Why don’t businesses have social responsibilities? If they’re an invention by man, shouldn’t they serve best his interests and his goals? Shouldn’t we be able to create corporations which channel capital and manpower into something more than just relentless pursuit of profit?
This was something I struggled with my first few businesses. It seemed to me that, if I could think of a smart enough way, I could both build a business which both maximized profits and maximized goodwill returned to society.
I quickly learned that markets don’t respond primarily to morality, or goodwill. In fact, often times it’s quite the opposite.
Corporations cannot behave according to common human morality, because they are accountable to different systems. They must create profits simply to continue existing against entropy. Understand, they must maximize profit in the way we must breathe.
Granted, some corporations market themselves as being good for the environment, as being good for their employees, and as being good for their suppliers. This is really an excuse to charge a premium and maximize profits.
But let’s pretend we’re really serious, we want to change the world with compassionate corporations.
Here’s my question:
What makes you think you know what’s better than an entire world full of people choosing where to spend their dollars?
We have representative governments to impose moral order on the market.
As a business person, you need to have a second set of morals. Your business morality should look to profit maximization above all else.
Because the market doesn’t tell you the ways people imagine a fair world should work.
The market tells you the way the world actually works.
The beauty of the market is its amoral nature. We aren’t accountable to other people’s ideas of what we should be spending our money on.
Understand, when McDonald’s competes for your dollar, it is competing against hookers, drugs, and booze. Any morality it emanates has been engineered to extract more profit.