POLITICS AND NATURE

“The job of business is to make money, and the job of government is to regulate business.”

This is a major portion of an essay question for a class I took titled “Globalization and Corporate Responsibility.”

This statement is correct to an extent. An individual considering opening a business, spending the hours necessary to get it up and running, and possibly investing a life savings should be able to see a return on his or her investment through making money. The same is true with investors. The incentive to invest a portion of one’s earnings is to see a return which would be greater than placing money in a bank. The profit motive has many positive attributes but it does not need to be the sole meaning driving business.

Business should exist for beneficial reasons while striving to maintain a profitable structure within the context of civil participation. We have seen examples of terrible mismanagement and fraud at the top of the social pyramid. These will likely always occur in one form or another and government should act to reduce social harm.

Government’s job is to create the playing field in which socially responsible businesses are not placed at a distinct disadvantage from those who would abuse the system. Its job is also to protect people....in the words of the U.S. Constitution: “to promote the general welfare.” Government is not just about business. This is why the current CEO President has been such a dismal failure, in my opinion.

He and his subordinates believed government should be run as a business. Of course, how a failed businessman thought he could run the most complex set of institutions on the planet after being unable to run a baseball team will forever be unknown to me.

Kotler and Lee (p. 3) define CSR as “a commitment to improve community well-being through discretionary business practices and contributions of corporate resources.” Paine (p. 52) cites a study which “concluded that an enduring value system was a key driver of long-term financial performance.”

One Economist article quotes John Ruggie of Harvard who said: “The theological question-should there be CSR?—is so irrelevant today . . . Companies are doing it. It’s one of the social pressures they’ve absorbed.” Since companies are already invested heavily in CSR, it appears that the paradigm of profit only business structures is changing.

Business without profit will be unable to compete or even keep its doors open so making money will continue to be the top priority. I personally think this is a good thing. But it is something which, in today’s market, with all the information available about business practices and the threats of litigation, must be tempered with an acknowledgement of civic responsibility.

Profit and social/environmental health do not have to be in conflict. This is merely how we have conducted business for so long, we are having a difficult time adjusting to changing circumstances. Government has the job of oversight but, as is so often remarked in relation to current bailouts, it should not pick winners and losers. And yet it does so all the time. My favorite section in any of the articles in this class comes from Cromwell’s Fossil Fuel Dinosaurs :

Unsurprisingly, the oil industry is reluctant to admit that the economies of the energy markets are heavily loaded in their favor. At an industry conference in 1997, Shell’s Heinz Rothermund stated categorically, ‘It is a hard fact of life that renewable energy sources are not economically viable’. Oil executives are always reluctant to acknowledge the huge public subsidies made to their industry when they trumpet the free market; instead they ruefully shake their heads at the ‘unfavorable economics’ of renewable energy (Cromwell, p. 117).

The government acts in the corporate interest all the time. It is also the largest employer in the nation and the balancing act it must accomplish between responsiveness and legitimacy with the need to support jobs and economic growth results in regulation being but one aspect of governmental responsibility.

In relation to corporate power and CSR, the government also has authority over fiscal and monetary policy, trade agreements, and the U.S. government exhibits a great deal of control over the IMF, the World Bank, the WTO, the OECD, NATO, and many other global compacts. The elimination of efforts aimed to weaponize space alone would send a number of large corporations scrambling for new benefactors.

It is easy to fault all of this interaction between government and industry and lay blame at the feet of those with the money and the power who ignore all the calls for justice arising out of the NGO community. NGOs do wonderful things in a great many instances. However, many NGOs are perceived by the greater public as filled with individuals who are pompous, rude, self-righteous, and self indulgent.

The environmental movement, in my opinion, has done a great deal of harm to the objective of overcoming the divide between people and nature by ignoring real people’s needs which are often tied to corporate success, or at least to business. There is a real struggle over communication across ideological boundaries in the global era. Government should act as a bridge between different sectors of society in order to encourage dialogue and information sharing. This will not always work but it will provide one step in the right direction.