One of the ways often touted that the prevailing economic ideology will pull us out of the doom-spiral of environmental destruction is through ‘social enterprise’. Companies that are ethical, that consider a wide range of stakeholders, including everyday people, and the planet, as well as those they traditionally exist to make profits for.
In the 2010s social entrepreneurs, corporate social responsibility, and ethical investing groups were all the rage. Veering sharply away from Milton Friedman’s claims that a businesses sole social responsibility was to increase profits, these ventures offered an enticing narrative; that we could do well, and do good, all at the same time.
I was part of this social enterprise boom, as a recent Commerce graduate, keen to work with businesses to ensure they were sustainable, ethical and doing good for communities. But as I worked with organisation after organisation, I realised the shadow of this silver-plated bullet was that much as the planet and people were said to be of equal concern, profit was always the ultimate priority. The growth imperative required it.
Even the most well intentioned ethics were not scalable. We could do some good, in some instances, but once it started to affect the bottom line we reached a ceiling. And over time many companies realised that marketing patter about the good they did was just as effective (and much cheaper) than the hard slog of real world systems change. So the birth of green-washing further undermined the genuine ability for companies to scale their ethics.
A recent article by Victor Billot beautifully raised this question of scalable ethics, and encourages us to take a skeptical view. He highlights that supermarkets are on one hand giving us tips on managing the cost of living crisis and the other pulling record “excess” profits, and rugby franchises care about sustainability in their advertising, but take money from Big Oil. And ultimately that “...brands keep on dodging and diving around their social responsibilities to focus on their ‘core mission’ (a return to shareholders)”.
Professor Muhummad Yunus’ original conception of a social business was an organisation that used a business model to solve a problem for community or the environment, and the investors were investing in the solving of that problem.The addition of profit making incentives came from that insidious influence the the neo-liberal, growth dependant machine exerts everywhere.
As long as profit and growth are the model, ethical considerations will always eventually be far a distant second for corporations. This isn’t to say those working in them, or starting them don’t have genuine intentions, but scalable ethics tells us these aspirations eventually reach a threshold that only a change in the driving model can truly remedy.
Photo: Author
Image by Matt Jennings used with permission https://www.instagram.com/mattojennings/