Business and the Gospels
Now that Pope Francis has cleared the air regarding his ideology, conservatives can breathe a collective sigh of relief (pun intended). Unfortunately one of the key messages in his exhortation -- that we have made money into an idol and that business ethics are now viewed with scornful derision -- seems to have gotten lost amid all the attention being placed on the messenger.
The pope's message was directed to a global audience, and aimed at many different cultures. Every country from Argentina, where there is rampant corruption, to Zimbabwe, where there is also rampant corruption, has its own take on money and what is ethical in business. But common folk, business leaders, and politicians here in the U.S. should also be taking his message to heart.
Plenty of examples of money as an idol and downright unethical business practices have been in the news over the last 10 years. Enron, Bernie Madoff, Lehmann Bros., and AIG immediately come to mind. The AIG scandal alone typifies both problems: AIG gets caught fudging the books by the SEC to the tune of $3.9 billion (i.e., commits fraud), and has to pay out almost $1.65 billion in fines. Then it posts a $61.7 billion loss and gets bailed out with taxpayer money. AIG's execs didn't lose any sleep over this shameful performance. Instead they rewarded themselves with $165 million in bonuses.
It would appear that neither Max Weber's Protestant Work Ethic (work hard, live frugally and contribute to the betterment of society by reinvesting profits earned from the business to create more jobs), nor all the classes in Business Ethics being taught at colleges and universites have been that successful in fostering truly ethical, moral approaches to how business is conducted in the marketplace. Some might even argue that there are more practioners of Gordon Gekko's 'greed is good' philosophy than of the Protestant ethic.
A number of Papal encyclicals have also been written over the last 100 years explaining the rights and responsibilities of both employers and employees from the Catholic Church's perspective. But until recently no actual guidelines, other than 'live your faith,' have ever been published on how to conduct business in a Christian/Catholic way, or how to be a good Christian/Catholic businessman.
This finally began to change in 2007, when the U.S. Council of Catholic Bishops (USCCB) issued a publication entitled Forming Consciences for Faithful Citizenship. The thrust of the publication was "A Call to Political Responsibility," but it also touched on the role of business, business owners, and workers.
52. The economy must serve people, not the other way around. Work is more than a way to make a living; it is a form of continuing participation in God's creation. Employers contribute to the common good through the services or products they provide and by creating jobs that uphold the dignity and rights of workers -- to productive work, to decent and just wages, to adequate benefits and security in their old age, to the choice of whether to organize and join unions, to the opportunity for legal status for immigrant workers, to private property, and to economic initiative. Workers also have responsibilities -- to provide a fair day's work for a fair day's pay, to treat employers and co-workers with respect, and to carry out their work in ways that contribute to the common good. Workers, employers, and unions should not only advance their own interests, but also work together to advance economic justice and the well-being of all.
While this statement reaffirms the dignity of work, it still doesn't paint a real clear picture of how a person can still be a good Christian/Catholic and a good businessman.
In his 2009 encyclical, Caritas in Veritate (Charity in Truth) 'conservative' Pope Benedict XVI, was every bit as chastising as Pope Francis on the failures of capitalism and how business is conducted, but he also opened the door a bit more on the subject of a Christian/Catholic approach to business:
40. Today's international economic scene, marked by grave deviations and failures, requires a profoundly new way of understanding business enterprise. Old models are disappearing, but promising new ones are taking shape on the horizon. Without doubt, one of the greatest risks for businesses is that they are almost exclusively answerable to their investors, thereby limiting their social value. Owing to their growth in scale and the need for more and more capital, it is becoming increasingly rare for business enterprises to be in the hands of a stable director who feels responsible in the long term, not just the short term, for the life and the results of his company, and it is becoming increasingly rare for businesses to depend on a single territory. Moreover, the so-called outsourcing of production can weaken the company's sense of responsibility towards the stakeholders -- namely the workers, the suppliers, the consumers, the natural environment and broader society -- in favour of the shareholders, who are not tied to a specific geographical area and who therefore enjoy extraordinary mobility. Today's international capital market offers great freedom of action. Yet there is also increasing awareness of the need for greater social responsibility on the part of business. Even if the ethical considerations that currently inform debate on the social responsibility of the corporate world are not all acceptable from the perspective of the Church's social doctrine, there is nevertheless a growing conviction that business management cannot concern itself only with the interests of the proprietors, but must also assume responsibility for all the other stakeholders who contribute to the life of the business: the workers, the clients, the suppliers of various elements of production, the community of reference.
Following release of the encyclical, the Pontifical Council for Justice and Peace, one of 12 standing papal councils charged with assisting the Pope in governing the Catholic Church, was charged by Benedict with following up on his call for "a profoundly new way of understanding business enterprise" and on the various business-related issues and concerns Benedict had raised in the encyclical.
In 2010 and 2011, the Council held a series of working meetings in St. Paul, MN and in Los Angeles. Out of these meetings and working sessions, attended by businessmen and women, university professors, and business experts, came a booklet entitled Vocation of the Business Leader, a 27-page guide on how to be a good Catholic/Christian businessperson.
The booklet is intended as an instructional aide for use in business programs at "schools and universities." In the booklet's forward, the role of the business leader, as viewed through the eyes of the Church, is explained:
Business leaders are called to engage the contemporary economic and financial world in light of the principles of human dignity and the common good. This reflection offers business leaders, members of their institutions, and various stakeholders a set of practical principles that can guide them in their service of the common good.
In the introduction, the booklet reaffirms what Max Weber said about business being a vocation:
6. The vocation of the businessperson is a genuine human and Christian calling. Its importance in the life of the Church and in the world economy can hardly be overstated. Business leaders are called to conceive of and develop goods and services for customers and communities through a form of market economy. For such economies to achieve their goal, that is, the promotion of the common good, they should be structured on ideas based on truth, fidelity to commitments, freedom, and creativity.
Within the five sections of the booklet, an emphasis is placed on the practice of ethics, morals, and virtue in the business world. There's a chart on page 17 of the booklet, "Six Practical Principles for Business," that might be worth framing and hanging in an office, or even incorporating into a company's mission statement.
Someone once said, 'You don't stop being a Catholic (or a Christian) when you walk in the door at work in the morning, and then start being a Catholic again when it's time to leave and go home.' And that, in nutshell, is what Vocation of a Business Leader is all about. As the fourth question in the "Checklist For The Business Leader" at the end of the document asks:
Have I been living a divided life, separating Gospel principles from my work?
As segments of the population of the U.S. have seemingly moved more and more toward secularism and away from faith and religion, more and more people, as Pope Francis said in Joy of the Gospel, are worshipping the "golden calf" -- the pursuit of wealth at any cost. Such a goal in life does nothing for an individual's growth as a human being, and doesn't help humankind much either.
So far in the history of the world, no economic system yet devised meets the needs of society quite as well as capitalism. But that is not to say that it is a perfect system. And certainly, how business is conducted and how money is used affects all of society.
One stat conservatives do not like to talk about is one that the AFL-CIO just loves to trumpet -- the difference between CEO and worker pay. In 1980 the average large company CEO received 42 times the average worker's pay. By 2010 the difference had grown to 343 times, and then jumped to 380 times in 2011. This year the difference is 354 times. So while the average worker is making $40,000 per year, the average large company CEO is making $21,240,000 per year. Such a disparity is hard to justify.
Pope Francis was correct in his criticisms of greed and unethical business practices. There is plenty of room for improvement. Maybe Vocation of the Business Leader will help.
And maybe the next booklet the Pontifical Council for Justice and Peace needs to work on should be entitled Vocation of the Politician.