Monday, June 27, 2011

In response to the NY Times column “...To Be Good Citizens...Companies Should Just Focus on Bottom Line”

On June 14, 2011 Stephanie Strom of the New York Times informed us that according to a report put out by a high-priced advisory firm "To Be Good Citizens...Companies Should Just Focus on Bottom Line."

Really? It’s not surprising an advisory firm paid by the biggest corporations might come to the conclusion that “companies would achieve more social good by simply focusing on the bottom line,” but why give it any extra play?

Suggesting that greed results in good corporate citizenship is wishful thinking at best. How ironic that these same hard core MBA types who tell you “what you measure is what you get,” are trying to convince us that the best way to get good behavior is to look the other way. Spare me.
To Daniel Altman and Jonathan Berman, the consultants who wrote the report and used ExxonMobil and Cargill – poster children for the abuse of power - as examples of good corporate citizens - WOW – that’s bold!

Let’s look at Cargill for a minute. Owned by Monsanto this company has been rapacious in its search for profits, destroying the environment and farmer livelihoods around the globe. I’m sure they’re doing some good somewhere, but the net impact? Watch Food Inc. and discover what happens when the food industry focuses on the bottom line.

They talk about how nice Cargill is being giving farmers in Africa seeds. It may sound nice but in reality it is a clever, cruel trick which binds the farmers forevermore to the seed, fertilizer, and insecticide sold by Cargill and Monsanto. It’s no different than street corner pushers passing out freebies to the neighborhood kids.

Sighting ExxonMobil's safety measures? Really? Anybody recall the Exxon Valdez? It happened in the 80’s and we’re still cleaning up. Or more recently perhaps you heard that ExxonMobil lost a bid in federal court to dismiss a lawsuit filed by the Sierra Club because of thousands of violations of the Clean Air Act. Or that New York City recently received $105 million dollar settlement from ExxonMobil for its contamination of groundwater, ignoring warnings from its own scientists and engineers. Not because it couldn’t afford to clean it up, (they earned $10.65 billion in PROFIT this past QUARTER) but because they were focusing on the bottom line.

Unless required by law to be good corporate citizens companies cannot afford to be socially responsible. If the goal is profitability, the profit imperative will sweep everything else to the side. Corporations used to be more community-minded, when owners and management lived and worked in the communities that housed them. Today, with multinational corporations beholden to no person, state, or nation we’re seeing even the vestige of corporate citizenship dying. All that’s left is the façade. And reports like this denying what we, as individuals can see around us every day everywhere.

There are many companies out there run by persons of conscious and good will, who work for a profit, but who give back, and behave responsibly. But as a company grows, and particularly when it goes public the profit imperative becomes paramount.

This business model which focuses on profitability to the exclusion of everything else has damaged our economic, environmental, and social landscape beyond recognition – I hope not beyond repair. What we need is a new game, with different goals, to which we can apply our intellect, creativity, our passion to win. There needs to be a new scoring system that isn’t all about profits. This new game called social enterprise, and measures success by net social impact. ExxonMobil and Cargill may have achieved some positive public benefits through their operations, but if you look at the net impact I think we as a society are on the losing end of the equation.

New business structures are being birthed to accomplish this goal, where profits become a means to an end, but not the final goal. It may seem impossible to change our current paradigm, but change does happen. At one point in our not too distant past slavery was seen as a valid business model. When we as a society decided that it was immoral to build wealth this way things changed. Today we look back upon that time with shameful wonder – what were we thinking?!

I believe we will one day look back on our current model with the same amazement wondering how anyone could have thought that by focusing on the bottom line alone anything good would result.


  1. As motivators (beyond profit) become increasingly important to individuals and communities, we'll see the models transforming in front of our eyes. Have we hit the tipping point? Perhaps not yet, but we're getting there. This weekend one busy entrepreneur told me she was switching fields to one that supported sustainability - she wasn't concerned any longer about the profit motive but felt that a life lived and even lost in the effort to leave behind a healthier world had reached to level of a calling she could no longer ignore. I'm not dismissing profit as a valuable and valid motive, only that "socially responsible" driving behaviors are almost spontaneously appearing. It's time.

  2. Jenifer - Well said, and I believe you are right. Social Enterprise is an idea whose time has come!