Should businesses have a socially responsible purpose?

The CBI, as an employers organisation, is rightly concerned about the serious erosion of public confidence and trust in business. So this debate is necessary and timely. It will be particularly valuable if it provokes an honest and searching examination of the reasons for that decline in trust, and what changes may need to be made by business to address it seriously.

I have been invited by the CBI to contribute as an interested but independent challenger, and I am delighted to do so. A thriving business sector, with people finding fulfilment through productive work at the service of wider society is vitally important. Business and society need each other.

“A thriving business sector, with people finding fulfilment through productive work at the service of wider society is vitally important. Business and society need each other.”

As one CEO has put it “you cannot have a business that succeeds in a society that fails”. We all know that there are many excellent businesses who hold themselves to the highest standards and make that positive contribution today. But we also know that the core problem is real, and it is not one better PR can solve. There is a deeper issue underlying the loss of trust which must be confronted for the long term good of both business and society.

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

At the end of 2011 I was asked by a number of business leaders, who were deeply concerned about the loss of trust in business, to work with them. They thought the wisdom in the faith traditions about the good of humanity and how organisations can best serve society had something important to offer which was sorely needed.

At a conference in September 2013 to take forward the work of what has become known as the Blueprint for Better Business, one of the business leaders listed 10 “ills” which she said needed to be addressed. These were:

  1. Anything illegal
  2. Mis-selling
  3. Selling harmful products
  4. Employing people in unsafe or harmful conditions or child labour
  5. Aggressively avoiding tax, even if strictly legal
  6. Taking risks with the environment, even if strictly not illegal
  7. Shutting factories without regard to the impact on communities
  8. A pay and bonus culture divorced from performance and proportionality
  9. Cheating for corporate or individual advantage
  10. Taking advantage of weak regulation and weak consumer pressure to maximise profits at the expense of consumers.

This is a bracing list. It captures exactly the issues which weigh with very many people in society within and outside the business community.

But it is much easier to list the ills than to cure them. And it is very clear that law and regulation alone, necessary as they are, cannot be the sole answer.

At a seminar I organised in 2009, after the financial crisis, the chairman of one of the major banks said the problem has been that people have got used to asking just two questions: ‘is it profitable?’, and ‘is it legal?’ And if the answer given to both is ‘yes’, then other considerations are rendered irrelevant. You can do what you like. He went on to say that such an approach destroys the very basis of trust in the market which is the foundation of all profitable activity. It is this culture that leads to mis-selling, because there is no real care or concern for the customer as a human person at all. Everything is subordinated to the sole goal of maximising profit.

A blueprint for better business

The group of business leaders and other experts who have recently been developing the Blueprint for Better Business initiative grappled with this problem head on. Their answer was that any account of the core purpose and identity of business was missing. Why does the business exist? What needs does it exist to meet?

Any business should be able to state clearly why it is there. It should have a purpose which is compelling, attractive and operational – that is, it should enable the business leader to look at each of their products and services and ask “does selling this take me towards delivering my true purpose or away from it?”

“A sustainable business needs a purpose that enables its people to encounter and respond to the true needs of society with the resources and innovation at their disposal.”

But not just any old purpose will do. A sustainable business needs a purpose that enables its people to encounter and respond to the true needs of society with the resources and innovation at their disposal. That demands respecting the human person, creating a common good (in which the business and its investors share) and entering into a dialogue on being true to purpose.

The Blueprint initiative has developed the “5 principles of a purpose driven business” ( These embrace both the business purpose itself and the relationships that are needed to build commitment and trust — with customers and suppliers, with an extended workforce, with the communities within which it works and with future generations. And whilst the Blueprint sets aspirational goals, it also sets out clear challenges around the perennial issues I listed above that erode trust — inexplicable pay differentials, exploitation of workers, suppliers and customers, tax planning to avoid a fair contribution to society and abuse, or manipulation of regulation for self-interest. And, most importantly, the 5 principles commit businesses to seek inclusiveness of the underserved and disadvantaged.

These principles are acknowledged to be relevant and challenging to business. But they have not come from business. Their origins and provenance are from without, from long standing philosophy and faith traditions present in our society that focus on the human person and striving for a collective good.

From the smallest to the largest business, I have seen how business can benefit from a definition of business behaviours which comes from outside of business itself. Once people grasp that this is not another iteration of CSR, but a radical re-centering of the core of the business itself, then it becomes truly liberating, and enables businesses to bring the best of society’s values to the workplace and end the corrosive divided life of different values in the workplace and within society.

I believe we need a combination of courageous leaders, demonstrable change of behaviours and constructive challenge, from within and beyond business. I also believe a common frame of reference to define the role of business in society (what I call the purpose of business) would be a great help. And we need practical actions and open dialogue about business being true to that purpose. The end result should be common standards by which all people in business are judged, challenged and appreciated. I encourage all of you to join in this conversation so that business can play its fullest role within society for the benefit of both.

Cardinal Vincent Nichols was installed as the 11th Archbishop of Westminster and elected President of the Catholic Bishops’ Conference of England and Wales in 2009. He is patron of a number of Catholic charities including The Passage and the Cardinal Hume Centre.

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  1. PreventableS -

    This is a very exciting initiative. And there have been many similar codes — Caux RoundTable Principles, Global Compact, BiTC, WBCSD and many others. One consistent challenge is that companies can flout these codes/norms for some time with apparent immunity. Eventually these externalised costs catch up with the company but often only after the execs have moved on to their next role. So are companies responsible for being their brothers’ keeper in real time? If its clear that there are failures, should “good” companies challenge laggard peers? The mining sector does this but this is the exception that proves the rule. Do we want to make this behaviour more common and if so, how?