Daniel Finn holds chairs in both Economics and Theology at St John’s University and the College of St Benedict in Minnesota. He is, therefore, both a representative and exponent of the intellectual tradition within Roman Catholic thought that seeks to apply Christian thinking to economics and business.

Finn has brought together 12 authors to contribute, singly or jointly, to this volume of essays which seeks to explore the moral assessment of business from a Catholic perspective and to do so in a deeper way than the more usual debates around personal integrity or assessments of capitalism and socialism. He argues that such an approach leaves fundamental questions unanswered, although the actual content of those questions is not entirely clear. Nevertheless, this volume presents a series of essays which seeks to address the morality of business within the tradition of Catholic social thought.

The book is divided into three parts. Part one consists of two useful chapters on the perspectives of CEOs and then a reflection on the history of commerce and communion in the history of Christian thought. Part two discusses the internal dynamics of business with three chapters dealing with matters such as agency and the technocratic paradigm. Part three looks at the wider responsibilities of business including approaches to business ethics, the idea of “good goods”, the moral ecology of business and the moral legitimacy of market decisions.

The first chapter gives fascinating insights into the perspectives of three CEOs of companies ranging from a family-owned manufacturing company to a more widely held investment and banking company, one of whom spent many years as a senior executive of a large public company.

These insights are wise, incisive and illuminating. The purpose of business lies at the heart of these senior leaders’ perspectives. Business is intended to meet real needs, profit is essential. However, trust, integrity and quality products are not by-products but central to the mission of their companies. Thomas Holloran noted that during his time with a large public company the shareholders all did very well and yet the company’s mission was not about maximising shareholder wealth. Unsurprisingly, all three opt for a stakeholder model. Although I largely agree with this approach one wonders whether we may have so caricatured the idea of profit maximization that we are in danger of missing some important aspects of the purpose of business. Mary Hirschfield, in chapter 5, dealing with the technocratic paradigm, undertakes a useful exercise in setting out the main arguments in defence of profit maximization as producing socially optimal outcomes in a logical and balanced way (pp95-98). We need more of this honest debate.

All three of the CEOs also emphasised personal responsibility, culture, virtues and the moral qualities of goods and services. Thomas Holloran points out that it is a misconception that most business people are greedy or dishonest. On the contrary, he argues, most are deeply moral (pp22-23). This is an important corrective to the notion that all business is exploitative and business executives are only interested in their own success and profits.

The remaining chapters are somewhat more of a mix tackling important individual subjects but it is not always clear how they relate to the wider picture. Too many of the chapters are stand-alone narratives (albeit with attempts to cross-refer). I would have preferred a more clearly articulated overall vision rather than Daniel Finn’s very brief introduction. However, this is a relatively minor quibble and does not take away from the importance of the collection as a whole.

The strongest chapters are those that reach out further into wider debate.

One example of this is Martin Schlag’s chapter on the responsibility of business for the moral ecology in which they operate (chapter 8). Professor Schlag engages critically with two recent critics of the market, Michael Sandel and Jean Tirole.  Schlag rejects the presumption that markets and morals are in opposition to each other, noting that for Thomas Aquinas, ‘it would be inconceivable to affirm that markets are amoral in their operations’ (p165). Schlag, then, is determined to make us work hard through involvement in the market rather than separation from the market. This is an important theological corrective to the points of view either that business is evil and to be avoided, or that our real calling is to Christianise business. Rather we should view business as part of God’s provision for humanity and a place to exercise Christian character and responsibility. Schlag also builds on Aquinas to remind us that private ownership entails obligations and this includes the owners and ownership of business. In this way business is an integral part of the wider ecology of economic life encouraging the flourishing of all.

Chapter 7, by Daniel Cloutier, dealing with “good goods” is a useful and interesting discussion around the nature of goods. The author identifies three categories of questionable goods, those that are defective, harmful or futile. However, these criteria are negative and not always straightforward (for example, in the case of weaponry). The criteria adopted for futile goods are more instructive. We might purchase futile goods for three reasons, according to the author, the pursuit of luxury, our own self-identification, or consumption as an end itself. The point is that they suggest, “an implied reversal about what is important in life” (page 151). This chapter also discusses the gig economy which sets up some interesting questions. Unfortunately, these are then not pursued leaving the reader feeling rather let down that the analysis had not been extended to a central feature of the modern economy.

One helpful feature of the book is the manner in which the authors of many of the chapters refer back to and locate their observations in the comments of the CEOs in chapter 1. This is a useful link of theory and practice.

I enjoyed this book and recommend it. The chapters were somewhat more disparate than I expected; all were interesting, some were outstanding. We can also give thanks that a group of theologically informed writers are both willing and able to engage with economics and business. Most of what was discussed was relevant to our common Christian tradition.

Daniel Finn asks an appropriate question in his opening sentence, ‘Can a religion whose founder taught love of neighbour as the most fundamental moral principle give moral approval to profit-seeking business firms in a global economy?’ (page 1). As James Heft noted in his Afterword, the CEO interviews reveal that all business leaders “face decisions that are often not black and white and who have to make practical judgments that involve inescapable trade-offs, situations where hard decisions have to be made” (page 222).

Elusive though the answers may remain we should be thankful for this group of scholars exploring these questions and dilemmas. We leave the last word to Professor Schlag:

‘The task of Catholic social thought is neither to be irenic nor cynical but realistic, with a realism that presents constructive, practical solutions not for the righteous but for reasonable people’ (page 174).

“Business Ethics and Catholic Social Thought,” edited by Daniel K Finn was published in 2021 by Georgetown University Press (ISBN: 978-1-64712-074-0). 245pp.

Dr Richard Turnbull is the Director of the Centre for Enterprise, Markets & Ethics (CEME). For more information about Richard please click here.

Much of The Biblical Entrepreneur’s Experience comprises a rather simplistic and selective use of scripture to support a particular world-view, namely a North American free market system. As such, it could almost be categorised as espousing a prosperity gospel, in which correctly following biblical methods will necessarily bring success in business (see Chapter 2 for Davis’s “system”). The examples given in the book, of entrepreneurs such as Sarah Breedlove (Madam C.J. Walker), Strive Masiyiwa and Scott Harrison, tell this story in an often engaging way, but at times verge on a parody, which attempts to represent the complex riches of the Christian faith in an unreflective manner. One example is the song “The Hairdresser’s Ode to Madam C.J. Walker”, to the tune of “Onward, Christian Soldiers”, which the author cites approvingly (pages 72-73). The ‘mission’ of beautifying hair is conflated completely with the great Christian Commission in a manner that I found both disturbing and shallow.

Davis’s central metaphor, akin to a sermon illustration, is that of ‘bees and fleas’, and the author uses the bee/flea imagery to invite the reader into his world-view. BEEs (Biblical Experiential Entrepreneur) are good, and FLEAs (in-Flexible Learnt Entrepreneurial Antagonist) are bad. At the heart of Davis’s analysis is the proposition that “A BEE creates; a FLEA takes” (page 22). The book is peppered with “fun facts”, such as, “The honeybee has a heart!” (page 143), and side-bar notes, for example, “Strive – to devote serious effort or energy; to struggle in opposition” (page 115). Taken together, the above makes the overarching style of the book quite propositional and un-nuanced.

However, at times the book is also informative and every now and again I was pleased to find an interesting comment or statement that, I felt, contributed in a thoughtful way to a theological consideration of the subjects of enterprise and of entrepreneurial behaviour. For example, on the theme of entrepreneurial endeavour, Davis suggests: “It is to prepare the entrepreneur for the next life: a venture more fulfilling than its worldly counterparts” (page 5). This statement sketches out an idea which could be developed into some deep vocational thinking on the kingdom of heaven, and the place for enterprise within God’s enduring purposes. In another intriguing statement Davis comments: ‘…through grace we are given a great opportunity to provide others with a needed product or service to glorify Him – not ourselves” (page 11). Here, the themes of God’s grace, human need (not desire), and divine glory are all connected together under the umbrella of enterprise.

In Chapter 6 biblical examples are used to support the practice of “active listening”, as a way of harnessing God’s messages imparted through others, and Davis interestingly adds some thoughts about the challenges of fear and pride (pages 46-47). This “active listening” to others is to be set alongside the need for regular meditation on scripture (Chapter 15), not mere uncritical proof-texting, which appears elsewhere in the book. Separately, Chapter 10 plays with the “beehive” imagery and the way hexagons fit together perfectly, an illustration of how a project should work, a line of discussion that concludes with this communitarian statement: “…an individual cannot save the world; however a swarm of BEEs in each city can rebuild areas, then blocks of areas, followed quickly throughout a city. Multiple cities make up a country. Multiple countries make up a region. Multiple regions make up the world” (page 104).

A different book might have taken some of these statements and developed them by placing them alongside (and sometimes in tension with) the thinking set out by other authors who have considered the place for enterprise within the Christian world-view. The reader is left to do this work for themself. For example, the rich and in my mind helpful concept of the vocation of the entrepreneur, as proposed by Davis, could have been explored within a more general discussion on vocational calling, and specifically the nature of work within God’s providence.

In a way, the most inspiring section of this book for me was Section 6 (Chapters 16, 17 and 18), which describes empirical research about the distinctiveness of Christian-led and Christian-inspired businesses. Such enterprises typically have greater productivity, staff loyalty, and general outperformance. In this regard, I found the story of Walker Mowers engaging, not least the way in which the owners and directors of this business deliberately attempt to tell the story of the company within the bigger context of the story of salvation history (page 155). An enterprise is thus no longer a means to an end (profit), but is part of an over-arching narrative that embraces God’s purposes. This theme alone could have been developed into a major piece of thinking that I believe would be incredibly timely and helpful for business in today’s world.

In sum, this is a “popular” rather than “scholarly” book. It is, in the main, an easy read with occasional thought-provoking nuggets. With rather less “prosperity gospel” and rather more theological reflection on the important themes that are hinted at, it would have been much improved upon.

“The Biblical Entrepreneur’s Experience” by S Leigh Davis was published in 2021 by River Birch Press (ISBN-13: 9781951561802).  260pp.

Edward Carter is Vicar of St Peter Mancroft Church in Norwich, having previously been the Canon Theologian at Chelmsford Cathedral, a parish priest in Oxfordshire, a Minor Canon at St George’s Windsor and a curate in Norwich. Prior to ordination he worked for small companies and ran his own business.

He chairs the Church Investors Group, an ecumenical body that represents over £10bn of church money, and which engages with a wide range of publicly listed companies on ethical issues. His research interests include the theology of enterprise and of competition, and his hobbies include board-games, volleyball and film-making. He is married to Sarah and they have two adult sons.

Some of the toughest and most complex challenges faced by businesses and corporations in today’s world involve ethics and morality. This is in part why the study of business ethics has now become central in MBA and other programmes.  But the very complexity of these challenges, in an increasingly pluralized as well as globalized world, present a danger that companies lose sight of the big picture – failing to see the wood for the trees.

Lutge and Uhl seek to assist here by providing a comprehensive overview of the essential concepts of business ethics related to the economy as a whole.  At the same time, they offer a wide-ranging analysis of the issues and tools that corporations need to be aware of as they consider the ethical and moral dimensions of their activities.  So, this book – Business Ethics: An Economically Informed Perspective – is distinctive and helpful in the comprehensiveness of what it offers.

Lutge and Uhl are German-based scholars who evidently have deep knowledge in these very important areas – which cover a wide range of academic disciplines.  The quality of their English writing is very good, and the book will be a valuable resource both for companies (especially medium-size and large companies), as well as individuals who have senior-level responsibility.

The authors sometimes refer to their book as a ‘textbook’. However, my impression is that is more of a comprehensive survey than a teaching book as such.

Chapter 1 sets the scene by discussing briefly the phenomenon of globalization. The authors argue that globalization poses a challenge to virtue ethics: “It is an enormous challenge to find some plausible common ground” for a meaningful ethical dialogue “if a common denominator of values does not exist” (pages 13-14).  The authors propose that a more helpful approach is offered by order ethics: the focus here is more on rules than on values.  “The key idea of order ethics is to look out for strategies on the level of rules that enable win-win solutions for all affected parties” (page 14).  The authors return to this emphasis a number of times.

Chapter 2 provides a brief analysis of the relationship between ethics and economics. The authors interpret business ethics as ethics with an economic method.  This links to the book’s subtitle: An Economically Informed Approach. Lutge and Uhl argue that, from the point of view of business ethics, “production and distribution should be recognized as interdependent and therefore only discussed simultaneously” (page 26).  Similarly, “it is only in the interplay of ethical reflection and economically informed implementation that rules and institutions can be created that are resistant to exploitation and mutually beneficial” (page 31).

Chapter 3 surveys the development of business ethics thinking in the historical context of the distinction between premodern and modern companies. The authors include a brief survey of ethical teaching in the Bible and Christian thought, as well as Hinduism and Islam. They argue that the complexity of the 21^st century world means that it is insufficient to have an ethics of behaviour: one must also think about the ‘ethics of conditions’, by which they mean the rules of competition (page 52). This chapter makes a strong case for the benefits of markets and competition.  It also argues that business ethics can to some degree be regarded as a form of risk management.  “Especially in an information society…it is in the company’s own interest not to ignore the moral dimension of its own actions” (page 37).

Chapter 4 is a more lengthy survey of key models and tools of business ethics and corporate ethics.  It consists of three sections: the first looks at philosophical foundations and tools, such as deontology and consequentialism and contractual concepts (e.g., the work of Hobbes, Kant and Rawls). The second section focuses on economic and social-science foundations and tools, such as the rational actor, dilemma structures (e.g., the ‘Prisoners’ Dilemma’) and the concept of utility.  These tools are applied to concepts of justice. The third section deals with psychological foundations and tools.  Major subjects considered here include the social intuitionist model of moral judgment and the concept of bounded ethicality: a perhaps unfortunate piece of jargon which essentially refers to the study of how and why ethical decision-making can be inconsistent and thus problematic – both on the part of individuals and organizations.

It would be fair to say that the evident breadth and depth of Chapter 4 means that it is not easy reading. But this chapter does illustrate the usefulness of the book as a comprehensive survey, and thus a tool for reference and reflection.

Chapter 5 looks in depth at some of the challenges of the modern globalized world, and seeks to show how these impinge on business ethics.  This chapter considers absolute poverty and relative poverty, and then evaluates the extent to which equality is a valid goal, in ethical terms.  The authors’ overall approach is reflected in the following words: “It does not make sense to construct a fundamental trade-off between freedom and equality.  Rather, there should be a search for win-win opportunities that improve all parts of society so that no group feels systematically left behind” (page 168).

Chapter 6 is the last and most comprehensive chapter in the book, and addresses a number of aspects of corporate ethics.  In doing so, it pays due attention to the fact that companies are key players in the globalized world.  Again, this book is seen to offer a very important survey of material and perspectives that are vital, especially for larger corporations.  A number of case studies are provided (in this and other chapters) which help to highlight the practical nature of the challenges and ethical issues.

Chapter 6 provides a detailed analysis of compliance – as a minimum ethical requirement – including the limits of compliance.  It then considers different perspectives on corporate responsibility, including the relationship between profit-maximization and ethical responsibility, and corporate ethics based on the role of ‘the honourable gentleman’ – this latter approach having been recently revived through, for example, the Harvard Business School: “As one of the world’s top management schools, it is providing a prominent stage for individualistic concepts and moral codes” based on honour (page 237).  The authors are, however, sceptical and critical of this development: the question arises as to how such an approach “can be implemented in concrete terms in the context of value pluralism. Even if it were possible to agree on certain values – at least within a certain cultural sphere – there would be obvious disparities in the actual evaluation and respective weighting of particular actions” (page 238).

The authors argue, instead, that the complexity of the modern world “requires the implementation of ethical values in the form of rules and institutions” (page 239).  However, it would seem that further thought is required here: unless there really is some given moral foundation for behaviour and conduct – such as that provided by the Christian faith – then any “implementation” of ethical values is ultimately lacking in foundation.  Even though today’s world evidently exhibits some degree of moral pluralism – and hence relativism – it is still surely possible to draw people together to engage in meaningful conversation about what is right and just.

Chapter 6 concludes with a survey of concepts of corporate social responsibility, including the importance of guarding against reputational risk and loss that can arise if companies fail to act in line with ethical principles. Once again, this illustrates the usefulness of the book as a comprehensive reference, to help guide companies, and those who have senior responsibility, through the complexities that surround business ethics.

“Business Ethics: An Economically Informed Perspective” by Christopher Lutge and Matthias Uhl was published in 2021 by Oxford: Oxford University Press (ISBN 978-0-19-886477-6). 353pp.

Revd Dr Andy Hartropp is an economist, theologian and church minister.  He has two PhDs, one in Economics and one in Christian Ethics.  He lectured in financial economics for 5 years at Brunel University, west London.  He also worked for a year with the Jubilee Centre in Cambridge, primarily leading a team doing research on families in debt.  He trained at Oak Hill College, London, for ordained ministry in the Church of England.  His (second) PhD was published as: What is Economic Justice?  Biblical and secular perspectives contrasted (Carlisle: Paternoster, 2007).  He has spent 13 years in parish ministry.  He worked for eight years with the Oxford Centre for Mission Studies, where he was the Sundo Kim Research Tutor in Mission and Economics.  In March 2016 he joined Waverley Abbey College as Director of Higher Education.  He chairs the Ethics and Social Theology Group of the Tyndale Fellowship.  He is married to Claire, and they live in Bicester, near Oxford.

Jeremias Prassl is a Fellow of Magdalen College and an Associate Professor in the Faculty of Law at Oxford University. He advises public and private sector organisations on regulating the gig economy. In his book entitled Humans as a Service, Prassl re-evaluates the merits and pitfalls of the “gig economy” and seeks to discover ways that society might benefit from the gig economy without falling into “extreme forms” of labour force commodification (page 4).

For those of you wondering what the “gig economy” is, Prassl describes it as “…an ever-growing number of start-ups, […] online platforms and mobile apps [that] connect consumers, businesses, and workers – often for jobs lasting no longer than a few minutes” (page 2). The term “gig” invokes an artist’s gig for a time-limited and (usually) one-off performance.

This new and growing space labelled as the “gig economy” poses both opportunities and challenges.  On one hand the digital space has enabled an unparalleled level of growth and innovation in the exchange of goods, services and other forms of capital at instant speeds – creating value for all participants (page 3). On the other hand, critics argue that a deregulated gig economy leads to a commodification of labour whereby “those with money will be able to […] hire those without money by forcing an online bidding war to see who will charge the least for their labour” (Ibid.).

The book seems to be written with the “educated reader” in mind. The author makes extensive use of practical examples whilst limiting overuse of legal jargon, which makes the book accessible to the specialist and non-specialist alike. The contents are structured among six main chapters and while we will not detail each in part here, we will touch upon some of the key points that may warrant further discussion.

Chapters I and II lay out the foundations of the gig economy: its internal workings, the role of digitalisation, the role of regulation (or lack thereof), and so on. Prassl points out that large actors within the gig economy are mistakenly given the benefit of the doubt when found guilty of mistreating their employees (or contractors). This is largely done by hiding under the “innovation” banner and perhaps abusing the public’s perception of innovation as a natural industry disruptor. Once section in the second chapter highlights the discrepancy between the authorities’ response to Mike Ashley’s Sports Direct zero-hours contracts scandal, and the ill treatment of ride sharing drivers for Lyft & Co. in the US (page 41-42). Prassl asks, “Why, then, is it that Mike Ashley was (rightly) subjected to parliamentary humiliation, whereas the sharing economy is celebrated by its very own cross-party caucus in the US Congress?” (Ibid.).

Chapters III and IV continue the discussion and look at life within the gig economy and the dilemmas that innovation can give rise to, particularly in respect to applying the appropriate level of regulation. Prassl points out an “innovation paradox”: “…it is undoubtedly true that key elements behind the rise of the sharing economy are completely new – first and foremost, their reliance on the internet, smartphone apps and digital platforms […] When it comes to work in the on-demand economy, on the other hand, the story is a very different one” (page 72). It is the capacity to accurately differentiate between the truly novel and the outwardly novel that policymakers will need if they are to develop an appropriate regulatory framework.

Chapters V and VI conclude the discussion by looking at various approaches of harnessing the benefits of the gig economy whilst restoring and protecting workers’ rights. Prassl argues that a key element is ensuring that everyone plays by the same rules, “…we need to redress structural imbalances and create a level playing field – with employment law at its foundation” (page 119).

To conclude, Humans as a Service by Jeremias Prassl is a great overview of the opportunities and challenges that the gig economy brings for all stakeholders involved. However, (and given that this piece of work is primarily written from a legal perspective), one cannot help but feel that insufficient voice has been given to the non-legal (or non-regulatory) solutions to the problems facing the gig economy. Some of these might include: allowing for market corrections and re-structuring, online reputation management, the implications of reputation damage, the increasing role of independent reviews in online decision-making, and so on. This would encompass a much broader discussion that the book sorely misses.

That is not to say these are unequivocal answers – yet a more thorough investigation into the non-regulatory means of transforming the gig economy would have benefited the book greatly. If readers can look beyond the “regulation is the answer” approach (which no doubt, some will), Humans as a Service is a good and informative read. It is just a shame that it missed the opportunity of being an excellent read. Perhaps an economist’s response to the book would help – let’s hope that we see such endeavour in the future.

Prassl, Jeremias. “Humans as a Service: The Promise and Perils of Work in the Gig Economy” was first published in 2018 by Oxford University Press (ISBN:9780192517388). 199pp.

Andrei E. Rogobete is the Associate Director of  the Centre for Enterprise, Markets & Ethics. For more information about Andrei please click here.

This book is the product of an extensive research programme undertaken between Mars Catalyst, which is the internal think-tank of the Mars company, and the Saïd Business School at the University of Oxford. Professor Colin Mayer is a leading voice in the debates around business purpose and has written and spoken extensively in the field. His previous writing in this area includes Firm Commitment (OUP, 2013), and Prosperity (OUP, 2018). He is insightful and measured and this comes through in this volume. Bruno Roche was formerly the chief economist of Mars, Inc. and the head of Mars Catalyst. He brings both practical business experience and a commitment to thinking about and developing both the ideas and practices around business purpose. He developed the idea of the ‘economics of mutuality’ a surprisingly confusing concept, but one with a lengthy history in Mars. A fascinating and interesting project.

The book has four parts. The first deals with consists of an introduction and overview by the editors. Part II consists of seventeen contributions designed to deal with the core components of the ‘economics of mutuality’ including reflections on purpose, various aspects of non-financial capital (human capital, natural capital, social capital), accounting and measurement issues and the role of micro-equity, investment funds, partnerships, NGO activism and other matters. Part III includes 14 case studies and then Part IV is a conclusion.

The book contains some significant insights, offering areas for further research and useful debates on important topics, all of which build on current knowledge and research in this increasingly important area. However, the book seeks to achieve far too much and consequently ends up with disconnects between the debates in Part II and the subsequently case studies.

The book’s premise is that the classic Chicago economic model of profit/shareholder value maximization was misconceived in its very nature but that business is in a position to be a profitable force for good that transcends self-interest ‘for the benefit of people, planet and profit’ (page 4) which is labelled mutuality. There are merits, as well as flaws, in the Chicago model but few would argue with the second part of that statement.

The history of the idea of mutuality as it relates to Mars is set out by Jay Jakub in chapter 4. Forrest Mars Snr wrote, in a 1947 letter, that the aim of the company (page 57) ‘is the manufacture and distribution of food products in such manner as to promote a mutuality of service and benefits,’ listing consumers, suppliers, competitors, government, suppliers, employees and shareholders as all sharing in this mutuality.

The economics of mutuality takes specific account of a wider range of impacts on people and planet, not least through embracing human, social and natural capital (chapters 10-13). The term ‘economics of mutuality’ though is confusing. The ideas extend beyond the ideas of mutual ownership (see chapter 17) but that is what most people will immediately think of and hence might be distracted from the wider argument. The terminology cannot be readily grasped.  There remains a distinct vagueness when discussing the range and measurement of alternative forms of capital. The editors define mutuality as involving trust, a wider and more pragmatic view of the firm, measuring non-financial performance and developing simple metrics and reporting. The book would have carried more coherence if this definition had more clearly formed the shape of the book and then developed in the case studies. This would have given both a sharper and yet more in-depth analysis.

At the heart of the argument is the idea that the effective boundaries of the firm should be extended beyond the contractual definitions of the traditional corporation which then enables the establishment and pursuit of wider purposes. This argument merits much more discussion as it is a genuinely innovative and creative idea. Colin Mayer and Bruno Roche argue, ‘companies are part of larger business ecosystems and as such, have responsibilities to individuals, communities, and resources that contribute to business performance’ (page 14).  Few would disagree with that and yet extending the boundaries of the firm poses challenges for the structure and nature of the corporation and there remain several conundrums. What is the legal structure which will shape the future corporation? How will the various contractual relationships be reflected in that structure? Are there different possibilities for public, private and family companies?

Another area of significance identified and certainly in need of further research is the development of metrics of measurement for the wider range of capitals identified leading to the idea of a mutual profit and loss account. Chapters 13, 14 and 15 dealing with accounting for natural capital (Richard Barker), implementing a mutual profit and loss account (Robert Eccles and Francois Laurent) and the impact of mutual profit on business behaviour (Robert Eccles and Judith C. Stroehle) were all excellent chapters pushing at the boundaries. Yet, it remained theoretical. One was left wondering whether anyone had actually implemented this sort of accounting approach. As Eccles and Laurent note, to be ‘meaningful and effective, the mutual P&L relies on the selection of material issues and initiatives, the right metrics, and a certain degree of stability over time’ (page 197). This is essentially a rather vague and highly subjective set of criteria; accounting and measurement, however, depends on objective criteria. No concrete examples were actually given and the idea was not explored in the case study section.

The case studies are all examples of businesses which pursue wider purposes and objectives for the good of society, for people, for planet and also for profit. The examples range from supply change management, micro-equity initiatives, fair trade, alleviation of poverty and specific examples of business eco-systems designed for the good of society. Some are well-known. All are good, even inspiring examples of profitable business for good. What was much more difficult was to see the specific (rather than general) link between the earlier chapters and the case studies.

Overall this book is a helpful contribution to the wider debates and draws on a number of important areas for further development and future research. The question remains of how business, mainstream commercial business, can be refocussed in positive ways for the benefit of the various mutually inter-dependent players, rather than simply some good examples of business for good. This requires a more focused approach, reflection on legal structures, their limits and boundaries, and how to reflect new structures as well as the issues of measurement and reporting across a wider range of metrics.

Putting Purpose into Practice: The Economics of Mutuality, edited by Colin Mayer and Bruno Roche was published in 2021 by Oxford University Press (ISBN: 978-0-19-887070-8). 404pp.

This book is a collection of eighteen separate but thematically connected papers which were given at an international academic conference in Belgium in May 2018. The organising principle is an enquiry as to whether the ‘will to serve’ must always be ‘crowded out in the real economic arena of hard competition’ (page vi). The authors are very diverse, with global perspectives offered, although there is an inevitable impression at certain moments that one is eavesdropping on a room full of academics talking to one another and there is some repetition, notably when it comes to the description of what ‘servant leadership’ might be.

I found some of the papers stronger than others but I enjoyed reading all of them, and was left with ideas and questions about re-discovering a wider view of how businesses and companies operate within society. Originally the granting of ‘limited liability’ was seen as a privilege that brought responsibilities towards the community. Those responsibilities have at times been largely overlooked in the single-minded search for profit, which in turn has shaped the kind of leadership the corporate sector has embraced and this volume is a helpful contribution to a growing literature that urges a wider view of what makes for good leadership (whether described using ‘servant’ language or not), as well as a broader view of the very purpose of business and enterprise itself.

It is difficult to summarise such a diverse set of essays, and even the over-arching theme of servant leadership seemed not to be dominant. There are three sections: (1) Philosophical and Spiritual Foundations; (2) Social Entrepreneurship: Serving the Common Good; (3) Servant Leadership in the Context of Business. The general movement through the collection is from concepts to practice, although there is plenty of overlap.

Section 1 (Philosophical and Spiritual Foundations)

I found the most thought provoking of the seven essays in Section 1 to be Ipseistic Ethics Beyond Moralism: Rooting the “Will to Serve” in “The Reverence for Life” by Chris Doude van Troostwijk and The Dark Side of Servant Leadership: Power Abuse via Serving by Volker Kessler. 

Despite its title, the former is very readable. It uses Albert Schweitzer’s life-story as a vehicle for the author’s argument, which is an attempt to answer this question: ‘Is there a way that respects both the self-centered impetus of human life and the altruistic needs of life in general?’ (page 82) I was especially intrigued by the author’s appropriation of Darwin’s ‘survival of the fittest’ theme so as to re-evaluate ‘fit’ as a social idea – the cooperation needed for someone to be a ‘good fit’ within an organisation.

Volker Kessler’s paper contrasts strongly with the others, in that the author (a practitioner with his wife Martina) draws upon a data-base of stories to describe eight mechanisms of power abuse in Christian organisations. The main issues are those of inappropriate obligations and commitments, and a culture of dependency masked as being reciprocity. This sentence stood out for me: ‘Many of the misuses listed… could be avoided if leaders would not call themselves servants.’ (page 119) Every Christian leader would benefit from reading and reflecting on this article.

Several of the other essays are also interesting. Two take a Christian perspective: Patrick Nullens’ paper (The Will to Serve: An Anthropological and Spiritual Foundation for Leadership) looks at the moral aspects of servant leadership, and makes theological links to Christian love and Christ the servant/slave. Nullens raises human fallenness, and therefore the need also for justice – a wider concept linked to the common good; and Heiko Wenzel’s essay (Reading Exodus 18 and Robert Greenleaf) refers to Exodus 18 (Moses’ leadership) as a way of exploring the differences between hierarchical leadership and a ‘first among equals’ model. Issues of organisational culture and participation, and how they are shaped, are considered. In contrast, in Simone Weil and a Critical Will to Serve Michael J. Thate draws on Simone Weil’s thought, in which the theme of ‘creative attention’ is prominent – this being attention towards the world, and a kind of ethical awareness that avoids rigidity.

The other two essays in Section 1 are disappointing. First, Servant Leadership Beyond Servant and Leader: A Buddhist Perspective on the Theory and Practice of Servant Leadership by Ernest C. H. Ng sketches out a model called ‘Interdependent Leadership’. This suggests that changes can be delivered only when confronting thoughts are transcended and any place for opposites or ‘contest’ is removed, but I struggled with understanding how this analysis might become a practical tool.  Secondly, Christianity and Servant Leadership by Peirong Lin among other things considers the concept of the ‘leadership moment’ (page 124), and the need to hold leader, follower, purpose and context together. I liked the phrase, ‘Normal things have parable character’ (page 135), borrowed from Dutch priest and professor Tjeu van Knippenberg, but overall this article felt fairly general to me.

Section 2 (Social Entrepreneurship: Serving the Common Good)

All six essays in Section 2 provoke thought, especially for Christians. The section opens with Emilio Di Somma pushing back against the Milton Friedman version of economics, and seeking to find a place for power-relations, politics, and human dignity within the discussion (Protecting the Weak and Creating Community). Serving is therefore mainly characterised as relinquishing power, and the example of Adriano Olivetti as an exemplary and socially responsible entrepreneur is used. I found myself arriving at the interesting conclusion that ‘making things well’ might be more important than making a profit, although the two are of course not mutually exclusive.

Foundations for Social Entrepreneurship: An Integrative Indian Perspective by Sharda S. Nandram, Puneet K. Bindlish, Harsh Purohit, Ankur Joshi, & Priti Hingorani explores the idea that entrepreneurs might be drawn towards social entrepreneurial activities because of themes lying within Indian philosophy. There is some methodology and interpretation, although I was left wanting more of this. The most interesting concept is that of the ‘public domain’, and why some entrepreneurs seem willing to gift their ideas and creativity to the world, for example Tim Berners-Lee and the world wide web.

Workplace Spirituality in Social Entrepreneurship: Motivation for Serving in the Common Good by Natasha Gjorevska describes ‘spiritual entrepreneurs’ as a category, and explores a complementary relationship between the concepts of social enterprise and workplace spiritual leadership. ‘Spiritual’ here is not necessarily ‘religious’, but embraces themes such as ‘meaningful work’, ‘purpose’, and a ‘sense of community’. However, there are plenty of resonances with Christian thinking about vocation, and the common good.

Mindful Servant Leadership for B-Corps by Kevin Jackson provides some helpful (for me) background information about B-Corps, which are essentially public benefit companies that also exhibit non-instrumental motivations: ‘…ethics for their own sake…’ (p.213). The other main strand within this paper concerns ‘mindfulness’, which keeps a leader’s view wide, and therefore overlaps with the bigger societal purposes of a B-Corp. I translated this for myself into a Christian understanding of prayerfulness, and the big-picture view of creation, and new creation in Christ. With a bit of interpretation this article would be of interest to Christian business leaders and entrepreneurs as they look to the wider purposes of their organisation.

In The Religious Leader as Social Entrepreneur, Jack Barentsen begins by raising the concern that an apparently ‘servant’ religious leader might only or mainly be motivated by the need to proselytise. However, the argument is put that this is usually not the case, and that a broader view of the common good is in mind. One specific example is peacebuilding. Barentsen notes the well-known fact that people of faith are much more likely to volunteer (‘serve’), and therefore contribute to social capital, and he has a useful section, albeit descriptive rather than analytical, on religious leaders as entrepreneurs. I liked his final question asking, are religious leaders helped and trained to be social entrepreneurs, or common-good-builders. My sense is that in the church I belong to the answer is, ‘No’.

Serving the Poor: The Case of the EoC Enterprise ‘Mercurio Net’ by Mara Del Baldo & Maria-Gabriella Baldarelli is very different from the other essays. EoC stands for ‘Economy of Communion’, which is a network of companies initiated in Brazil in 1991 by Chiara Lubich, and which connects to the Roman Catholic Focolare Movement. Lubich’s vision was based on reducing poverty and the need for a broad understanding of happiness and ‘human flowering’. (page 256) She wanted to see a new generation of companies producing wealth on behalf of those in poverty by providing good work. The authors tell us that there are now almost 1,000 EoC firms around the world. I knew none of this, and was grateful to learn, as well as being reminded that the place for servant leadership is critical when it comes to an attentiveness to the poor.

Section 3 (Servant Leadership in the Context of Business)

The third section of the book begins with Jakob Willem (Pim) Boven’s observation (with which I agree) that a theory of leadership (entrepreneurship) is very under-represented in the standard neo-classical economic theories (Servant Leadership in Market-Oriented Organizations, Does that Make Sense? An Evaluation from an Economic-Organization Theory Perspective). The author therefore suggests that we need to take seriously the institutional reality of the company, and he points us to the growing body of research into Organizational Economics. His main point is that there are resonances between Organizational Economics and the theme of ‘Servant Leadership’.

The next two essays in this final section seek to learn from specific situations. The first, The Importance of Calling in Realization of Life Projects: The Case of Maverick and Serial-entrepreneur Hans Nielsen Hauge with Implications for Business Education by Knut Ims, Truls Liland, & Magne Supphellen is the more analytical.  It is essentially a very interesting case study of Hans Nielsen Hauge (1771-1824), who was an influential entrepreneur in Norway – a preacher and businessman whose impact is still felt today. I did not know his story before reading this article, and found it inspiring. Of note for me was the feudal context out of which Hauge sprang, and which he implicitly challenged, as was the link between the spiritual experience of his ‘call’ (described on page 313) and his practical entrepreneurship. The authors point to these key ingredients in Hauge’s life: self-determination (an intrinsic motivation); meaning; persistence. These combine to give prominence to a holistic view of life, rather than life as a series of attempts to optimise choices. This rallying cry towards the end of the paper seemed powerful and important to me: ‘We need a type of business education and business training, which assists students in defining life goals and life projects.’ (page 325).

Rethinking Fashion Retail: The Case of MrSale by Gabor Kovacs takes the form of a qualitative mini research project focused on a small private company called MrSale, which was founded in Budapest in 2000. Kovacs is seeking evidence about the source of genuine ethical commitment in business. The answer is to do with the motivations of serving society and contributing to social well-being, with a link to meditation and Buddhism. The often-observed benefits of an ethically run business are, in this case, seen to be those of satisfied employees, increased innovation, higher levels of trust with suppliers, growth, and ultimately profits. Case studies are always engaging, but I was hoping for more critical comment and interpretation.

The final two essays consider the thinking of two very different people: Aldous Huxley, who was famously the author of Brave New World in 1932, which took a pessimistic view of the rise of science and a mechanised economy; and John Wesley the prophetic teacher and preacher, who created a large-scale business and who had links to the world of commerce and trade.

In Aldous Huxley’s Anarchist Entrepreneurship Based on Spiritual Capital, Gerrit De Vylder plays Huxley’s fiction off against the theme of servant leadership – a creative endeavour which yields surprisingly rich results. The idea which most caught my eye was the value ascribed to localism and the link to the ‘small is beautiful’ economics of E.F. Schumacher. This paper, and indeed the entire book, pre-dates the covid-19 pandemic, but I wondered if the new post-pandemic desire to build more resilient supply chains and to reduce dependence on global trade routes might have added to the discussion.

In the final chapter of the collection (John Wesley: Prophet and Entrepreneur), Clive Murray Norris gives a concise description of John Wesley’s ministry and observes that Wesley’s prophetic voice had a dual focus: personal spiritual renewal, and the need to address the problems and injustices faced by society. This in turn meant that Wesley avoided the trap of a ‘prosperity gospel’, and instead demonstrated a strong sense of stewardship and the fruitfulness of good works in a broad, societal sense. My knowledge of John Wesley’s activities was improved by reading this paper, and the conclusion, with four points for reflection aimed at today’s social entrepreneurs, made for a fine ending to the entire book. Summarised, these are: (i) the need for a holistic view of humanity’s spiritual and physical needs; (ii) the desirability of borrowing ideas from others, accepting that not every idea will work, and focusing on practical action; (iii) the importance of having friends and partners across the community, both rich and poor; and (iv) the imperative that all share a common purpose, that all are welcome, that anything is possible, and that action must start now.

“Servant Leadership, Social Entrepreneurship and the Will to Serve – Spiritual Foundations and Business Applications”, edited by Luk Bouckaert and Steven C. van den Heuvel, was published in 2019 by Palgrave Macmillan (ISBN-13: 9783030299385). 394pp.

Edward Carter is Vicar of St Peter Mancroft Church in Norwich, having previously been the Canon Theologian at Chelmsford Cathedral, a parish priest in Oxfordshire, a Minor Canon at St George’s Windsor and a curate in Norwich. Prior to ordination he worked for small companies and ran his own business.

He chairs the Church Investors Group, an ecumenical body that represents over £10bn of church money, and which engages with a wide range of publicly listed companies on ethical issues. His research interests include the theology of enterprise and of competition, and his hobbies include board-games, volleyball and film-making. He is married to Sarah and they have two adult sons.

Reimagining Capitalism: How business can save the world is a very didactic, easy to read book. Unfolding like a captivating lecture, it is highly structured and each point is illustrated with a wealth of business examples taken from a wide spectrum of enterprises, old and new.

You can easily imagine Rebecca Henderson on the campus of the Harvard Business School answering the challenging questions of Millennials who fully embrace sustainability and inclusion topics. The resulting book challenges head-on the paradigm of business management theory over the last fifty years that held shareholder value maximisation as the most powerful way to increase general prosperity. She does not seek to list the shortcomings or fix the problems of the current model, rather, she is more ambitious. Tapping into her considerable experience of business consultancy and her knowledge of history of corporations and national institutions, she builds block by block a path to rethink or Reimagine Capitalism.

She takes stock of Shareholder Value Maximisation theory and highlights that the conditions deemed necessary by its early advocates are not always present: markets fail us because externalities are not properly priced, genuine freedom of opportunity is not available to many because of lack of fair access to education and health services and firms are increasingly able to fix the rules of the game in their favour. Uncontrolled free markets lead people to believe that they can do without government, “without shared social and moral commitments to the health of the entire society” on which however all market activity ultimately relies.

In her effort to build a path to “reimagine capitalism in practice”, she lays out five foundation blocks to lead us on the journey.

Firstly, she tackles the strong economic business case for creating shared value. It is somewhat abstract and ethereal as a theoretical economic concept, however, she effectively uses examples to illustrate how it can manifest itself and its importance in a business context. Reducing environmental damage and treating people well reduce reputational risk. Shared value can also help securing the long-term viability of a supply chain, increase the demand for your product and reduce costs. Achieving shared value however, is not a small feat. To help us project how shared value can be established in a company, she introduces the interesting concept of architectural innovation.

Following this logic, she highlights how the adoption by any enterprise of an authentic purpose “makes it easier to identify the kind of architectural innovations that enable the creation of shared value.” Rejecting the commonly held belief of profits and purpose being mutually exclusive, she sees purpose-driven organisations as better equipped to handle transition in disruptive market conditions. The clear sense of their mission in the world, the commitment to building an organisation in which every employee is treated with dignity and respect “release creativity, commitment and raw energy”. She does not elaborate much on the strong spiritual or political convictions that sustain “the courage and vision of the leaders necessary to manage with purpose” even though she recognises its critical importance.

She then turns her attention to the need for finance to focus on the long-term. Asset owners and asset managers might have a different appetite (and incentives) to hold assets long-term but investors in general need better data to be convinced to hold their interest longer. ESG metrics, especially those with potential significant impact on short-term profitability and long-term liabilities must continue to be rigorously developed and used. While the investment community as a whole may not yet be ready to wholeheartedly embrace the company purpose and ready to give time to its implementation, Rebecca Henderson suggests a possible limitation, even reduction of investor power to the benefit of other stakeholders. Harnessing the power and influence of investors is a key enabler to drive change at scale. The examples she cites demonstrate that this is beginning to happen within the investment community.

However, one company cannot do much on its own about genuine public good problems. Industry-wide self-regulation has been criticised in the past as a way to anticipate and diffuse the threat of government regulations or also to set up barriers to new entrants. Nevertheless, the powerful example of how Unilever and Paul Polman socialized the problem of palm oil sustainability shows that increasing everyone’s incentive to cooperate and being able to enforce cooperation can have a major impact and create collective shared value.

Her last avenue of reflection in Reimagining Capitalism is the role of government as a guarantor and enabler of a free and fair market. “While economic growth and social well-being are often enormously advanced by the presence of free markets, they are also critically dependent on a host of complementary institutions.” Denouncing the systematic campaign of the last 50 years to discredit government in the US, she suggests answers to the fundamental question she raises namely “how do we protect the institutions that have made us rich and free?”

Rebecca Henderson is determined to provide each reader with nothing less than a roadmap to find their own path forward towards changing the world. She is a staunch believer in the positive power of capitalism but is also clear about the dangers of unchecked capitalism, leading to the explosion of inequalities and the raise of populism. While the topics she develops could have justified further ethical considerations, she keeps the debate firmly in the logic of the business case, adopting a rigorous, business-like approach. She manages nevertheless to communicate and share a real passion for the issue at stake. This book is highly topical as demonstrated by the speech on March 15 2021, by the acting chair of the US Securities and Exchange Commission, Allison Lee who stated:

“That supposed distinction—between what’s ‘good’ and what’s profitable, between what’s sustainable environmentally and what’s sustainable economically, between acting in pursuit of the public interest and acting to maximize the bottom line—is increasingly diminished,” Lee told the audience at the liberal think tank Centre for American Progress. “[There’s] no historical precedent for the magnitude of the shift in investor focus that we’ve witnessed over the last decade.”

It is overall a very interesting and relevant book, well worth reading and reflecting upon.

“Reimagining Capitalism: How business can save the world” by Rebecca Henderson was published in 2020 by Portfolio Penguin (ISBN-13: 978-0241379660). 336pp.

Anne Devlin is a director of Terra Solar II, a former oil trader with BP and a member of the Board of CEME.

The sub-title of The World Made Otherwise is “Sustaining Humanity in a Threatened World” and climate change or other environmental issues form the book’s starting point and backdrop. Gorringe sees climate change as creating a burning platform that makes thorough-going political, economic and social change imperative.

His prognosis is dire. He opines that “civilisational collapse is likely” (page 19) and that, together, environmental issues and current socio-political trends “could suggest the ‘new dark ages’ of which MacIntyre spoke nearly 40 years ago” (page 153). He asserts that the resulting problems are primarily moral and political and that “neither technological fixes nor tweaking of the present economic system are sufficient to address them” (page 117). Instead, he thinks that the heart of the problem lies in false values.

Much of Gorringe’s discussion relating to values will be widely applauded: he rejects the post-modern relativism that reduces discussions of values to discussions of psychology or sociology, confusing values with either societal norms or preferences linked to self-realisation; he defends the idea of universal values against those who would deny their existence (including those on the left who suggest that the very idea of human rights is a form of Western cultural imperialism); he also rejects “the claim of the neoliberal market to provide the fundamental standard for everything whatsoever” (page 57) and instead seeks to establish a value system based on the ultimate end or object of human life, which he suggests is, in essence, the creative fulfilment of human potential, “a fulfilment that is both individual and social” (page 85).

His discussion of the problems within the existing political, economic and social order also contains much that will command wide acceptance, albeit not much that is new. In particular, the history of the twentieth century supports the wisdom of his call for “a critical watchfulness” with regards to our political practices and his warning that “all claims for absolute allegiance on the part of the state are idolatrous” (pages 133/134). Likewise, his warning about making an idol of the market will be accepted by all but the most extreme free marketeers and his criticisms of the workings of modern democracies (including the basis on which people cast their vote, the role of the media and lobbying) ring true.

Unfortunately, however, time and again Gorringe gravely overstates his case and, whilst some parts of the book are closely argued, much of what he asserts is not backed up by detailed analysis or engagement with different views. For example, he asserts that “equality must mean equality of outcome” (page 163) on the basis of five lines of argument and he makes no effort to comprehend the practical and moral arguments for the market economy or recognise the different conceptions of justice that underly much current socio-political debate (as to which, see Capitalism and Democracy by Thomas Spragens). Furthermore, the version of the market economy that he attacks is extreme and he fails to acknowledge that one can be in favour of a market economy yet at the same time recognise the need for guiding values outside it. Instead, he makes a number of unsupported ex cathedra assertions that, on occasions, descend into mere left-wing jibes (e.g. his side swipe at “austerity” measures, which he defines as “making sure the bankers do not have to pay for their mistakes”, page 198, and his distinction between “genuine science” and “the spurious corporate-financed variety”, page 290).

The least satisfactory part of the book is its suggestions for change: they are almost totally lacking in specificity and are absurdly Utopian. Gorringe says that he is putting forward what he calls “rights cosmopolitanism”, which he describes as “a vision of a cosmopolitan world of federated states where all people enjoy basic rights and freedoms simply in view of their humanity” (page 147). However, the vision is vague and Gorringe gives no clue as to how it might be realised. He envisages the break-up of current nation states and talks of “a world of small and devolved, but often federated states, where economic and environmental rules would be worked out together and held to be binding by the United Nations and its agencies” (page 152); he suggests that “local economies will have shorter supply chains and keep real wealth within the community” and that they “will not import products they can produce for themselves or export local products until local needs have been met”, citing apparently with approval, Molly Scott Cato’s suggestion that there might be perhaps 20 bioregions forming the basis for a reformed economy with each bioregion having “the task of provisioning its inhabitants” (pages 233/234); and he advocates monetary reform. Yet his political proposals amount to little more than a vague idea relating to the creation of local deliberative assemblies; leaving aside a few specific proposals (e.g. to mutualise utilities and provide a basic citizen’s income), his economic ideas are packed into a bewildering four page section in which he advocates the localisation of economic life; and, apart from discussing a few examples of what are, in essence, local or restricted use currencies, he gives us no clear idea of what monetary reforms he is seeking.

Gorringe defends himself against the charge of being Utopian by suggesting, first, “that nothing is so wildly Utopian as to try and build a sustainable world on the basis of greed and competition” and, secondly, that his proposals “are actually being modelled on the ground the world over” (page 236) but this defence fails. The first of these points has no bearing on the realism of his proposals and the second fails to recognise that the only examples he gives of anything remotely resembling the kind of localised system that he advocates are very small scale and, as he himself recognises, have many problems.

It is difficult to know precisely who the book is aimed at. It is not an academic work yet it is overloaded with quotations from and references to the views of different authors (e.g. the main text in the first five pages of the chapter relating to values includes references to the views of no less than 15 different authors). These come so thick and fast that parts of the book are heavy-going and they are likely to render it inaccessible to many potential readers. Furthermore, Gorringe is a liberal Christian who is heavily influenced by Marxist thinking and these starting points pervade The World Made Otherwise. Gorringe makes no attempt to justify them, with the result is that the book is unlikely to prove persuasive to those who do not share his assumptions. Thus, whilst most Christians will welcome his reminder that God ultimately owns all things (a fact which necessarily relativizes property rights), his approach to Scriptural interpretation will baffle and alarm many. For example, his suggestion that “The Eucharist (when not fetishized) adumbrates as a sign the view that the world is gifted to all creatures and is to be shared equally between them” (page 224) is, to put it mildly, difficult to extract from the biblical text, whilst his assertion that Hebrews 13:14 (“Here we have no abiding city”) “promises us that Rome (which for us is neoliberalism) will not last forever” (page 66) is extraordinary.

Gorringe has, for a long time, passionately believed in the need for radical, political, economic and social change and environmental issues have added to the imperative tone of his appeals for such change. However, passion and urgency do not of themselves make up a viable political programme. Gorringe’s theological villain is clearly St. Augustine of Hippo, who he feels is responsible for generations of Christians believing that “the possibility of a truly different society… belongs only to the next life” (page 67). On this basis, one might expect him to show us the way to an earthly paradise but, despite its title, The World Made Otherwise fails to provide one and, whatever one’s political views, Gorringe’s diagnosis and prognosis are simply depressing.

The World Made Otherwise by Timothy J. Gorringe was published in 2018 by Cascade Books (ISBN: 978-1-5326-4867-0). 348 pp

Richard Godden is a Lawyer and has been a Partner with Linklaters for over 25 years during which time he has advised on a wide range of transactions and issues in various parts of the world. 

Richard’s experience includes his time as Secretary at the UK Takeover Panel and a secondment to Linklaters’ Hong Kong office. He also served as Global Head of Client Sectors, responsible for Linklaters’ industry sector groups, and was a member of the Global Executive Committee.

This documentary is structured around interviews of tech experts who were pioneers at leading social media platforms and who came to realise that something important went wrong at some point. These views are expressed through a fictitious drama showing the impact of social media on the different members of a family. It is easily accessible to non-social media aficionados and articulates issues that most of us have intuitively perceived without being able to find the common thread running through them.

This Netflix documentary opens on a sombre note with an ominous quote from Sophocles, “nothing vast enters the life of mortals without a curse”, which is somewhat disconcerting. Unlike Greek tragedies, The Social Dilemma finishes on a carefully hopeful note whereby with greater awareness of the problem and willingness to discuss the issues, it can be fixed. But what exactly is the problem?

The realisation that the tech industry lost its way, making no room for ethical design or even questioning the moral implications, is clearly linked to the monetisation of the social media platforms. Their business model is unveiled and brought back to its essence: if you’re not paying for the product then you are the product. As Jaron Lanier, the American computer philosophy writer, puts it: “It is the gradual, slight, imperceptible change in your own behaviour and perception that is the product.” And the more you are using the platform, the more data feeds the system and therefore the better the prediction of your action. The picture starts getting really scary when you realise that cognitive psychology, especially how to persuade people, is built into the technology itself, deliberately exploiting vulnerability in human psychology. Tristan Harris puts it powerfully when he highlights that people usually recognise the danger when technology will overwhelm the human intelligence. An earlier moment is, however, perhaps more dangerous, namely when technology overwhelms human weaknesses, overpowering human nature and breeding among other things addiction, polarisation, and radicalisation.

Algorithms are originally programmed to a certain definition of success. If it is to maximise revenue, computer learning will improve and optimise towards that goal with no ethical constraints or concerns. Maximising engagement, growth and advertising targets will make algorithms ruthlessly manipulate our emotions and behaviours without us even being aware of it. As fake news travels six times faster on Twitter than the truth, the system has a bias towards disinformation as it makes more money for the company. A systematically individually customised information flow, designed by algorithms to maximise your engagement or watch time, sows division in society: people cannot hear a different opinion since they are being fed the one side of the story which their profile establishes they want to hear. Polarisation, going down rabbit holes, conspiracy theories, and radicalisation are all common manifestations of technology’s ability to destabilise the fabric of society. While we witness a technology-led assault on democracy, we should also worry about the use of technology by totalitarian regimes.

To conclude, this documentary highlights the fundamental issue that systems of algorithms are void of ethical consideration. Their ultimate goal is to maximise profit. AI cannot know what Truth is but people need to have a common perception of reality in order to live together. The positive note comes from the realisation by the tech experts, spearheaded by Tristan Harris, that they do have a moral responsibility to fix it. That starts with a conversation about what the problem is, which is exactly what this documentary succinctly achieves. It will be a difficult journey since any reform of the system will chart a collision course with the current business model of the powerful social media giants. Technology is a great force for good, but the moral dilemmas raised by the social media platforms need to be addressed transparently.

The Social Dilemma is directed by Jeff Orlowski and was first released on Netflix on 9th September 2020.

Anne Devlin is a director of Terra Solar II, a former oil trader with BP and a member of the Board of CEME.

Are corporations and other business organisations morally responsible for their acts and omissions? The media and popular discourse frequently assume that they are: companies are sometimes said to have “behaved disgracefully” and, in response, they “apologise”; legislators and regulators around the world seek to impose penalties on companies and justify this by reference to their alleged responsibility for wrongdoing.

But is the attribution of moral responsibility justified? Should we regard such attributions as either misconceived or merely a shorthand way of attributing responsibility to individuals within the relevant organisation? Or can one, in some sense, say that an organisation is morally responsible for its actions and, if so, with what consequences? It is these questions that The Moral Responsibility of Firms addresses.

The book originates in a 2013 conference sponsored by the Warton School of the University of Pennsylvania and INSEAD. It comprises essays by twelve authors sandwiched by contributions from the two editors. The authors comprise a distinguished array of academics from a variety of disciplines (ethics, philosophy, law, business and politics) and the editors line them up in three groups: four essays (by a total of five authors) set forth the arguments in favour of attributing moral responsibility; four (again having five authors) set forth the arguments against; and, finally, two (each with a single author) seek to point a way forward for the debate.

All the essays are of a high standard and, although they comprise serious academic work, their arguments are accessible to any educated reader who is prepared to take the time to study them carefully. Some of the authors could have used less dense language (Michael Bratman being a particular offender is this respect) and some (e.g. Philip Pettit) unhelpfully cross refer to their previous work in order to save space but these failings do not act as a serious barrier to comprehension.

Readers may find the US bias of the authors frustrating but, although a few of the issues discussed are very US specific (e.g. the question corporations are persons entitled to benefit from rights under the US constitution), these discussions are brief and the vast majority of the book is devoted to issues that are applicable to the situations in other countries. Furthermore, the authors make good use of recent corporate history to illustrate the points that they are making and the events that they refer to are generally widely known outside the USA (e.g. the Deepwater Horizon explosion and oil spill that cost BP Plc a huge amount of money and the Herald of Free Enterprise disaster).

There are two basic approaches to the attribution of moral responsibility. The first, a metaphysical approach, is adopted by Pettit. He argues that corporations (and, indeed, many other organisations and human groups) are “conversable agents”, by which he means that “in normal unrigged circumstances [a corporation] maintains certain purposes, forms reliable representations of its environment, and acts reliably so as to satisfy its purposes according to those representations” (page 17) and “corporations can use words as the means of forming their purposes and representations” (page 19). In short, he suggests that corporations are analogous to human beings in relation to the things that he considers matter for the attribution of moral responsibility.

Bratman and Peter French agree with this. Bratman argues that a group may be held responsible for its actions even in circumstances which there is no shared intention among members of the group, whilst French suggests that the moral responsibility of an organisation may vary over time as its composition and “self-told narrative” changes.

In contrast, Waheed Hussain and Joakim Sandberg arrive at the attribution of moral responsibility by means of what they call “normative functionalism” rather than metaphysics. They expressly reject “pre-institutional” corporate moral agency (i.e. Pettit’s approach, page 66) and argue in favour of attribution of moral responsibility by asking “what forms of treatment for business corporations would serve the justifying aims of the competitive market” (page 67). Pursuing this pragmatic, positivist view of moral responsibility, they suggest that “issues about when and how to treat groups of individuals as collective agents are best understood as interpretative questions about specific social practices” (page 75). Hence, “there is no one right way to treat a group of individuals as a collective agent: different forms of treatment are appropriate in different domains and contexts” (page 76).

The authors who oppose the attribution of moral responsibility also display a diversity of approaches. For example, John Hasnas is prepared to assume that Pettit has established that corporations can be held morally responsible and he thus focuses on whether they should be, but others are less reticent. David Rönnegard and Manuel Velasquez confront Pettit’s arguments head on; Amy Sepinwall argues that blame is only appropriate in relation to those who can feel guilt and experience punishment, which a corporation cannot; and Ian Maitland trenchantly says, “I have carefully avoided entering the debate over the metaphysical or ontological status of the corporation or other collective actors. That way lies madness” (page 119).

Nonetheless, there are common themes that emerge from the essays of those in the “anti” camp. Maitland speaks for them all when he says that “the anthropomorphization of the corporation has become a source of mischief, manipulation, or abuse” (page 106) and they share a strong belief that the responsibility deficit that Pettit fears would exist if corporations were not held to be morally responsible is illusory. It is, to use Hasnas’s term, a “phantom menace” (page 94). Having examined Pettit’s arguments, Hasnas suggests that they would only hold good if the inability to assign moral responsibility to corporations precluded the assignment of any kind of responsibility. This, he points out, is patently not the case since “Moral responsibility is not a pre-requisite for the assignment of civil, administrative, or ‘metaphorical’ responsibility” (page 95).

Underlying this is a wider issue: some of the authors (e.g. Hussain and Sandberg) use the terms “moral responsibility” or “responsibility” remarkably loosely. They sometimes appear to drift into confusing legal responsibility for moral responsibility and, within the category of legal responsibility, fail to distinguish between different kinds of liability (e.g. strict, “no blame” liability versus liability based upon attributed blame and criminal versus civil liability).

These confusions disguise the fact that the authors who favour the attribution of moral responsibility fail to explain exactly what they believe the practical consequences of that attribution would be. Hasnas recognises this issue and suggests that the only practical implication would be the attribution of criminal liability. However, even this concedes too much: there is no reason why moral responsibility and criminal responsibility should be linked in this way. The criminal law does not view moral responsibility as being a necessary requirement for the imposition of liability (c.f. strict liability offences such as many motoring offences) and, in any event, the moral responsibility of an individual may be, and sometimes is, attributed to a corporation for the purposes of criminal law (c.f. the English law of fraud). It is, in fact, difficult to see that there is any practical outcome for which the imposition of moral responsibility on corporations is either a necessary or a sufficient pre-condition.

The book is not without failings. In particular, the final two chapters (by Kendy Hess and Nien-Hê Hsieh) are disappointing. They are presented as an attempt to synthesize the points made by others, to demonstrate a substantial measure of agreement between the two opposing positions and to point a way forward for the debate. However, both authors are proponents of ascribing moral responsibility to corporations and their reasoning comes across as an attempt to demonstrate that those who are against such ascription are actually in favour of it after all! For example, Hsieh states that what emerges in his discussion of the issues is “that by assuming business firms are moral agents” one can “sidestep long-standing debates about the purpose of the for-profit business firm” (page 190). Hsieh recognises the obvious problem with this, namely that it assumes moral agency, which is precisely the point at issue. However, his attempt to break out of the circle through redefining the purpose of corporations is unconvincing. Perhaps no synthesis of the opposing arguments is possible.

More seriously, taken as a whole, the essays suffer from a glaring omission: all of the authors appear expressly or impliedly to view morality as a human construct and none of the essays examines this assumption. Christians and other monotheists will take issue with this. If a personal God exists, then moral responsibility is ultimately to do with a person’s relationship with that God: to say that someone is “morally responsible” is to say that they are accountable to God in relation to their behaviour. On this basis, a corporation cannot be morally responsible. It may be legally responsible but being (at most) a human legal creation, it cannot in any meaningful sense be accountable to God.

Hence, monotheists must surely reject the metaphysical concepts of Pettit, Bratman and French and  also Hussain and Sandberg’s normative functionalism as an account of moral responsibility: if God is the source of moral responsibility then Orts’ argument that moral responsibility should be imposed on a firm “if only for pragmatic reasons” (page 218) must be rejected.

Monotheists may nonetheless agree that some of what Hussain and Sandberg say is a useful guide to the circumstances in which society might decide to impose legal responsibility on corporations. Hasnas’s insistence on a careful distinction between different kinds of responsibilities is thus crucial. However, before leaping to the conclusion that even legal responsibility should be imposed, it is essential to take account of the danger, highlighted by Hasnas, Maitland and Sepinwall, that one ends up punishing the wrong people and also to face the possibility that our desire to ascribe moral responsibility to corporations is simply a manifestation of our desire to blame someone whenever anything goes wrong.

Shareholders and, potentially, employees of corporations indirectly suffer as a result of the actions taken by regulators and law enforcement agencies on account of wrongdoing on the part of the managers of the relevant corporations. Hasnas, with pardonable exaggeration, describes this consequence as “antithetical to the fundamental tenets of liberalism” (page 94); Rönnegard and Velasquez rightly refer to the collapse of Andersen following the Enron scandal as an example of the issue, noting that tens of thousands of partners and employees suffered as a result of the indictment of Andersen on account of a few individuals; and Maitland is scathing about the modern tendency of law enforcement agencies in the USA to seek deferred prosecution agreements with corporations rather than pursuing the individuals within those corporations who have been responsible for the relevant wrongdoing (a tendency that is also manifest in the UK and elsewhere in the world), suggesting that this effectively allows those who are really to blame for a problem to use the company’s money to avoid personal responsibility. He reminds the reader of Professor John Coffee’s pithy characterisation of this as a “de facto sale of indulgencies” (page 110).

Hussain and Sandberg counter this by suggesting that imposing penalties on someone may be justified as “an incentive for them to act in a supervisory capacity”. This is true but it follows that such penalties need to be restricted to punishing the failure to exercise supervision and, clearly, should not be imposed on people who have no power to exercise it (as is the case with many shareholders and employees associated with particular corporations).

These points demonstrate the enormous breadth of the issues associated with the attribution of responsibility to corporations. The public debate about this is bedevilled by muddled thinking and ill thought through emotional responses. The Moral Responsibility of Firms is an important and high quality contribution to this debate. It deserves to be widely read.

“The Moral Responsibility of Firms” edited by Eric W. Orts and N. Craig Smith was published in 2017 by Oxford University Press (ISNB 978-0-19-885705-1). 223pp.

Richard Godden is a Lawyer and has been a Partner with Linklaters for over 25 years during which time he has advised on a wide range of transactions and issues in various parts of the world. 

Richard’s experience includes his time as Secretary at the UK Takeover Panel and a secondment to Linklaters’ Hong Kong office. He also served as Global Head of Client Sectors, responsible for Linklaters’ industry sector groups, and was a member of the Global Executive Committee.