Peter Drucker on social responsibility

A business that does not show a profit at least equal to its cost of capital is irresponsible; it wastes society’s resources. Economic profit performance is the base without which business cannot discharge any other responsibilities, cannot be a good employer, a good citizen, a good neighbor.

But economic performance is not the only responsibility of a business any more than education is the only responsibility of a school or health care the only responsibility of a hospital.

Every organisation must assume responsibility for its impact on employees, the environment, customers, and whoever and whatever it touches.

That is social responsibility. But we also know that society will increasingly look to major organizations, for-profit and non-profit alike, to tackle major social ills. And there we had better be watchful, because good intentions are not always socially responsible. It is irresponsible for an organisation to accept – let alone to pursue – responsibilities that would impede its capacity to perform its main task and mission, or to act where it has no competence.

Peter Drucker – Managing in a time of Great Change

Externalities

We’re familiar with the externalities of industrial production and consumption. They’re fairly predictable, and often visible. Even air pollution, the silent killer, is usually visible when it happens, before the poison spreads. It’s a perfect example of a negative externality – something put into the world that everyonepays for, not just the producer or the consumer.

What are the externalities of your project, program or product? What invisible outputs do you have?

  • What does your way of working with users, customers or clients say that your words leave out? How do they see you seeing them? Do they leave feeling smaller, more pressured, less competent – or with a greater belief in their ability to get better and to make a difference? (As you teach that vital knowledge and share those crucial skills, what else are you teaching?)

  • As you manage your team, how do they feel when they leave the office? What do they take home with them? What are your externalities for their families, friends and neighbourhoods?

    • What about your suppliers – the people who serve you as you serve others. What externalities do you have for the people in the photocopy shop, the electrician who comes to the office, or for your cleaners?

  • What about your suppliers – the people who serve you as you serve others. What externalities do you have for the people in the photocopy shop, the electrician who comes to the office, or for your cleaners?

Not polluting – ‘do no evil’ – isn’t nearly enough.

Contact

Next time you read an article, listen to a podcast, watch a program that you like – why don’t you get in touch with whoever made it?

Not just the person who was in it – the ones we normally notice – but the people who made it too. Drop them an email, or even that hand written note that you always think about but never get around to.

Why did you like it? Is there something you had a (generous, non-snarky) question about, or something (of genuine potential interest to them) that you can share?

Try it – make it a light touch. It feels funny at first but gets ever-easier. They’re a person like you, and they’ll probably reply, which will probably be fun.*

*You have permission to stop after twenty unreplied-to contact attempts.**
** To different people.

Debt to society

If you want to talk about our debt to society – the question of what we owe the other people who share our culture, and share the planet with us – it’s helpful to start with this: without other people, you’d be dead. Even if you’d somehow managed to be born on your own, without other people you’d never have made it.

But ‘debt to society’ is the wrong way to frame it. It helps to think less about giving-up-what-is-rightfully-ours because of what we owe (though we do), or because we feel guilty or obliged (though perhaps we should), or because we’re afraid of what will happen if we don’t (though there might be good reason for this).

What do we want?

Let’s talk instead about contributing towards what we want, and the benefits we might expect to enjoy if we lived in a kinder, more generous society. A society – just for example – in which as many people as possible get a leg-up when they’re just starting out (by being born, or starting school, or starting their careers), and the hand-up that makes all the difference when they’re down. We know that these things don’t just make it better for other people’s kids, but for our kids.* A better society is better for all of us: no-one wants unhealthy, poorly educated, tormented neighbours. (And no-one wants selfish neighbours either).

We all do want human flourishing, and most of us want it for everyone. We don’t even disagree that much about what it looks like, just about how to achieve it** and sustain it. And most people want to contribute towards achieving it.

Better

If we focus on “better”, if we say the words and describe it, it becomes much easier for people who usually disagree with us to say, “Actually, I want that too – but I think we’ll get it by doing this...” And it becomes easier for us to agree to try one way, then the other – or to find a different, better way.

And focusing on contribution towards building something better is a great story. We can feel good about what we’re giving, a part of what we’re building, and hopeful about what we’re moving towards.

*And at the end of the day, they’re all our kids.
**Perhaps particularly about whether a
flourishing life is something that can be given.