It’s strange, even unnerving, to hear a CEO speak about society, about community, about the need to do not just what is profitable, but what is right. Last week our EMBA class heard from Niall Fitzgerald, former CEO of Unilever and corporate success par excellence, on how modern capitalism was failing because of a fundamental lack of values – and perhaps even a lack of morals.
The title of his address, “You Can’t Have Successful Business in a Broken Society,” invited a certain level of skepticism among some of my more cynical classmates. I think it’s fair to say that most of us would see a certain degree of truth in the tired cliché, “nice guys finish last,” and that few would feel the modern corporate environment is a warm, fuzzy place where everyone just tries to be friendly and get along. But I would be confident that Mr. Fitzgerald’s central point reached even my most jaded colleagues – it’s not a question of whether businesses should be more ethical, but that they must be more ethical in order to survive.
In this globalised world, short term approaches to growing profits, using resources or managing workers will simply no longer work, we were told. Gouging customers will merely open opportunities to more reasonable competitors. Today’s factory workers in low-cost economies are also the consumer class of tomorrow’s growth markets. And as for reckless exploitation of the environment – if China’s population were to reach a Western standard of living at today’s rate of resource usage, we will need nine more Earths to meet this demand. Clearly, if a business (never mind humanity) is to survive in the 21st Century, a long-term approach is needed.
Having listened to Mr. Fitzgerald’s address, I don’t think any of my classmates can now doubt his central point. If anything, I think, his cornerstone argument in favour of a long-term, responsible approach to the challenges of the modern era needs to be widened beyond business, to encompass society as a whole. After all, during the boom period in Ireland until 2007, the very banks who are now pilloried for being reckless were being criticised for not giving out enough mortgages. Undoubtedly, business in the West needs to take a good long look at itself. But the same might be said of society in general.