The Call to a Sustainable Future and the Revolutionary Paradigm Shift in Global Business

It has been some time since I last wrote to you, my dear friend. These past many weeks I poured myself into study in preparation for the South Carolina bar examination. It is a monumental task to prepare for, the test itself even worse. I have no idea if I passed or failed. I do know that I poured my being into it in preparation and that I could not have spent any more effort that what I gave. I am glad to be done with it, hopefully forever.

Much has transpired since I last had time to reflect through writing. The event that stands out most in my mind is the oil catastrophe in the Gulf. It deeply saddens me the thought of what we lost as a result of extreme recklessness by BP and other affiliated parties. If any possible good can come from this, it must be this: the collective realization that we cannot continue to conduct business in the same way that we have in decades past. We must finally find it within our public conscience that the only hope we have in a future Earth to be inherited and enjoyed by our children, and our children’s children, and the only hope in having an economy that can meet the needs of the present generation as well as the needs of future generations, is in this one key word: “sustainability.” You will hear me say this many times: there is no future in business if there is no future in Earth; to have a sustainable Earth, we must have sustainable business. Thus the ends become means, and the means the end: to sustainability by sustainability.

After I have had a chance to complete my discussion on the history of the business corporation up to the present era, I will reorient the discussion to the emergence of this important strategic paradigm shift called sustainable development. I will show that there is no clear intellectual parent that gave the concept birth, but that a unifying force across many spectrums converged to shape this concept and prepare it for implementation by the 21st Century global corporation. I will go into all of these things in much greater detail later, but for now I will briefly explain what I think sustainability means, or what it ought to mean, as there are numerous interpretations of the concept depending on the context and who you are talking too. In the business context, and as it applies to the global economy, sustainability is simply this: to achieve measured, responsible profitable growth over the very long term. On the surface this sounds too simplistic, and at first glance seems not much different than what a Milton Friedman disciple would argue – that profitability is the end all and be all of business. But that is precisely where I disagree with Friedman’s conclusions. My understanding of what profitability means and what it takes to achieve long-term profitability is much broader in practical scope than Friedman’s, and further, deeper in ethical root. Profitability is not the end all and be all of business; purpose is the end all and be all of business, as it ought to be for all human endeavors and publicly created entities. Profitability, and by extension business, must ultimately serve the ends of purpose. I will refer to this concept as purpose-driven profits. Deeply imbedded within this concept of purpose-driven profitability is the full recognition that to achieve profitability from one quarter to the next, from year to the next, from one decade to the next, there must be a continual consideration and reevaluation of all facets that go into implementing a successful, sustainable, long-term business model across multiple spectrums and economies, including responsible resource consumption, efficient energy usage, safe and lawful waste disposal, fair labor practices, effective research and development, community reinvestment to encourage growth among emerging consumers, conflict resolution to insure stable markets, adequate and affordable healthcare and medical care and housing and infrastructure, and on and on. These variables confront every major multi-national corporation today. In the near future, I will supply ample primary sources to back up this conclusion.

But why focus on profitability at all, one might inquire? Because bottom-line profitability, while it is not the end all and be all of business, it is VERY VERY VERY important, it is critically important. I cannot emphasize that point enough. One of the many lessons the latest financial crisis should teach us is the great cost on the public purse when big businesses become unprofitable and unsustainable. The public simply cannot afford to keep picking up the tab because corporations have deployed a faulty and short-lived business model. It is incumbent upon those charged with leading these great multi-national corporations to apply the greatest care and skill and caution to insure that their respective operations are not only profitability next quarter and next year, but 10, 20, and 50 years from now. Further, it is incumbent upon our elected officials to establish a sufficient and effective regulatory framework to correct corporate misbehavior when businesses have not lived up to their end of the public bargain.

These very discussions are starting to emerge in business courses around the country. The country’s leading business school, in fact, UPenn’s Wharton School was the very first to create a PhD program dedicated to business ethics. The University of Virginia, the University of Michigan, Harvard and others are similarly updating their curriculum to confront this paradigm shift taking place in boardrooms across the globe: how do we implement a long-term business model that simultaneously seeks profits as well as purpose, that aims to make money as well as make a difference, that is environmentally friendly, socially responsible, and morally justifiable? The key is sustainability.

Peace

Jeremy MacNealy