Corporate Values & Practice
Workshop 5

Convenor: Amy Marks (RSA/USA)
Core Group: Jan Hofmeyr (RSA)
& Bernard Lategan (RSA)
Tracker: Juan Garces (Germany/Spain)

Problems, issues and challenges

As a point of entry, the ambiguity of the new labour laws was highlighted. While they seek to make business more ethical, they

• Add to the cost of doing business in South Africa and therefore make it less competitive
• Lower the possibilities of export
• Raise the need for protective measures from imports, and, in the end
• Make it more difficult to create new jobs.

The full range of short and long term consequences of such a legislation has to be assessed carefully.

Two fundamentals in the business-world, which also have their ambiguities, were raised:

• Money is the ‘blood’ that drives business—it is the most efficient and least costly way of exchange and making money is therefore crucial.
• Power is the energy in business—it is inherently ethically ambiguous and has to be ‘balanced’.

What kind of ethic needs to inform corporate values in respect of money and power?

Problematising the value systems in the business world

The realm in which values play a role can be mapped into the following areas:

• Inter-ethical relationships: business (people) in relation to other business (people) (sticking to deals, etc.); and
• Intra-ethical relationships: ethical issues within the company—e.g. between management and the workers where the inherent hierarchy creates already a difficulty; management, though, has both the power and and the responsibility.
• Business in relation to the wider society, including direct and indirect effects on customers—e.g. Unilever, until very recently, used aluminium in their toothpaste; the pollution caused by industries is seldom seen as part of long-term costs for the wider society. /end p. 124/

Need to define the concept of ‘values’

It was noted that values need not always be ethical or good

• It would be important to distinguish between a first step that would involve the assessment of corporate values and a second one that would consist in an evaluation of them (ongoing?).
• Corporate values include profit, efficiency, sustainability, quality, survival, competitiveness and adversarial thinking, but also justice and fairness and service (e.g. to create jobs and products).
• An important dichotomy is a focus on the approach versus a focus on the result.
• A problem that is shared by theology and economy is optimising the balance between human evil and human good in favour of the latter. It is hardly ever, if ever, straightforward.
• Who ‘owns’ and creates the value system?—e.g., do the workers share the same values as the management? Do consumers participate in creating business values?

Ethical tensions

A tentative dualism was identified in the tension between a business philosophy that is market-driven and one that is society-driven. Three ‘anecdotes’ were used to clarify some issues:

• India has a very low cost of labour. A market-driven approach would take advantage of that situation and legitimise it by pointing to the advantage for consumers caused by the reduced production costs.
• According to a recent study, white South Africans take an average of ten minutes to go to the shops, while blacks average 35 minutes. There is therefore a massive imbalance in the distribution of resources (in this case nearby shops) that make social regulations an imperative.
• Stress is an important factor in life quality. The new labour law contributes involuntarily by driving up the production costs.

The juxtaposition of power and self-interest on the one hand, with ethics and values in corporate practice on the other, was discussed.

• The whole issue has to be re-dressed from the perspective of the worker (e.g. the demutualisation of Old Mutual) as a response to the unequal power distribution and the conflict of interests of the constituencies.
• An important question concerns whether, given the power-relations between business and the wider society, the latter is only able to influence decision through coercion and general suspicion.
• There is a way in which good values and responsibility could be part of a circular ring of consequences—if management treats the workers well they will produce more and make more profit.
• Is it possible to merge the drive for profit and the desire to offer a good service for the wider society? Religion could have something to say in this issue. /end p. 125/
• A healthy and ethical society needs both ‘value institutions’ and business that are not crippled.
• The concept of corporate institutions must not be narrowed to business: Other institutions, e.g. religious ones, need to be included.
• If passion is an important element in the business world, are not the passions of the workers sacrificed for the passion of management?

What is the relationship between religion and business?

• The relationship is ambiguous. The religious, interested and non-neutral character of business philosophies—e.g. capitalism and individualism—has to be acknowledged.
• There is the possibility that religion could be part of the problem. It causes fractures within society, often entails prejudice against wealth, and presupposes conceptions like inherent evil or good as a starting point.
• The notion that the individual has an integrated set of values is very Western. While it is religiously affirmed by some traditions (e.g. Christian), Asian and other cultures provide alternative approaches.

Ways forward

It was questioned whether an all-encompassing solution of all the problems is either realistic or possible. Assuming it is neither realistic nor possible, the focus should rather be on minimal factors:

• Diversity is a ‘given’
• Grand-narratives are of little help
• All common denominators exclude some group or the other.

This has made difficult the development of a fully adequate theology of economy. A possible source in tackling the problems arising in the corporate world could be the wisdom literature collected in the Hebrew Bible: Despite its canonisation it includes an impressive diversity of cultural influences over a long period of time and experience.

An important factor to be considered is the changing role of core values in different society and cultures.

• In the distant past agriculture was central, yesterday industry with its tangible profits was important, while today the globalised world is focussing on knowledge industries and information technologies.
• The differences between those structures, as well the contexts of possible sources for solutions have to be assessed in their consequences.

Principles for generating adequate corporate values:

• A communal and local process is the necessary beginning.
• It must include tackling issues of contestation, marginalisation and privilege in the discourses that would shape possible ways in dealing with the problems. /end p. 126/
• Solutions for specific problems would only have a realistic outcome if they are short-term, flexible, as inclusive as possible, and focussed on a clearly specified problem. /end p. 127/