Over at PoliticsHome, Lib Dem business minister Norman Lamb says business can be a powerful force for good in society, and insists responsible practice is central to his vision. Here’s an excerpt:
Business is not just about turning a profit and creating wealth. It can, and should also be a powerful force for good in our society. Through responsible behaviour, business can help regenerate communities, develop people’s skills, and produce the innovative products and services that improve our wellbeing.
Growth and responsibility underpin the work I’m taking forward through Every Business Commits, a framework which challenges businesses of all sizes and sectors to demonstrate creativity and innovation in priority areas: creating jobs and developing employee skills; protecting the environment; improving staff wellbeing; and connecting with local communities. It also calls on larger businesses to support small companies and help them grow. And in return it commits Government to creating the right conditions for business growth.
You can read Norman’s article in full here.
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6 Comments
I don’t disagree, but I find it depressing that so many people who consider themselves to be liberals think that business as an activity needs to be justified in some way by reference to the benefit to society as a whole.
When we as liberals see that people want relationships other than the one-man-one-woman-forever model, we say that is their free choice and we don’t ask for justifications related to the benefit to the rest of society. When we see that a group of people want to worship a different deity to others again we say that is their free choice and we don’t ask for societal benefit to be proven. Nor should we ask for justifications when we see that people wish to trade time, work and products with each other. “Yes, you can and you don’t need to justify your choices and free interactions with other people” should be the default answer for anyone who believes in freedom and sees man as a creature whose natural position is on his feet, not kneeling before an all powerful state.
It depends of the nature, culture and behaviour of the business doesn’t it?
I think all institutions should reflect on the “first do no harm” principle that I believe Google attempts. But here is where the LibDems go wrong: all this focus on small business! Why? Lorely Burt and Norman Lamb focus on SMEs etc. What is the evidence for their success? Lots of evidence for there failure. What we need is flourishing big companies like Tata with Jaguar Landrover or Airbus. Or Compass, which employs 50,000 people. It would take about 30,000 new SMEs to replace a Compass – and that would be the survivors of an 80 percent attrition. Then if you look at the whole system that a big company serves you can at least double the employee numbers.
I really do not understand what is wrong with our policy makers. If you really want to help small companies AND communities then go for Social Entprises. The research shows that they are ten times more productive than SMEs from start up to two years running.
It’s about time we hard a long hard look at the evidence behind some of our theories!
“Business is not just about turning a profit and creating wealth. It can, and should also be a powerful force for good ….”
One of the problems is the profit is measurable as a quantity, while the good of society is qualitative- and any quantitative measures of quality can be disputatious, such as waiting times for surgery. The primacy of “shareholder value” is taught in business schools – value measured as profit now and in future. Junior and middle managers are typically given responsibility to manage the bottom line, not the public good. In manufacturing, it can be easier for a manager to defend a choice of business strategy based on profit compared to one based on society’s good. Employees may be displeased if a business gives money for good works rather than for wages and salaries. Councils who preferentially award contracts to businesses that support the community could face critisicm of unfair competeition, even bribery or corruption!
And what is the public good? Big supermarkets have historically raised quality and reduced prices compared to small retailers. I remember things begore supermarets, and think they are good, but someone else thinks they destroy neighbourhoods. Cynics argue that good works are nothing more than a marketing ploy.
I mention these things as problems to be resolved, not as objections to the concept. I think the early history of many of our older companies demonstrates a committment to improving communities – Pilkington Glass comes to mind – and of course we have the example of Bill Gates, but he separated business from good – philanthropy only came after he had made his billions, not while (that is the impression one gets, anyway).
Best of luck to Norman on promoting responsible capitalism. It crosses departmental boundaries (look at what Simon Hughes recently unearthed about the appalling way Thames Water is run), and will mean revisiting decisions made recently – such as that on the pubcos, where his predecessor let irresponsible companies well and truly off the hook at the cost of thousands of SMEs.
What Richard Swales said.