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Thursday, July 9, 2009

The Pope on Corporate Responsibility – Should Religions Comment on Business Ethics and Should Businesses Listen ?

Pope Benedict XVI issued his latest encyclical “Caritas In Veritate”(Charity in Truth) earlier this week. It contains many views on the international economic system, on economic development, on the role of companies and investors and on other issues of interest to Corporate Responsibility practitioners.

I have always been interested in the overlap between religion and business. Many religious traditions have comprehensive guidance on issues of business ethics but I struggle with how we can bring the ideas into our corporate responsibility dialogue without compromising the separation of religion and business at a doctrinal level. In the interests of full disclosure, I describe myself as an observant Progressive Jew.

Marc Gunther refers to the overlap between faith and business in his book Faith and Fortune. In his excellent blog “On the Move” Bill Marriott sometimes refers to his religious convictions as a Mormon. In this post he references both the overlap and separation between his religious convictions and Marriott’s positions.

Back to the Pope and “Caritas In Veritate”. It is a pretty accessible text and I thoroughly enjoyed reading it. I was encouraged to read a religious text with specific and contemporary commentary on issues of the economy, globalization and the corporate world.

You will read significant criticism of some corporate activities such as “Among those who sometimes fail to respect the human rights of workers are large multinational companies as well as local producers” (paragraph #22). But also there is significant discussion of the broadest principles of CR and sustainability across the corporation;

- The role of profit is important but not the exclusive role of the corporation (#21)
- Recognition of the problems of short term investment and decision making (#22)
- Comment on the responsibility of the company to the broad range of stakeholders (#40)
- The role and responsibility of the stakeholder (including management employees, consumers and investors) as drivers of the corporate world (#40, #65, #66).
- The evolution of social enterprises (#46)

It is worth a read, and I would love to hear what you think about whether religion has a role in suggesting guidelines for business and where the appropriate boundaries might be.


  1. I think this question has to be answered at multiple levels. At a subconscious, cultural, almost primal level it is almost impossible to separate out religious influences from most conceptions of ethics, even ethical traditions that explicitly reject religion. Where did conceptions of human rights originate for example?

    At another level, it is important to separate out the moral order of someone operating in a business role compared to their moral order as an individual. Businesses value and prioritize certain behaviors that might not be valued or prioritized so much in an individual's private life. Whereas religious ethics might prioritize giving fish and loaves away immediately, business ethics might prioritize saving the fishes and loaves until there are enough to buy a boat.

    On the other hand, individuals should never be required to abandon their morality, just because they happen to be operating in a business. It would be a poor world if businesses didn't allow individuals to honor their religions, or if business owners weren't able to express their values through their business operations.

    So now we get to the question of whether religious figures and institutions have a right to comment on business ethics, and in a pluralistic society that answer is yes. Businesses have a right not to hear, respond or react to the comments, but some would say that they've done too much of that already.

    The truth is that I think we have built many "stovepipes" and "silos" in our society and created artificial rules that tend to separate and isolate the various systems and institutions so that they don't fit together very well all the time.

    Perhaps a little more cross-sectoral, cross-institutional dialogue might be a good thing.

  2. Of course business should "listen". Important business lessons can be learned from the Pope's encyclical, I am sure. Just as important business lessons can be gleaned from any well thought out and reasoned treatise on values and ethics in running a business.

    My concern with your post is that you refer to "business" as if it were some sort of human being capable of making its own decisions. When in reality it is people in business who make decisions, write policy and decide how resources are allocated.

    You say you "struggle with we can bring the ideas into our corporate responsibility dialogue without compromising the separation of religion and business at the doctrinal level." The struggle would exist it seems to me only if you mean that the ideas would be adopted because of their source, instead of the idea offering appropriate guidance on the right thing to do.

    One of the challenges of our time is the separation of personal values from the power we have in our lives, weather in our work, play or family. And I must say that Stephen Jordan in his comment captures the "problem" for me beautifully when he talks about personal morality being somehow different that the moral values one has in their business lives.

    There is a healthy dialogue going on about Faith in the work place. There are deep sensitivities that are involved, especially when as, say, Ken Melrose, former CEO of Toro had required New Testament bible studies with his senior executive team.

    The opportunity brought by offerings such as "Caritas in Veritate" is to incorporate them into what I would hope is a discussion inside the corporation of what is right and wrong in conducting the business.

    And with respect this dialogue needs to happen outside the context of a defined "corporate social responsibility practice." It is the CEO and each board member and each executive who must be confronted with the questions of what values underlie the conduct of the business. When important decisions are made that impact the lives of workers that impose risks on customers, that impact the larger world around us -- how do you decide what is best/right.

    For some time now the prism has been that of money and shareholder values and profits. What values or morality does that represent?

    George Mitchell recently said when accepting his appointment as Middle East envoy that even though many people believed his task to be impossible, he on the other hand believed that it was human beings, people, who decide to go to war and that these same human beings could decide to make peace.

    It is human beings inside corporations that make decisions. And they bring their entire selves into that position. The discussion of the values that ought to be reflected in the decisions they make on behalf of the company needs to be robust.

    Thanks for the provocative post Kevin. I am discussing this issue from a different perspective in my blog at

    The project is on Power and Values -- how powerful people can make decisions that reflect the highest values of justice, peace and reconciliation in the world. We would hope that people in corporations -- especially those in management and board positions -- would have an on-going conversation about their values and how they are reflected in their decisions.

  3. Stephen, Sam, thank you both for such thoughtful and stimulating responses.

    A Washington Post article highlighted for me that within an individual church there can be plenty of differences of opinion on how to apply religious guidance. Along the lines of Stephen's wonderful example of the fishes and loaves, the article reports "The document buoyed the left wing of the Roman Catholic Church, which focuses on the church's social justice teachings, and disappointed some socially conservative Catholics, who emphasize wealth creation and believe in the market's capacity to empower the poor."


  4. Great topic Kevin,

    I have two comments.

    First is another example of religion and CSR. The Roman Catholic Church is not alone in suggesting practices of businesses. Elaine Cohen yesterday posted an article on the Bahai Faith's intertwining of faith and CSR. "Bahai CSR Activism"

    Second is the issue of the strength of CSR of any company is dependent upon the degree of alignment with the company's core values and core strengths. Same is true of individuals. The more aligned an individual's actions are with their core values and competencies, the better their performance and ease with which they make their decisions.

    Corporations, yes, are made up of individuals, and they behave collectively as single corporeal units. They have collective values (whether or not they are the same as what is written on the boardroom plaque). CSR Strategy is about aligning the corporate actions/behaviors/strategies at every level to get the best performance.

    Sometimes corporations, just like individuals, need reminding from the outside, just what those core values "ought" to be. For individuals, they turn often turn to religion and religious leaders for guidance.

    CSR is about integrity and alignment with your values - corporate or otherwise.

    Matthew Rochte
    CSR/Sustainability Consultant

  5. hi, (and thanks Matthew for the reference to my blog post).. I think religion is a set of value systems and these are just as relevant in the business context as they are in the lives of individuals in and ouside of the business context. Megatrends 2010by Patricia Aburdene is almost all about spirituality and its interrelation with business whether as structured religion or as an unstructured belief in some guiding spirit. And whether business likes it or not, it has to take account of the new spiritual wave of consumers, employees, interests. Sharia and islamic investment principles is another example of the inseparability of these. Religion is a stakeholder of business and as such needs to be on the radar.

    good debate.