• News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
BW Businessworld

To Maintain Capitalism, Businessmen Must Be Crusaders For General Public Interest: Prof. Dirk Matten, York University

In his lecture called ‘Reimagining Capitalism- A new exciting agenda for business leaders’, Professor Matten said, “We have to think of alternative ways of doing capitalism, as the current mode is not working. The critique of capitalism is normally looked at as a leftist argument"

Photo Credit :


On the Centre for Responsible Business Founding Day Lectures, organized on 14th November at India Habitat Centre, four eminent professors and academicians spoke on the different facets of sustainability, which included Professor Dirk Matten, Hewlett-Packard Chair, Schulich School of Business, York University, Toronto; Professor Klaus Lesinger, University of Basel, Switzerland, President, Global Values Alliance and UN Special Advisor on the Post-2015 Agenda; Professor Pawan Budhwar, International HRM, Co-Director of Aston India Centre for Applied Research, UK & Board Member, Centre for Responsible Business; and Dr Bimal Arora, Chairperson, Centre for Responsible Business, Faculty Aston Business School, Birmingham, UK. “The journey of CRB has been a great journey. Through 6 years we have worked with governments, businesses and other stakeholders which have given us a range of experiences. It’s an honour to have distinguished guests here at the Founding Day Lectures of CRB”, said Dr. Arora, opening the session on the 6th anniversary of CRB’s launch, with Professor Budhwar chairing the session.

In his lecture called ‘Reimagining Capitalism- A new exciting agenda for business leaders’, Professor Matten said, “We have to think of alternative ways of doing capitalism, as the current mode is not working. The critique of capitalism is normally looked at as a leftist argument. The crisis has always been something capitalism has suffered from, over cyclical periods. Historically capitalism has proven to be quite resilient. We see a lot of climate change happening, and global disorder. We see different forms of democracy rising that are happily compatible with authoritarian regimes. We also see unprecedented degrees of economic inequality. Capitalism always had 2 systemic problems- one was the cyclical ups and down, and an inherent trend to inequality in accumulated individual wealth”. Matten also went on to add, “The 20th-century solutions were government intervention and public, anti-cyclic expenditure, which were Keynesian policies. There were also attempts at welfare state institutions, income redistribution, and market regulation. There is a failure of the current system of capitalism because the global scale of economy is beyond the reach of nation-state governments, and weakening of regulation and welfare state provision”.

“We see structural problems where tools and mechanisms for addressing inequality no longer exist. Dominic Barton said- Business leaders today face a choice. We can reform capitalism, or we can let capitalism be reformed for us, through political measures and the pressures of an angry public”, added Matten. He concluded by saying, “There are three main areas of action- Fighting short-termism in business, correcting the focus on shareholders, and introducing an ownership mindset. There is no single ‘blueprint’ for capitalism. There have always been varieties of capitalism. The implications from a CSR angle, business might be an economic actor, but it also has a social and political role. Hoffman said- If we are to maintain our free capitalistic economy, enlightened businessmen must intensify their activities as crusaders for the general public interest”.

In his presentation, called “The theory of philosophical concepts and the reality of business practice”, Professor Lesinger began by saying, “We have a much vital challenge at the moment, which is transforming the world through the 2030 Agenda for Sustainable Development. Companies responsibility for sustainable development is one of the main pillars here. Immanuel Kant said you act in a way which is right because it is the right thing to do, not because there is a business case to it. Moral autonomy is central to humanity. Every one of us has the opportunity, if not the duty to think about what is the impact of my business, what I ought to do. In the long-run, you have to be successful, and that’s what sustainable development is about.”  He quoted John Rawls, saying “John Rawls said that individuals should make their deliberations and decisions behind a ‘veil of ignorance’, assuming they might find themselves as those affected by the decision concept of ‘original position’. All members of society must have meaningful options, the state must ensure distributive justice. Erich Fromm said that capitalism is a societal and economic order which hinders the unfolding of human powers and impedes human growth. The (needed) new man should be willing to give up all forms of having in order to fully be; find joy in giving and sharing, not hoarding an exploiting; reduce greed and show love and respect to life in all its manifestations.”

“We live in a time where we have the biggest societal reform ahead of us, the 2030 agenda, but in an environment of distrust. Business ethics, being part of applied ethics has to examine the moral issues arising in a business context and develop principles to improve the ethical quality of the business as usual. Corporate management must be familiar with all economic, social, environmental as well as sustainability knowledge relevant in the context of internal and external impacts of its work in the core competence and supply chain”, said Lesinger. He also added, “Corporate management should reflect on the available knowledge and use moral imagination to find strategies that allow for an optimal profit with the least negative internal and external impact on society, environment, and future generations. Increasing consensus on basic elements of a good society, on a fair societal distribution of responsibility and on strategic and behavioural commandments with regard to the creation of more options for future generations”. Lesinger concluded by saying, “There is a need to disaggregate, contextualize and specify. Yes, we can learn a lot from philosophical wisdom, but we have to contextualize and apply it in a situation ethics way.”

The next 3 days, 15th to 17th November will see the India and Sustainability Standards 2017 conference organized by Centre for Responsible Business in full action, with various crusaders, thought-leaders, and stakeholders of sustainability being speakers and panelists.