Monday, April 7, 2014

Vocation of the Business Leader

I wanted to share a link to a great document (in PDF format if you'd like to save it) on the teachings of the Roman Catholic Church on business. 

When businesses and market economies function properly and focus on serving the common good, they contribute greatly to the material and even the spiritual well-being of society. Recent experience, however, has also demonstrated the harm caused by the failings of businesses and markets. The transformative developments of our era—globalisation, communications technologies, and financialisation — produce problems alongside their benefits: inequality, economic dislocation, information overload, financial instability and many other pressures leading away from serving the common good. Business leaders who are guided by ethical social principles, lived through virtues and illuminated for Christians by the Gospel, can, nonetheless, succeed and contribute to the common good.  

Obstacles to serving the common good come in many forms —lack of rule of law, corruption, tendencies towards greed, poor stewardship of resources—but the most significant for a business leader on a personal level is leading a “divided” life. This split between faith and daily business practice can lead to imbalances and misplaced devotion to worldly success. The alternative path of faith-based “servant leadership” provides business leaders with a larger perspective and helps to balance the demands of the business world with those of ethical social principles, illumined for Christians by the Gospel. This is explored through three stages: seeing, judging, and acting, even though it is clear that these three aspects are deeply interconnected.

SEEING the challenges and opportunities in the world of business is complicated by factors both good and evil, including four major “signs of the times” impacting business. Globalisation has brought efficiency and extraordinary new opportunities to businesses, but the downsides include greater inequality, economic dislocation, cultural hcultural homogeneity, and the inability of governments to properly regulate capital flows. Communications Technology has enabled connectivity, new solutions and products, and lower costs, but the new velocity also brings information overload and rushed decision-making. Financialisation of business worldwide has intensified tendencies to commoditise the goals of work and to emphasise wealth maximisation and short-term gains at the expense of working for the common good. The broader Cultural Changes of our era have led to increased individualism, more family breakdowns, and utilitarian preoccupations with self and “what is good for me”. As a result we might have more private goods but are lacking significantly in common goods. Business leaders increasingly focus on maximising wealth, employees develop attitudes of entitlement, and consumers demand instant gratification at the lowest possible price. As values have become relative and rights more important than duties, the goal of serving the common good is often lost. 

JUDGING: Good business decisions are those rooted in principles at the foundational level, such as respect for human dignity and service to the common good, and a vision of a business as a community of persons. Principles on the practical level keep the business leader focused on: 
  • producing goods and services that meet genuine human needs while taking responsibility for the social and environmental costs of production, of the supply chain and distribution chain (serving the common good, and watching for opportunities to serve the poor); 
  • organising productive and meaningful work recognising the human dignity of employees and their right and duty to flourish in their work, (“work is for man” rather than “man for work”) and structuring workplaces with subsidiarity that designs, equips and trusts employees to do their best work; and
  • using resources wisely to create both profit and well-being, to produce sustainable wealth and to distribute it justly (a just wage for employees, just prices for customers and suppliers, just taxes for the community, and just returns for owners).

ACTING: Business leaders can put aspiration into practice when they pursue their vocation, motivated by much more than financial success. When they integrate the gifts of the spiritual life, the virtues and ethical social principles into their life and work, they may overcome the divided life, and receive the grace to foster the integral development of all business stakeholders. The Church calls upon the business leader to receive—humbly acknowledging what God has done for him or her —and to give—entering into communion with others to make the world a better place. Practical wisdom informs his or her approach to business and strengthens the business leader to respond to the world’s challenges not with fear or cynicism, but with the virtues of faith, hope, and love. This document aims to encourage and inspire leaders and other stakeholders in businesses to see the challenges and opportunities in their work; to judge them according to ethical social principles, illumined for Christians by the Gospel; and to act as leaders who serve God.

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