The last few years have been characterised by growing disquiet among an increasing section of the public over the current direction of society as a whole. Weâ€™ve seen wealth inequality become a deeply entrenched facet of the economy, with wages at the bottom stagnant in the face of soaring remuneration at the very top end of the scale. Some will argue that business has no responsibility to anyone other than its shareholders, and that it needs to pay top dollar to attract top talent. Nevertheless, the high-profile efforts by politicians of all stripes to claim the high ground of â€œmoral capitalismâ€ for themselves suggest that there is a concerted desire for action among the general public.
In any case, the shareholder value maximisation argument has itself come in for criticism in recent times. While a companyâ€™s share price has for decades been held up as the most important barometer of its success, there have been critics who say this has encouraged unhealthy, short-termist decision-making processes which have been to the detriment of society as a whole. There seems to be a change in the air, and the number one challenge for business is to move with the times and respond to the concerns of the wider society. After all, the vast bulk of the general public is not composed of ideologues.
The familiar complaint that ethics and profit are unsuitable bedfellows does not stand up to scrutiny. Indeed, a lack of ethics can itself threaten profitability â€” particularly in the current era of corporate social responsibility. Consumers are becoming increasingly organised when it comes to voicing their concern, and are applying pressure on businesses in a wide range of different areas. We have seen campaigns against exploitative labour practices in developing countries, as well as environmentally-unsound activities. The rise of the activist consumer has thrown something of a spanner in the works for business, and it is essential that firms find ways of rising to the challenge.
The success of the Fairtrade brand is a fine example of successful, ethically-minded consumer activism. The initiative seeks to ensure that farmers and workers responsible for producing these products are paid fairly and not subjected to unfair or manipulative practice. The Fairtrade brand has come to win a fair amount of kudos from shoppers and given the choice between a Fairtrade product and a standard item, many consumers would be minded to choose the former for its ethical credentials. Capitalism is changing, and businesses must respond to the evolving concerns of the consumer if they are to prosper â€” which means placing ethics at the heart of what they do.
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Many firms are looking to boost their ethical credentials through citizenship education and other schemes.