Ethics:

Individually Subjective, Universally Objective.

Photo: 'Patan Durbar Square, Nepal'​ by Aaron Santelices on Unsplash

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Business Strategy, Culture & Communication
Written by Lateef Mauricio

Ethics: Individually Subjective, Universally Objective.

We’re at a point in the evolutionary path of commerce where it’s becoming difficult for consumers to separate business and philosophy. Buyers have so many good options for any given product that they no longer have to settle. This is creating a formidable consumer force that, fortified by unprecedented access to a near-endless supply of information, understands the significant role corporations have in influencing societal outcomes.

See, in any given society, things like norms, values, and philosophies are trusted to public and cultural institutions that manage what is right and wrong, good and evil, and so on. This shared understanding of morality is dynamic and ever-changing, unlike scientific facts, which are static. For example, the waves of our great oceans, the call of a hunting eagle, and the human ability to walk on two feet, are all observations that can be explained by science, they never change. But our civil codes, laws, philosophies, and religious rituals are manufactured by humans and defined through a shared understanding across groups of people, they always change. We build governing organizations to carry out these shared beliefs and institutionalize them. And though we’re not often cognizant about it, we have a very similar relationship with corporations, who play a role in defining, and to a lesser extent, governing, these beliefs we share across our societies.

Corporations influence society’s ethics, but they aren’t required to act in the best interest of the public.

Corporations produce things we need and want, they foster innovation, we interact with them multiple times a day, and they influence the way we think about life in general. But unlike publicly funded and publicly accountable institutions, corporations are not necessarily required to act in the best interest of the public. Though corporations are publicly funded by proxy, through the purchase of company goods, distribution of company shares, and allocation of tax benefits, they are not publicly accountable in the same way we hold government agencies responsible for their duties to society. This isn’t to say that corporations are evil, but that we should be observant about the ways we enable businesses to influence society—especially since it’s possible for a particular company’s interests to be at odds with a particular society’s interests. In my previous article, I highlighted the relevant and contemporary case of the tobacco industry, which is experiencing better revenues than ever despite being responsible for seven million deaths per year as reported by the World Health Organization.

Consumers prefer to work with companies that align with their personal ethics. Ford Motor Company gets it, and so should you.

Corporations that are looking to thrive in the future should take a clear stance on social issues and resolve ethical quandaries with speed, as if they could make or break the business. Companies can do this in different ways, but it often starts by establishing a sense of purpose that is bigger than a mundane conversation about products and services and instead aims to hold significant implications on society at large. Ford Motor Company is doing this today by positioning the corporation as one that is dedicated to improving the way people live and how they interact with transportation technology. CEO Jim Hackett says that it’s time to “reclaim the streets for living,” emanating a sense of empathy for humans whose cities have been taken over by vehicles. The specific words Hackett uses in conveying his vision for the future carry idealistic connotations and play a role in defining ethical and moral standards not just for the company’s employees, but for society at large.

Image that says "Ford's vision is to return streets to people." source: citylab.comIf we consider that Ford has over 200,000 employees, $145 billion in revenue, thousands of dealerships worldwide, and millions of cars on the road, we can be sure that this corporation’s impact on society goes far beyond simple commercial transactions and stock price shifts. The Ford example illustrates how corporations can have such a large footprint that they are able to significantly influence society’s collective set of norms, beliefs, and ethics. The word corporation itself is derived from the Latin word corporatio, which means “assumption of a body.” If everybody contributes to our shared legal codes and moral standards, then corporations, as personified entities, have greater implications on society than the numbers reported on a balance sheet.

What’s really interesting is that each of us, as individuals, carry a unique set of ethical standards and beliefs—they are totally subjective. But when we come together as groups of people to form societies, we have to agree on a shared set of ethical standards—effectively converting what was once subjective to appear objective, and almost indistinguishable from fact. As we collectively agree on these shared ethical standards, our codes and laws strive to represent the interests of society at large; but they also tend to represent the interests of parties with the strongest capability to exert influence, and sometimes this is detrimental to specific segments of society, as is the case with the tobacco industry.

There’s not a lot of room in today’s competitive economy to remain neutral on social issues, and tomorrow’s consumer will make sure businesses get the point.

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