Corporate Sickness and Corporate Health

The root of many a scandal was the inflating of the real value of a company, in the interests of stock-market “shareholder value”, i.e., the quarter-by-quarter return to the shareholders.

Where a corporate culture fostered it, this stratagem was implemented whatever the cost. Figures were falsified (with the complicity of high-trust institutions and professions such as banking, auditing, accounting). Pension-funds were put at risk, in the effort to record increased assets. As a cost-cutting measure, there occurred periodic “culls” of the workforce (a situation in which workers found themselves – even more so than in Karl Marx’s description – to be mere “appendages” to the human project, rather than being integral to it).

In contrast to all this, a genuinely ethical scenario would give recognition to all stakeholders (and not just to shareholders). All would be partners in a “win-win” game – a form of human interaction generally called “community”. Indeed, in pursuit of this very ideal, there has sprung up a worldwide an organisation called “Economy of Communion” – comprising some 800 small businesses (iron/steel foundries, financial institutions, management consultancies, local shops).

However, where an amoral business “culture allows, or encourages, the pursuit of maximum financial reward at any cost” (warns Alison Maitland in the Financial Times), “a code of ethics contradicting this will fall on deaf ears”. Senior management backing is indispensable (she holds) if codes are to be taken seriously.

Ray Kinsella and John McNerney