The Interests of Others
An article by David Murray, originally published in Faith in Business Quarterly, Volume 1, No. 3, September 1997. It was based on a presentation at a Ridley Hall (Cambridge, England) “Stakeholder Symposium” earlier in the year.
It is now almost seven years since Charles Handy presented to the RSA his paper, What is a Company For?, which has had a major impact on the thinking of many - managers, consultants, academics and politicians - in this country. It has gone down in many minds as an appeal for stakeholder involvement in corporate governance. In fact, Handy was hesitant about this idea, at least as to how it might be achieved in practice. He did, however, express powerfully his concern that a company should be viewed as a community of interests to a far greater degree than is currently the norm.
There are many different definitions of the word “stakeholder”. The one I favour is:
“An individual or group of people (present or future) who are either actually or potentially affected by the existence, the business performance or behaviour of the organisation”
With this in mind, I shall now focus on some Judaeo-Christian, biblical principles of behaviour, which I believe apply universally within economic life just as much as in other interpersonal relationships. These principles require an others-centred approach to economic life compatible with the concept of “stakeholder”.
In my book Ethics in Organisations, I have made some practical suggestions as to how an organisation might identify its stakeholders and then consider the ethical issues involved in relationships with them. This is far more than a simple matter of listing conventionally the employees, shareholders, customers, suppliers and local communities. It means considering in depth what range of important relationships need to be managed morally, how the issues vary between different specialist functions within the business (finance, personnel, marketing, etc.) and between different levels (from the coalface of service-provision to the strategic process of the boardroom). In asking “What are our responsibilities with respect to these stakeholders?” one is asking a very similar question to that answered by Jesus when he was asked “Who is my neighbour?”, and replied with the parable of the Good Samaritan.
Managerial Complexity
I am aware that one of the objections to all this is that managers cannot be expected to juggle so many balls simultaneously; they will inevitably take their eyes off the one ball that really matters. Even assuming that there is one such boss-ball, I have a serious difficulty with this argument.
Until 1991 I was a partner in the Hay Group which, among other professional interests, is globally a leading adviser on executive compensation. In more discussions than I could possibly count, directors would stress the thinking and decision-making challenges of their jobs. One of the features of such top slots, they would insist, is complexity. Others, further down the organisation, may be able to think within relatively prescribed boundaries, but directors must inevitably manage a balancing act between conflicting priorities, ambiguities and the uncertainties of long time-scales. Our model of management job weighting quite rightly took account of that.
There can, however, be no logic in arguing the complexity case when setting levels of financial reward, but claiming the impossibility of handling complexity when faced with the challenge of multiple stakeholders.
I feel certain that the priest and the Levite shown up by Jesus as uncaring and inconsiderate in the parable had many different relationships to manage in their respective positions of seniority; no doubt they passed by the injured man at the roadside with their minds weighted down by their responsibilities. But this did not reduce their responsibility to recognise and respond to the situation of yet another “neighbour”.
The Relevance of the Bible
For one and a half millennia the civilisation of Europe has rested on moral values derived from its Judaeo-Christian heritage. Of course, Western society has frequently (one might almost say consistently) failed to live up to its high ideals. Self-centredness and greed have all too often come to the fore at every level of society, leading in the extreme to cruel warfare. The ideals have, nevertheless, been there and have shaped behaviour and moderated misbehaviour over many centuries. We cannot afford to abandon the foundations of trust, hope and mutual consideration on which our civilisation has been built, however shaky they may have been at times, and may be at present. Hence I have no hesitation in turning to the Bible.
There are some topics relevant to particular stakeholder relationships on which specific biblical laws and instructions are to be found, e.g. fair and prompt payment of employees, or the use of accurate weights and measures in serving customers. Care for the environment is also an implication of the Genesis story which commits stewardship of God’s creation into the hands of human stewards. But there is also material which is more broadly relevant.
Throughout the New Testament various writers give us concise descriptions of how a Christian life should be lived. Much of what they have to say is about relationships with others. Passages to consider include 2 Peter 1:5-7, James 3:17-18 (the “wisdom that comes from above” ), Galatians 5:22-23 (the “fruit of the Spirit”) and Matthew 5:3-10 (the Beatitudes). In many respects the New Testament builds upon the legacy of the Old. The book of Proverbs emphasises a whole series of important relational qualities: truthfulness (14:25); hard work (14:23); loyalty (17:17); humility (16:18; 22:4); prudence (22:3); patience (25:15).
In 1994 I worked extensively in the post-Communist economies of Central and Eastern Europe, seeking to help people there articulate some core vales on which economic life within a market system could be based whilst simultaneously retaining a true allegiance to the Christian values of love and compassion which had inspired many of the opponents of Communism. One outcome of that work was a statement of seven core principles of business integrity.
These were based on extensive discussion of biblical passages such as those already quoted, on study of the moral dilemmas facing people in the very difficult environment of economic transition, and on debate aimed at expressing biblical concepts in terms which could be taken on board as almost self-evidently desirable by people in general - whether or not they accepted the authority of the Scriptures from which they were derived.
Focus on Others
Within all of the above there is a unifying theme - focus on others. Jesus himself turned the accepted order of things on its head when he said “The one who is greatest among you shall be the servant of all” and “I, your Lord and Master, have come among you as one who serves”. His focus was not on himself. He had great difficulty in persuading his disciples that, far from setting up an earthly kingdom, the Son of Man had come to give his life. The early Christian hymn quoted by Paul in his letter to the Philippians reads “He made himself nothing, taking the very nature of a servant…he humbled himself.” Taking this example from his Lord, Paul argues that “each of you should look not only to your own interest, but also to the interests of others”. What better text could there be to put at the head of a paper on responsibilities to stakeholders?
One aspect of this “others-orientation” is the principle of interdependence. This is taught primarily in connection with the church (in both its universal and local senses), but its application seems just as legitimate in society as a whole. We are a body made up of parts which rely on one another for the functioning of the whole (c.f. 1 Cor.12). Going back to the Old Testament, we find a fascinating passage in Leviticus about negotiating a land sale, in which the command is given twice: “Do not take advantage of one another”. The “Win-Win” negotiating philosophy, considering the interests of the other party to the deal, is far from being a twentieth-century invention (Leviticus 25:14-17).
A Utopian Vision?
It may still be asked how relevant all this biblical material is to life in the modern global economy. Can followers of Christ really be expected to apply the moral virtues and practical lifestyles indicated in the passages cited above? I believe that we should heed the challenge - ultimately because it comes from God himself, but also for two very down-to-earth human reasons.
We hear a great deal today about ecological sustainability, and rightly so. We need to be seriously concerned about whether our planet can support a continuation of the way we now live and work. There is also the issue of moral sustainability. The richest nations on earth in financial terms are among the poorest in terms of social cohesion and inner personal satisfaction. Francis Fukuyama, in his book Trust: The Social Virtues and the Creation of Prosperity (1995) argues the case for rebuilding trust in Western societies. Some economists have in recent years been stressing the significance of “transaction costs” which are not immediately financial, but carry eventual financial penalties for the disintegration of what remains of a culture of trust. An economic system which is “Me-based” must convert to one which is “We-based”.
Can we do it, when everything has to happen so quickly? Is this not an idealistic pipe-dream, a religiously inspired Utopian vision, when in reality the dilemmas will be unresolvable? Is it not impossible, when often we won’t even know who all the stakeholders are except with the benefit of 2020 hindsight?
I can only answer these questions with another series of questions. Who said it would be simple? Whoever said that God’s moral demands on humanity would be easy to meet? Who ever claimed that fallible mortals would be able to achieve total compliance with such ideals? The Bible is very realistic about the impossibility of our doing so. But also, whoever suggested that the striving was not worthwhile? And we are not left alone to struggle in futility. Christ’s life, his death, his resurrection and his sending of his powerful life-transforming Holy Spirit bring a message of others-centred hope.