Monday, July 2, 2012

"A Profoundly New Way of Understanding Business Enterprise"

I'm covering a lot of ground in this post. This list of headings helped me sort out the ideas. Your experience may vary:
I had a lot to learn when I became a Catholic, and still do.

The Church has been teaching why it's important to love God, love my neighbor, and that everybody's my neighbor, to anyone who'd listen for two millennia. The basic principles are simple: applying them, not so much.

I discovered that I had to unlearn a few things, including my attitude toward "social justice." Like many other 'crazy kids' in the '60s and '70s, I thought that American culture needed reform. We won: and I was appalled at the direction those 'reforms' went.

I still think American culture needs reform: which isn't the same as wanting a return to 'the good old days.' And that's another topic.

Social Justice: Catholic Style

When I ran into the phrase "social justice" in Catholic documents, I cringed: expecting calls for more of the social engineering efforts we've endured in recent decades.

But I read them anyway.

Now I know that "social justice" has been part of the Church's mission: ever since my Lord said things like "...love your enemies, and pray for those who persecute you...;" and told a story about servants and using wealth. (Matthew 5:43-44; Matthew 25:14-30, Luke 19:11-27)

The Catholic Church's social justice doesn't reflect 19th century Laissez-faire economics, 21st century American conservative values, or the preferred reality of today's establishment. (Catechism of the Catholic Church, 1928-1942; 2239; 2442)

The Catholic Church is literally καθολικός, universal. For two thousand years, the message for all humanity has been 'love God, love your neighbor,' and 'everybody's our neighbor.' (Matthew 22:36-40, Mark 12:29-31, Luke 10:25-27; Matthew 5:43-44, Luke 10:29-37; Catechism of the Catholic Church, 1822, 1825)

'Out of Step?' I'm Okay With That

I'm not surprised that what the Church says seems 'out of step' with extremes of both liberal and conservative ideas.

And I certainly don't think that the Church's position on social justice is "moderate."

But, as I learned in the '60s: being out of step with the status quo doesn't mean something is wrong.

Change, Risk, and Business

"Today's international economic scene, marked by grave deviations and failures, requires a profoundly new way of understanding business enterprise. Old models are disappearing, but promising new ones are taking shape on the horizon. Without doubt, one of the greatest risks for businesses is that they are almost exclusively answerable to their investors, thereby limiting their social value...."
("Caritas in Veritate," 40)
"Social value?" business?!! That reminds me of the well-intentioned cooperatives my wife and I shopped at, a few decades back. Some of them maintained good quality control: some didn't, which is very bad news for anyone selling food. Or buying it.

But, like I said, the Catholic approach to social justice is 'out of step' with contemporary culture. We're counter-cultural: very counter-cultural. And always have been.

Benedict XVII isn't 'anti-business.' He does, however, point out factors which make ethical lapses easy.
  • Company directors
    • Often stay in charge for a short time
    • Are expected to focus exclusively on short-term profit
  • Awareness of social responsibility is hindered by
    • Outsourcing of labor
    • Acquiring supplies from many territories
    • Selling to geographically broad markets
I see no indication that Benedict XVI thinks that a global economy is bad; just that it's hard to get feedback about social impact, when companies:
  • Get a new boss every few years
  • Deal with sources all over the word for
    • Employees
    • Supplies
  • Provide goods or services all over the world

Learning the Value of Social Responsibility

"...Today's international capital market offers great freedom of action. Yet there is also increasing awareness of the need for greater social responsibility on the part of business...."
("Caritas in Veritate," 40)
In the long run, ethical behavior is profitable. Unethical behavior - isn't. I think more business leaders will start realizing that they need to 'think big' in terms of time, as well as global markets. They may not call the principle "natural law," but that's what they'll rediscover. Or collapse:

Ethics Matter

"...Even if the ethical considerations that currently inform debate on the social responsibility of the corporate world are not all acceptable from the perspective of the Church's social doctrine, there is nevertheless a growing conviction that business management cannot concern itself only with the interests of the proprietors, but must also assume responsibility for all the other stakeholders who contribute to the life of the business: the workers, the clients, the suppliers of various elements of production, the community of reference...."
("Caritas in Veritate," 40)
For now, I'll settle for "ethical considerations that ... are not all acceptable from the perspective of the Church's social doctrine...." It's a start: and a huge improvement over previous behavior that gave free enterprise such an abysmal reputation.

I'm a practicing Catholic: part of an outfit that's thousands of years old, rooted in eternity, with a mandate to teach people to love their neighbors. We're also forbidden to "make" people change their minds. (Catechism, 2106)

It's been slow going, but we have made progress:

Investment Ethics

"...By contrast, though, many far-sighted managers today are becoming increasingly aware of the profound links between their enterprise and the territory or territories in which it operates. Paul VI invited people to give serious attention to the damage that can be caused to one's home country by the transfer abroad of capital purely for personal advantage[95]. John Paul II taught that investment always has moral, as well as economic significance[96]. All this - it should be stressed - is still valid today..."
("Caritas in Veritate," 40)
I'm going to 'turn up the volume' on the emphasis Benedict XVI gave in one sentence:
"John Paul II taught that investment always has moral, as well as economic significance[96]."
("Caritas in Veritate," 40)
In recent (by my standards) years, my wife and I noticed 'SRI,' or 'socially responsible investing' show up in financial planning literature. I'm 60: and never assumed that Social Security would 'take care of everything.' That's not quite another topic.

Some of the SRI packages were of the 'save the gay and lesbian codependent whales' variety: probably well-intentioned; and quite likely popular with folks who hadn't noticed the passing of bell bottoms and disco.

Other packages made a little more sense, at least for folks who think it's immoral to invest in tobacco or demon rum.

I'll grant that there's medical research, real research, not the 'cancer causes cell phones' stuff, demonstrating a link between excessive use of tobacco and lethal medical problems. Alcohol abuse is real: and that's another topic.

Not All CEOs are Rapacious Twits

I think this bears repeating. Benedict XVI, in addition to saying that ethics matter in business and investment, said:
"...many far-sighted managers today are becoming increasingly aware of the profound links between their enterprise and the territory or territories in which it operates...."
("Caritas in Veritate," 40)

Short-Term Profit; Long-Term Failure

I think this is a sort of elaboration on the old notion that 'get rich quick' schemes are a bad idea:
"...What should be avoided is a speculative use of financial resources that yields to the temptation of seeking only short-term profit, without regard for the long-term sustainability of the enterprise, its benefit to the real economy and attention to the advancement, in suitable and appropriate ways, of further economic initiatives in countries in need of development...."
("Caritas in Veritate," 40)
That papal admonition to look past the quick bucks, to what happens after the spike in profits, reminded me of this bit of:
"Which of you wishing to construct a tower does not first sit down and calculate the cost to see if there is enough for its completion?

"Otherwise, after laying the foundation and finding himself unable to finish the work the onlookers should laugh at him

"and say, 'This one began to build but did not have the resources to finish.' "
(Luke 14:28-30)
Sure, Luke was writing about dedication to following Jesus: but I think it the idea of understanding the costs - and implications - of a decision can be applied to other situations.

Employment isn't Exploitation

I suspect that this is one of the places where "Caritas in Veritate" is supposed to be "purposefully vague." Benedict XVI doesn't say:
  • Exporting investment and skills is good
  • Providing employment in another country is bad
I think there's a good reason for this apparent 'vagueness.' It's not that simple. Not in this case:
"...It is true that the export of investments and skills can benefit the populations of the receiving country. Labour and technical knowledge are a universal good. Yet it is not right to export these things merely for the sake of obtaining advantageous conditions, or worse, for purposes of exploitation, without making a real contribution to local society by helping to bring about a robust productive and social system, an essential factor for stable development."
("Caritas in Veritate," 40) [emphasis mine]
I've run into folks who quite sincerely fear that the 'beautiful people' in some remote spot will be 'ruined' by vile American greed.

I'm not at all happy about some of my native culture's tendency to value possessions over principles. On the other hand, I don't think that there's virtue in depending on antique technology and dubiously dependable weather for food, clothing, and shelter.

I do think that Benedict XVI has the right idea: learning skills and making a living are good. Getting ripped off is bad.

Besides, taking the long view: I hope that folks all over the world become reasonably prosperous. On a material level, it'll mean better living conditions for everyone: and more markets for countries whose people have been keeping up with contemporary tech.

I don't necessarily count on this, but there's always the chance that folks who don't have to concentrate on not starving this season may decide to "seek the truth." (Catechism, 2467) On the other hand, maybe they'll watch Gilligan's Island reruns. But at least they'll have more options.
More posts about "Caritas in Veritate" (Charity in Truth)
"Caritas in Veritate"

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What's That Doing in a Nice Catholic Blog?

From time to time, a service that I use will display links to - odd - services and retailers.

I block a few of the more obvious dubious advertisers.

For example: psychic anything, numerology, mediums, and related practices are on the no-no list for Catholics. It has to do with the Church's stand on divination. I try to block those ads.

Sometime regrettable advertisements get through, anyway.

Bottom line? What that service displays reflects the local culture's norms, - not Catholic teaching.