Business Ethics 101

As a Christian I believe that morality exists. I believe that there is a metaphysical definition of right and wrong that transcends culture and personal preference, and I believe that people ought to do what is right. But morality isn't popular in all circles (even the word morality has taken on a negative connotation). In particular morality and ethics are unpopular in business and economics.

I went to a lunch seminar a couple of weeks ago where three of the top University of Chicago finance professors discussed their views on ethics in light of the Financial Crisis. Two of these professors rejected the idea that ethics had any place in business or economics. They believe that the economy is driven by incentives and self-interest. It would be ignorant to believe otherwise, and destructive to try and impose a system that misdirects self-interest. Instead, they suggested that morality in business is self-regulated because corporations and executives value their reputations. Corporations won't break the law (or at least they won't do it in a gross and noticeable way) because such action would compromise their reputations and cause their customers to shop elsewhere. Executives won't make decisions that hurt their employees or that harm consumers because they value the reputation of their companies (meaning, they value their salaries), and they value their own reputations as businessmen and women.

If you don't work in the business world, you can probably identify the gaping holes in this argument without trouble. There are numerous real world examples where businesses have compromised their reputations to increase profits, and the argument does not account for goods and services that are not sold to the general public. Certainly, if a newspaper reported that Mattel was using sweatshop labor, or even slave labor, to produce its toys, then consumers would respond and punish Mattel by not buying its products.

(Mattel doesn't pay great wages, but the company does better than most regarding overseas work conditions--mostly due to consumer backlash against sweat shops. See this NYTimes story.)

But what about a company that does not sell to Jane and John Smith, where public backlash does not affect profits?

Impact on reputation is not an appropriate or effective measure of whether a business action is wrong or right, and I think deep down my professors know that. The other presenter, Luigi Zingales, took the most balanced perspective on business ethics. He confessed his uneasiness with the idea of self-regulated self-interest, citing the fact that businesses are composed of people, and these people are influenced by their surroundings. Without an ethical norm, employees could easily slide down the slippery slope to illegal behavior, if not immoral behavior. Dr. Zingales was troubled, but he had not yet found a satisfactory answer to the problem of ethics in business.

I sympathize with Dr. Zingales. Ethics and morals are metaphysical, and American business is anything but metaphysical. How do managers enforce an ethical code without reference to some greater ethical norm prescribed by a religion or philosophy? I'm not sure.

What do you think? Is morality necessary in the business world? If so, how should we to measure morality?

Creativity

I heard this guy named Shane Claiborne speak at the Urbana Missions Conference last week. (he's been getting pretty popular with the Christian social justice crowd lately). I was impressed: he spoke truth with conviction about money and justice and being a Christian. Praise God for his work.

He made one suggestion that resonated with me, especially in the context of business school. Banks and corporations spend a lot of money analyzing consumers and figuring out how to sell their products in the marketplace. At school I have grown to appreciate the depth of creativity in firms' marketing and strategy departments. These companies hire brilliant people who are trained to target consumers and pay them a lot of money. Shane suggests that Christians should aim to match corporations' commitment of creativity with our own creative efforts to preach the Gospel to the poor and proclaim release to the captives.

Just an aside: I've never felt very comfortable with marketing--it smells like manipulation, and I'm a big believer in individual freedom and choice. At the same time I see it's necessity. If a company develops a killer new product, I want to know about it. Maybe I can use this new product to improve my life. Or alternatively, maybe I can use this new device to better preach the Gospel to the poor.

But I really like Shane's point. Wouldn't it be amazing if Christians directed the same kind of fervent creativity toward ending sex trafficking that credit card companies direct toward getting consumers to go into debt? What could we accomplish? What mountains would be moved?

I have a few more thoughts on this topic, but I'll save them for later. In the meantime please watch Shane's talk below--it's compelling.

On Christ the solid rock I stand, all other ground is sinking sand.

Just a reminder...

If you are a poor creature--poisoned by a wretched upbringing in some house full of vulgar jealousies and senseless quarrels--saddled, by no choice of your own, with some loathsome sexual perversion--nagged day in and day out by an inferiority complex that makes you snap your best friends--do not despair. He knows all about it. You are one of the poor whom He blessed. He knows what a wretched machine you are trying to drive. Keep on. Do what you can. One day (perhaps in another world, but perhaps far sooner than that) He will fling it on the scrap-heap and give you a new one. And then you may astonish us all--not least yourself: for you have learned your driving in a hard school. (Some of the last will be first and some of the first will be last).

-CS Lewis

What am I going to do when I turn 22?

The Wall Street Journal did a great interview with Alain de Botton (link on the title). He's sort of a philosopher of everyday life.

For me the most interesting part of the interview:

When college graduates are trying to figure out what careers to pursue, what should they ask themselves?

The process demands such a vast amount of thought that it's hard to summarize other than by saying: take this moment in your life very, very seriously. I studied the world of career counseling and was amazed by just how casually people continue to fall into jobs. Most of us are still in jobs chosen for us by our unthinking 22-year-old selves. We speak endlessly about waste: waste of energy, of resources, of water. But the most shameful waste is of people's talents.

Alain is smart; I agree with most of what he says in the interview. But I take issue with this response. I don't agree that the moment of decision at 22 is vitally important. And I think Alain is making a mistake to emphasize it for three reasons.

1. If a 22 year old is reading the transcript of his interview and is more than a little unsure about the direction of his life, then de Botton's words will likely cause mor harm than good. 22 is a tender age--having plenty of reasons to be insecure. de Botton isn't helping to ease the decision process.

2. If a 22 year old doesn't have a good idea of what to do next, then he probably won't make the ideal choice when forced to decide. de Botton is right--what we do for work is important. We spend forty or more hours a week working--it should be somewhat interesting and fulfilling. But I do not believe that a 22 year old will discover what interests or fulfills him by sitting down with a pen and paper and trying to make a career decision. Rather, he should examine his life for trends and interests that point toward his calling. What does he like doing now? Can he somehow make a living doing that thing and doing it well?

(Side Note) Some folks know what they are going to do for a career at age 10; some at age 20; others don't figure it out until later. I think that self reflection and career planning are useful regardless of when a person makes the career decision. And I think it's an ongoing process. I made a bad career decision at age 22, but now I'm 26 (so much wiser and more mature :P) and I have the experience and capacity to make better decisions.

3. Career decisions are important; however, peace and fulfillment do not come from obtaining the perfect job. And in truth, a job that is valued too highly will ultimately let us down. The economy is in constant flux and each of us will have to grow and adapt with the changing world in order to continue to provide value. If we stake too much hope on a single career done in an established way, then we will be left behind economically.

But my primary concern is spiritual--not economic.

The author of Ecclesiastes writes, "What does a man get for all the toil and anxious striving with which he labors under the sun? All his days his work is pain and grief; even at night his mind does not rest. This too is meaningless. A man can do nothing better than to eat and drink and find satisfaction in his work. This too, I see, is from the hand of God, for without him, who can eat or find enjoyment?"

Of course, the author was writing before organized labor and the subsequent establishment of the weekend and a retirement age. But you get the point: work and calling produce anxiety. However, they do not have to. There is One who offers peace that surpasses all understanding.

Christ Against Culture?

Forgive me while I psychoanalyze...

I'm reading Christ and Culture by H. Richard Niebuhr--I'm about half way through and it is excellent. Niebuhr pieces together historic Christian approaches to how Christians ought to live in the World (which he calls culture and spends a chapter defining. Niebuhr in short: the World is the value systems, philosophies, art forms, politics, and economics that make up a culture).

The problem, it seems, is that Jesus promises eternal salvation, but we're not dead yet. How ought Christians live (and how should I live) in the interim?

Niebuhr examines five answers that Christians have posited to this question, and each answer is fascinating. Each approach has taught me more about my self and my faith.

Of particular interest has been the approach that Niebuhr calls 'Christ against Culture' or the 'radical' approach. These Christians--represented by groups like the Benedictines (back in the day) and the Mennonites, and people like Leo Tolstoy--were convinced that the Christian must separate from culture in a radical way, either through vows of poverty, disavowal of political action, or, in Tolstoy's case, disengagement with culture altogether. These men and women are to be commended.

"In history these Christian withdrawals from and rejections of the institutions of society have been of very great importance to both church and culture. They have maintained the distinction between Christ and Caesar, between revelation and reason, between God's will and man's."

Amen.

I have been drawn to this approach in the past and am drawn to it now. I dream of living a radical life and were it not for video games and girls I might pursue it more seriously. It seems to me that Christ is worth being radical for. Some people are radical Marxists or radical libertarians--that's fine--but those ideologies have very defined material ends, while Christ promises change and transformation that transcends politics, culture, and economics; affecting and saving the soul. He promises a new society, a new ethics, a new life, and a second chance for anyone who has failed. What a Man to follow radically!

But at times the 'radical' approach is not the right approach:

"Now that we have recognized the importance of the role played by anticultural Christians in the reform of culture, we must immediately point out that they never achieved these results alone or directly but only through the mediation of believers who gave a different answer to the fundamental question. Not Tertullian (a radical), but Origen, Clement of Alexandria, Ambrose, and Augustine initiated the reformation of Roman culture. Not Benedict, but Francis, Dominic, and Bernard of Clairvaux accomplished the reform of medieval society often credited to Benedict...in every case the followers did not so much compromise the teachings of the radicals as follow another inspiration than the one deriving from an exclusive loyalty to an exclusive Christ (against culture)."

Augustine, Francis, and the other followers took ideas and values from the radical approach and used them to engaged culture. They saw tremendous change. Whole countries, whole empires became more just and more God-fearing because of their work.

Now, I'm trying to figure out how I want to live my life, and I keep getting pulled back to this desire to be a radical Christian. For some reason, I can't pull it off. I try to be a radical, but lose my desire after about 45 minutes. It seems like I just wasn't made to be a radical. In light of this struggle, I appreciate Niebuhr. Perhaps I can live for Christ as a radical-inspired non-radical. Perhaps I can take the ideas of Benedict and St. Antony and apply them in the context of my normal life. And as Niebuhr suggests, perhaps living this way I can have more of an impact than if I were a radical.

What do you think?

a kinder, but still shrewd, manager

(A couple of weeks ago I posted about the parable of the shrewd manager in Luke 16. I meant for this post to be the start of a three part shrewd manager series. Here's part 2.)

Davidthird comes from my position in my family. My dad's name is David, my grandfather's name is David, so I am David the third. Davidthird.

This post is about David the first, David Edgar Dilworth, or Grandpa D. He was a great servant of the church, first as a missionary, then as a theology professor, and finally as a pastor. Grandpa D passed away four years ago this week, and as a memorial I wanted to share a story of the shrewd manager in his life.

My Grandpa suffered from neuropathy, a disease that affected the nerves in his extremities. The disease became so bad that he could hardly move his hands or feet toward the end of his life; regardless, he taught classes at a church in La Canada every week until he was 82. He would roll into the classroom with his walker a few minutes before class. A few times he asked me to write some notes for him on the white board, but frequently he taught without notes--for his class and for himself. His final series of classes, the ones I remember best, were on the parables of Jesus, and he knew them so well that he did not need notes.

It worked out that he taught on the parable of the shrewd manager just a few weeks after I had studied the passage in my dorm. I was surprised at the timing--I had not heard of the parable in eighteen years of life, and suddenly it had popped up twice in one month. He began his exegesis slowly, constructing the world in which the shrewd manager lived and then walking his students through the sticky text of the parable. He took his time, savoring the text and the students. Grandpa D loved the Bible, and he used quiet charm and disarming smile to teach others to love it too.

But his charm did not cause him to mince words--I think especially in his old age. He knew that Jesus was serious when he said, "No servant can serve two masters...You cannot serve both God and money." So in his calm, compelling way, he called the class to conviction, and the room grew silent--La Canada is a wealthy place.

Grandpa D could have shied away from this last verse, shielding himself from the class's forthcoming hard questions and criticism, but he did not. My Grandpa did not draw his worth and his purpose from the class's approval, though he frequently had it; neither did he draw his worth from money, though he was not poor. He lived for a higher honor, which he has now received.

Well done, good and faithful servant.

This week's Economist cartoon

I'm not usually struck by political cartoons, but this week Kevin Kallaugher did a really thoughtful sketch for The Economist. Obama is extending his hand to Mahmoud Ahmadinejad and a bunch of Ayatollahs--and in response the Iranian leaders shrink back in fear.

Our president has proposed greater diplomacy to counter the terrorist threat--particularly in regard to Iran. Diplomacy sounds nice because it does not directly involve guns or tanks, but maybe it's more than nice. Maybe diplomacy has a power that violence does not, maybe diplomacy will restore peace to our world by disarming our enemies and softening their hearts.

Jesus said, "Blessed are the peacemakers for they will be called sons of God." But I remember that King David also lamented, "I am a man of peace; but when I speak, they are for war."

I follow Jesus, so I want to be a peacemaker. But it seems that being a peacemaker doesn't necessarily mean that there will be peace.

See the full cartoon here.