Sustainable over time

Business and ethics: we discuss the issue with Sebastiano Maffettone, author of Etica Pubblica (Public Ethics) (Il Saggiatore, 2001), chief editor of the journal Filosofia e Questioni Pubbliche (Philosophy and Public Issues), lecturer of Political Philosophy and Social Ethics [ http://www.luiss.it ] and visiting professor at Harvard [ http://www.harvard.edu ] and New York.
Our discussion with Professor Maffettone is especially focused on the concept of “sustainable enterprise”.

In one of his statements, Kofi Hannan claims to “have asked corporations to behave like human beings”.
From an individual point of view, there’s a complex set of motivations underlying human behaviour. Generally speaking, the satisfaction of one’s needs
and self-interest are primary driving forces, even if successfully achieving such goals means being able to take into account surrounding circumstances and conditions. It’s a mixed attitude that any social body, such as a corporation, should also take into account. On the one hand, it’s a question of producing for selfreproduction by generating income. But, mutual care and concern for the environment is an essential prerequisite for lasting over time. And that
goes not only for the natural environment but for the environment as a whole, including things and people.

It is commonly retained, though, that to be in any way sustainable an enterprise has got to be economically successful. How does this apply to businesses operating in the fair trade sector? Is “fair trade” just “dogood gimmickery”, or is it economically viable?
A standard enterprise and a fully fledged ethicconscious enterprise are two wholly different types of business ventures. In an ethic-conscious bank or business enterprise, the core business is indeed ethical in nature. It’s a special type of business enterprise, quite unlike a standard one.
If we are to speak of “sustainability” in relation to any business enterprise, there are at least three underlying goals that type of business venture must set itself to deserve such a definition, and namely, eco-system friendliness, social fairness, and efficiency.
If lasting over time is ultimately a measure of how good any business enterprise is, then sustainability means above all ensuring such survival and continuity. Any business run according to these principles is successful. Today, what makes the difference is precisely the awareness that these criteria exist, that they are essential and must become common business lore and practice.

Do you think that there’s a general growing awareness leading consumers not to want to be party to any non-ethical behaviour by corporations that affects consumption patterns?
The principles of sustainability are indeed brought home to businesses by the realisation that public tastes and values are different from the past. When this trend is considered it is clear that ethics and the market are not after all so oxymoric, so diametrically opposed. There is a tendency to think that ethics and making a profit are on opposite sides of a great divide. The challenge is to overcome this time-worn, prehistoric mind-set that views profit as the source of all evil and see whether a life of honest labour can indeed be morally fulfilling.

What’s your idea of what an ethicallyconscious consumer may be like?
I see it as being a person with a sense of self-irony and intellectually imaginative. A young person, perhaps, with a middle to high education, an urbanite with a penchant for a farm holiday at weekends. It’s a person for whom quality and quantity are not disjointed. What’s important for this type of person is not to turn out more in order to have more, but to live softly and coherently with one’s own vision of how things ought to be.

Do you feel there’s any difference in the economic field between what’s lawful and what deserves to be morally sanctioned?
Well, here’s an extreme and graphic example to understand the difference: the U.N. legitimises war but it doesn’t morally sanction it. Corporate ethics is tenable in so far as there’s a public with tastes and values compatible with the fact that a corporation opts for running its business on sustainable grounds.
Sustainability is not cost-free. But the costs borne by a company for being sustainable are made up by earnings thanks to the company meeting public approval for its option. If public approval is to be the measure, though, it may be said that corporate economic behaviour can be lawful in the eyes of the public, but such approval cannot be taken as unconditional moral sanction. Any justification of corporate business practices falls outside such consensus dynamics. The market legitimises sustainability, but this doesn’t mean it’s justified. Acting according to given rules and standards is enough to legitimise any conduct, but its ultimate justification depends on far more complex ethical and moral issues and considerations.

That sounds rather unpropitious! Do you reckon, then, that capitalism can be legitimised but not justified?
There’s no doubt that capitalism is fully legitimised, given its widespread approval. I’m not saying, though, that it’s not justified as such. What I’m saying is that for it to be properly justified it has to tie in with some idea of wealth redistribution, so that everyone gets a share. What I’m getting at is that the legitimacy conferred upon capitalism by an approving market should go hand in hand with the moral sanction it would have if it were able to reduce the inequalities it gives rise to.

What sort of responsibilities do you think corporations will be called upon to bear in the future, seeing as they’re increasingly selling life-styles as opposed to mere finished products?
Life-styles as a line of business can be risky, making for paternalism and incompetence. A good manager can make and market a good product, but life-styles are best and most safely left to politics and religion.

Do you reckon that the economic sphere has take over from politics?
I think it’s a mixed system. For instance, what goes on in the stock-exchange is very much tied up with politics. Collecting shares and winning votes are fairly similar processes. Politics and economics are growing closer together and there’s nothing much we can do about it, seeing as it’s not an accidental occurrence but a natural evolution of affairs. Selling products and winning votes are two consensus-based processes. How consensus is gained, though, is an issue that calls into play moral sanction, which depends on what is done and how.
It’s interesting to note that the two prevailing forms of democracy, namely the ballot and the market, are both bottom-up consensus-winning and -conferring processes. It’s an upward flowing model that’s typical of the market. Moral sanction, on the other hand, is a top-down process and as such rouses ethical issues. I only hope that these two outlooks can end up meeting each other.

Do you think corporate enterprise is generally aware of what’s at stake?
Far more than ever before. Corporate enterprise is not altogether oblivious to what’s at stake. Even though businesses that work well and last long and have hence already been run according to sustainable criteria, may not be fully aware of it. Once they do become fully aware, they’ll start focusing their marketing activity directly on these aspects, underscoring in their message the fact that they enjoy general public approval, which will finally be seen as an asset to be exploited communications-wise. After all, what costs any company may have to bear in striving for and gaining sustainability is made up by winning over customers that are sensitive and react positively to this value.

Can sustainability make for the competitive edge when it comes to competing with manufacturers and markets such as those of the Far East, for instance?
Sustainability risks raising production costs and delocalisation is in any case a must to meet the requirements of an increasingly growing and expanding market. But then again, we can’t accept to compete with someone who exploits child labour or is indifferent to what effects industrial activity has on the environment. On this score, there’s no doubt that we’ve got to be ready to face irksome and drawn-out negotiations.
What’s to be hoped is that the average consumer begins to care for given criteria rather than seeing the deal at all costs, monitoring those who declare their respect for human rights to ensure that they practice what they preach.
Better standing undoubtedly makes for better economic performance. A sustainable business enterprise is first and foremost a boon and bonus for those who work in it, and in this way a positive, self-perpetuating process is set off. The fact not to be overlooked, though, is that costs are quite blatant in any enterprise of this sort, while advantages are not equally detectable balancesheet-wise. And this is essentially the problem when dealing with sustainability.

Sebastiano Maffettone recommends

The Corporation
documentary film by Mark Achbar, Jennifer Abbott, and Joel Bakan, 2004
A film whose bold allegations may not always be endorsed but that deserves to be seen for its indictment of the potential risks to be avoided.

The Merchant of Venice
directed by Michael Radford, 2005
A re-proposition of William Shakespeare’s famous drama in which the English playwright fluently and gracefully tackles the perennial problem of the role ethics play in business, where “doing business” seems to entail being blood-thirsty and lacking any scruple.

Interview by Fabio Pornaro