Sustainability Blackboard
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The Role of Business in THE FUTURE
Date: 2009-11-10 20:29:59
From the World Business Council on Sustainable Development.....From Challenge to Opportunity - The Role of Business in Tomorrow's Society...
http://www.wbcsd.org/plugins/DocSearch/result.asp?txtDocText=The%20Role%20of%20Business%20in%20Tomorrow%27s%20Society&txtDocTitle=The%20Role%20of%20Business%20in%20Tomorrow%27s%20Society
We welcome the current debate on the role of business in society. However, much of
this debate revolves around a misleading distinction between pursuing shareholder
value and demonstrating corporate social responsibility (CSR). The shareholder value school argues that the sole legitimate purpose of business is to focus on creating shareholder wealth. The less welldefined CSR school calls for operating the core business in a responsible way, sometimes through philanthropy, sometimes through voluntarily going beyond the demands of
legislation, for example in health, safety, or environmental standards.
However, as Ian Davis, Worldwide Managing Director of McKinsey and Company, has
observed, both views obscure the real relationship of business to so-called external
issues, and it is time the debate was recast. Business does good by doing business
Any successful company will both create shareholder value and operate responsibly.
In fact these amount to the same thing. Most companies benefi t society simply
by doing business. We meet customers’ needs for goods and services. We create
jobs. We pay wages and salaries. We provide for employees and families through
pensions and health plans. We innovate to create products that contribute to human
progress. We pay taxes that fund public services and infrastructure. We create
work for millions of suppliers, many of them small- and medium-sized companies.
Our search for competitive advantage leads to effi ciency, and thus to reduced
consumption of resources, less pollution, and higher quality products.
The purpose of any business that seeks to be sustainable has to be more than
generating short-term shareholder value. Simply by adding the word long-term to
shareholder value, we embrace everything necessary for the survival and success of
the company. This includes building trust among communities and maintaining
a healthy environment in which to do business. All of these benefits are created in the normal course of responding to market
signals.