving childcare, seeding scientific research for nationwide economic advancement, improving communications infrastructure and accessibility, for examples — the target objectives of this particular project plan. The same financial discipline required of any conventional for-profit business can be applied to projects with the primary aim of improving socioeconomic conditions. Profitability provides money needed to be self-sustaining for the purpose of achieving social and economic objectives such as benefit of a nation’s poorest, neediest people. In which case, the enterprise is a social enterprise. “

In the Long Term Capitalism challenge, I described this as the ‘New Bottom Line’

Are you wondering why this think tank isn’t attributing something copyright and protected by Creative Commons? It was shared with the Great Business Debate in good faith.

Twenty one years ago, it began with a question about the purpose of business and a argument for putting people before shareholder returns.

The purpose of business lies in people, not profit says Charles Wookey of the Blueprint for Better Business 18 years later.

For People-Centered economics there was a fundamental predicate that human beings aren’t disposable and it led to the purpose of children suffering abuse and neglect in state care.

In 2006, the story of ‘Death Camps , For Children’ raised the lid on what was going on inside Ukrainian orphanages. Many had died through sheer neglect.

“We have only to ask ourselves individually whether or not this is the sort of progress we want, where we accept consciously and intentionally that human progress allows for disposing of other human beings.

“This is a tricky question. Except in the case of self-defense, if for any reason we answer ‘Yes’, regardless of what that reason is, we are in effect agreeing with the proposition of disposing of human beings. Whether disposal be from deprivation or execution, the result is the same for the victim. If we agree that sometimes, for some reasons, it is acceptable and permissible to dispose of human beings, actively or passively, the next question is ‘Which people?’ Of course I will never argue that one of them should be me, though perhaps it should be you. You respond in kind, it cannot be you, but maybe it should be me. Not only can it not be you, it also cannot be your spouse, your children, your mother or father, your friends, your neighbors, but, maybe someone else. Naturally I feel the same way. Maybe we come to an agreement that it shouldn’t be either you or me, or our families and friends, that can be disposed of, but perhaps someone else. While we are debating this — passionately and sincerely, no doubt — a third party comes along and without warning disposes of the both of us, or our families, or our friends. And there is the trap we have fallen into, because whether or not we approve of our or our families’ and friends’ demise is irrelevant. It is fair because we accepted the principle of human disposability. We just didn’t intend that it be us who are tossed, but if we or our families and friends die, it is in accordance with principles that we ourselves have accepted and so must live — and die — by.”

This became the primary focus of our work and the plan was to transition all of these children to loving family homes. The proposal appealed to forward thinking businesses for collaboration between business and social enterprise:

“In this case, for the project now being proposed, it is constructed precisely along these lines. Childcare reform as outlined above will pay for itself in reduced costs to the state. It will need investment for about five years in order to cover the cost of running two programs in parallel: the existing, extremely problematic state childcare scheme, and the new program needed to replace it for the purpose of giving children a decent life. The old program will be phased out as the new program is phased in. After this phase transition is complete, the state will from that time forward pay out less money for state childcare. Children will have a better life, and will be more likely to become healthy, productive assets to the nation rather than liabilities with diminished human development, diminished education, and the message that they are not important — the basis for serious trouble. There is no need whatsoever to give these children less than a good quality of life as they grow and mature. The only problem is reorganization of existing resources.”

For Cardinal Vincent Nichols, Archbishop of Westmister its about the primacy of the human person, as it is with people-centered economics.

“My starting point is simple. It is the good of the human person. As a Catholic I have a fundamental belief, along with many others and indeed shared by very many people of no faith, that we must start from the conviction that people really matter. We are none of us simply producers, or consumers, or employees. What we all share first and foremost is a common humanity. Good societies are built on that fundamental respect for the human person. All human institutions — whether public, private, charitable or for profit, secular or faith based– have an overriding obligation to act in a way that serves human dignity and promotes the common good. When they fail to do that — and the Catholic Church has experienced in recent years just such failures — then trust is eroded. Recovering trust, or better recovering trustworthiness, is hard work and takes a long time.”

As Pope Benedict had reasoned in his encyclical Caritas in Veritate when he wrote of the need for ethics in our economy which are people-centered:

Striving to meet the deepest moral needs of the person also has important and beneficial repercussions at the level of economics. The economy needs ethics in order to function correctly — not any ethics whatsoever, but an ethics which is people-centred.”

“This is not merely a matter of a “third sector”, but of a broad new composite reality embracing the private and public spheres, one which does not exclude profit, but instead considers it a means for achieving human and social ends. Whether such companies distribute dividends or not, whether their juridical structure corresponds to one or other of the established forms, becomes secondary in relation to their willingness to view profit as a means of achieving the goal of a more humane market and society. “

Pope Francis followed with Evangelii Gaudium, saying:

“It is heartbreaking that the world today is more concerned about the health of banks than homeless children dying of starvation and cold”, and called on the Catholic Church to seek out those who need help the most.”This is happening today. If investments in banks fall, it is a tragedy and people say ‘what are we going to do?’ but if people die of hunger, have nothing to eat or suffer from poor health, that’s nothing. This is our crisis today,

“The current financial crisis can make us overlook the fact that it originated in a profound human crisis: the denial of the primacy of the human person! We have created new idols. The worship of the ancient golden calf (cf. Ex 32:1–35) has returned in a new and ruthless guise in the idolatry of money and the dictatorship of an impersonal economy lacking a truly human purpose. The worldwide crisis affecting finance and the economy lays bare their imbalances and, above all, their lack of real concern for human beings; man is reduced to one of his needs alone: consumption.”

So, When do words translate into deeds?

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Jeff Mowatt

Putting people above profit, a profit-for-purpose business #socent #poverty #compassion #peoplecentered #humaneconomy