A Truly Good Business

Published June 2016

Back in January, I wrote a column about a talk I attended by Dr. Michael Naughton entitled “The Vocation of Business Leader.” Naughton is the Alan W. Moss Endowed Chair in Catholic Social Thought at the University of St. Thomas.

The column seemed to strike a chord among readers. The number of visitors to my website to view the column was 50 percent higher than normal and I received numerous comments.

Intrigued to learn more, I read the paper also entitled Vocation of the Business Leader which Naughton was chosen to co-author for the Pontifical Council for Justice and Peace in 2012. It’s recommended reading for any manager, regardless of religious beliefs.

I was impressed with the clarity and completeness of the 27-page document (including foreword and appendix). Its pages are filled with many of the same conclusions of best-selling leadership texts, albeit often explained in a more holistic sense.

The highlight of the paper for me is the requirements for an ethical business:

  • Provide good products and services
  • Organize worthwhile productive work
  • Create sustainable wealth and distribute it justly

Truly good products and services are those that fulfill real needs while promoting social good. Products and services that support and serve struggling populations rather than take advantage of them. Healthy products and safe services that are easy on the end user and the environment.

The paper recognizes that the workplace can be a wonderful community. There is an inherent beauty and special dignity in human work … if the worker is able to contribute their distinctive gifts to the work and is respected and recognized for their accomplishments and uniqueness.

As such, businesses have a responsibility to continually develop employees, not merely so that they can increase their productivity (which is a nice byproduct), but primarily so that they can become more complete. Work changes not only the world but also the worker. We all know people who started a career “still wet behind the ears” and emerged years later as a well-rounded, mature, genuinely happy and complete person. Unfortunately, we can also point to individuals who started a job as an eager, healthy young adult and leave years later injured, broken down and bitter.

Interestingly, the paper emphasizes the importance of a participatory workplace and the value of humble, servant leaders. The presence of these characteristics makes it much more likely that employees will grow and develop their unique talents.

Finally, there’s nothing wrong with profit, so long as it doesn’t unduly come at the expense of other stakeholders. Customers can’t be held hostage by predatory pricing, vendors can’t be squeezed to the point of insolvency. What’s left over should be justly shared by employees, management and shareholders. That pretty much rules out a CEO making multiples more than their employees, or stockholders receiving dividends while workers struggle to live on their wages.

Almost weekly we read of an organization that makes the headlines for violating one (or more) of these basic principles. As I write this, the current example is Goldman Sachs’ $5 billion penalty over the sale of mortgage bonds which contributed to the Great Recession and ignited a firestorm of distrust and hatred towards an entire industry.

Inherently good products and services. Work that instills dignity. Just pricing and sharing of rewards. If that describes your workplace, consider yourself lucky.

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