Why does business appease its critics?

Why does business appease its critics?

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In a recent Financial Post editorial (“Two-faced book”, 3 February 2012) Peter Foster laments “the pervasive air of apologetic hypocrisy” in which business leaders engage in order to appease those who criticize business and profit making as evil. He cites Facebook CEO Mark Zuckerberg as an example. In a letter filed with Facebook’s IPO offering, Zuckerberg claims that FB was founded to “accomplish a social mission–to make the world more open and connected” (and not to rank female Harvard students based on their attractiveness, as per the movie …). He also addresses problems in “job creation, education, and health care.” Mr. Foster points the finger at business schools that “dispense anti-capitalist propaganda” and the media that cultivates “the perception that business evil is rife.”

But Mr. Foster does not name the root cause for such bases of attacks on business and for the business leaders’ appeasement of the attackers. That root cause is altruism, the moral code that has so permeated today’s culture that most people accept altruism as the only approach to ethics. Altruism holds that we should always put others’ interests ahead of our own. By that code, business is evil by definition because it pursues self-interest of its owners–profits. No wonder business  is under attack and business leaders are trying to appease the critics by citing all the social causes in which their companies are engaged.

The problem is, as Peter Foster notes, that such appeasement does not work: it does not divert criticism but rather stokes it. –Once you grant that profit making is shameful and business should “give [profits] back to society,” there is no end of claimants for the business’ profits. The solution is not appeasement but a proud assertion of business’ moral right to pursue profits for its shareholders. The solution to economic and social problems addressed by Mark Zuckerberg is wealth creation by business in free markets.

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Jaana Woiceshyn teaches business ethics and competitive strategy at the Haskayne School of Business, University of Calgary, Canada.

She has lectured and conducted seminars on business ethics to undergraduate, MBA and Executive MBA students, and to various corporate audiences for over 20 years both in Canada and abroad. Before earning her Ph.D. from the Wharton School of Business, University of Pennsylvania, she helped turn around a small business in Finland and worked for a consulting firm in Canada.

Jaana’s research on technological change and innovation, value creation by business, executive decision-making, and business ethics has been published in various academic and professional journals and books. “How to Be Profitable and Moral” is her first solo-authored book.