Advertisement

Economy of Mutuality

  • Kevin T. JacksonEmail author
Chapter
Part of the Virtues and Economics book series (VIEC, volume 1)

Abstract

The paper develops a triad of business archetypes. In each archetype, alternative emphasis goes to elements of profitability and financial independence on the one hand, and poverty alleviation and solidarity on the other. Archetype 1: Business enterprises conducted primarily as for-profit institutions to the end of financial sustainability. Financial self-reliance is a precondition of a firm’s survival and for remaining capable of continuously expanding products or services to new clientele. Archetype 2: The social and financial missions of business enterprises are merged; a coordination of social and financial functions is at the heart of the “promise” of the company as a sustainable enterprise. Archetype 3: Businesses are run with principal allegiance to social missions – outreach to the poor, environmental rectitude, and other facets of sustainability.

The paper argues that the trio of archetypes also serves as alternative teleolog ical exemplars of the purpose and nature of business. Archetype 1 presupposes the essence of business as profit maximization. Under Archetype 2, business is a means for creating varieties of value for a broad range of stakeholder s. For Archetype 3, the purpose of business is serving the common good, with profits secondary and derivative.

Keywords

Corporate Social Responsibility Supply Chain Market Economy Cultural Capital Social Enterprise 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

References

  1. Abela, A. 2001. Profit and More: Catholic Social Teaching and the Purpose of the Firm. Journal of Business Ethics 1 (2): 107–116.CrossRefGoogle Scholar
  2. Aquinas, T. 1273/1972. Summa Theologiae, ed. T.C. O’Brien. London: Eyre and Spottiswoode.Google Scholar
  3. Aristotle. 1941. The Basic Works of Aristotle, ed. R. McKeon (B. Jowett, Trans.). New York: Random House.Google Scholar
  4. Armendariz, B., and A. Szafarz. 2011. On mission drift in microfinance institutions. In The Handbook of Microfinance, ed. B. Armendariz and M. Labie, 341–366. Singapore: World Scientific.CrossRefGoogle Scholar
  5. Becchetti, L., A. Pelloni, and F. Rossetti. 2008. Relational goods, sociability, and happiness. Kyklos 61: 343–363.CrossRefGoogle Scholar
  6. Billis, D. 2010. Hybrid Organizations and the Third Sector. Basingstoke: Palgrave Macmillan.CrossRefGoogle Scholar
  7. Boyd, B., N. Henning, E. Reyna, D.E. Wang, and M.D. Welch. 2009. Hybrid Organizations: New Business Models for Environmental Leadership. Sheffield: Greenleaf.Google Scholar
  8. Buchanan, J., and G. Tullock. 1962. The Calculus of Consent: Logical Foundations of Constitutional Democracy. Indianapolis: Liberty Fund.CrossRefGoogle Scholar
  9. Buğra, A., and K. Arğatan. 2007. Reading Karl Polanyi for the Twenty-First Century: Market Economy as a Political Project. Basingstoke: Palgrave Macmillan.Google Scholar
  10. Calvez, J., and M. Naughton. 2002. Rethinking the Purpose of Business. Notre Dame: University of Notre Dame Press.Google Scholar
  11. Collins, J.C., and J.I. Porras. 1994. Built to Last: Successful Habits of Visionary Companies. New York: Harper Business.Google Scholar
  12. Daly, H., and J.B. Cobb. 1990. For the Common Good: Redirecting the Economy Towards Community, the Environment and a Sustainable Future. London: Green Print.Google Scholar
  13. de Tocqueville, A. 1994. Democracy in America, ed. J.P. Mayer, vol. 2 (G. Lawrence, Trans.). London: Fontana.Google Scholar
  14. Dees, J.G. 1998. Enterprising Nonprofits. Harvard Business Review 76 (1): 54–67.Google Scholar
  15. Dohmen, T., et al. 2009. Homo reciprocans: Survey Evidence on Behavioural Outsomes. Economic Journal 119 (536): 592–612.CrossRefGoogle Scholar
  16. Durkheim, E. 1893. The Division of Labor in Society. New York: Macmillan.Google Scholar
  17. Duska, R.E. 1997. The Why’s of Business Revisited. Journal of Business Ethics 16 (12/13): 1401–1409.CrossRefGoogle Scholar
  18. Faldetta, G. 2011. The Logic of Gift and Gratuitousness in Business Relationships. Journal of Business Ethics 100: 67–77.CrossRefGoogle Scholar
  19. Fearn, H. 2014. Mars Tries to Share Benefits of Business Without Parting with Profits. The Guardian. 4 November. http://www.theguardian.com/sustainable-business/2014/nov/04/mars-business-benefits-without-sharing-profits.
  20. Freeman, R.E., and D. Newkirk. 2008. Business as a human enterprise. In Rethinking Business Management: Examining the Foundations of Business Education, ed. S. Gregg and J.R. Stoner Jr., 139–143. Princeton: ISI.Google Scholar
  21. Freeman, R.E., J.S. Harrison, A.C. Wicks, B.L. Parmar, and S. de Colle. 2010. Stakeholder Theory: The State of the Art. Cambridge: Cambridge University Press.CrossRefGoogle Scholar
  22. Friedman, M. 1962. Capitalism and Freedom. Chicago: University of Chicago Press.Google Scholar
  23. Fukuyama, F. 1995. Trust: The Social Virtues and the Creation of Prosperity. New York: Free Press.Google Scholar
  24. Ghate, P. 2007. Consumer Protection in Indian Microfinance: Lessons from Andhra Pradesh and the Microfinance Bill. Economic and Political Weekly 42 (13): 1176–1184.Google Scholar
  25. Gold, L. 2010. New Financial Horizons: The Emergence of an Economy of Communion. Hyde Park: New City Press.Google Scholar
  26. Goodpaster, K.E. 2011. Goods That Are Truly Good and Services That Truly Serve: Reflections on Caritas in Veritate. Journal of Business Ethics 100: 9–16.CrossRefGoogle Scholar
  27. Grassl, W. 2011. Hybrid Forms of Business: The Logic of Gift in the Commercial World. Journal of Business Ethics 100: 109–123.CrossRefGoogle Scholar
  28. Handy, C. 2002. What’s a Business for? Harvard Business Review 80 (12): 49–55.Google Scholar
  29. Harrison, L.E. 2012. Jews, Confucians, and Protestants: Cultural Capital and the End of Multiculturalism. New York: Rowman & Littlefield.Google Scholar
  30. Hayek, F.A. 1948. Individualism and Economic Order. Chicago: University of Chicago Press.Google Scholar
  31. Heinberg, R. 2011. The End of Growth: Adapting to Our New Economic Reality. Gabriola Island: New Society Publishers.Google Scholar
  32. Hirschman, A.O. 1997. The Passions and the Interests: Political Arguments for Capitalism Before Its Triumph. Princeton, NJ: Princeton University Press.Google Scholar
  33. Hirst, P. 1994. Associative Democracy: New Forms of Economic and Social Governance. Cambridge: Polity Press.Google Scholar
  34. Jackson, K.T. 2004. Building Reputational Capital: Strategies for Integrity and Fair Play That Improve the Bottom Line. New York: Oxford University Press.Google Scholar
  35. Kay, J. 1991. Economics of Mutuality. Annals of Public and Cooperative Economics 62 (3): 309–313.CrossRefGoogle Scholar
  36. Keohane, R.O., and J.S. Nye. 2000. Globalization: What’s New? What’s Not? (and so What?). Foreign Policy 118: 104–119.CrossRefGoogle Scholar
  37. Marshall, A. 1920. Principles of Economics. London: Macmillan.Google Scholar
  38. Melé, D. 2009. Integrating Personalism into Virtue-Based Business Ethics: The Personalist and the Common Good Principles. Journal of Business Ethics 88 (1): 227–244.CrossRefGoogle Scholar
  39. Menning, C.B. 1993. Charity and State in Late Renaissance Italy. Ithaca: Cornell University Press.Google Scholar
  40. Mill, J.S. 1848. The Principles of Political Economy with Some of Their Applications to Social Philosophy. London: Savill and Edwards.Google Scholar
  41. Montgomery, R. 1996. Disciplining or Protecting the Poor? Avoiding the Social Costs of Peer Pressure in Micro-credit Schemes. Journal of International Development 8 (2): 289–305.CrossRefGoogle Scholar
  42. Nee, V., and R. Swedberg. 2005. The Economic Sociology of Capitalism. Princeton: Princeton University Press.Google Scholar
  43. O’Brien, T. 2009. Reconsidering the common good in a business context. Journal of Business Ethics 85: 25–37.CrossRefGoogle Scholar
  44. Paine, L.S. 2003. Value Shift: Why Companies Must Merge Social and Financial Imperatives to Achieve Superior Performance. New York: McGraw Hill.Google Scholar
  45. Phillips, R. 1997. Stakeholder Theory and a Principle of Fairness. Business Ethics Quarterly 7 (1): 51–66.CrossRefGoogle Scholar
  46. Polanyi, K. 1944/2001. The Great Transformation: The Political and Economic Origins of Our Time. 2nd ed. Boston: Beacon Press.Google Scholar
  47. Porter, M., and M. Kramer. 2011. Creating Shared Value: How to Reinvent Capitalism and Unleash Wave of Innovation and Growth. Harvard Business Review 89 (1/2): 63–70.Google Scholar
  48. Ricardo, D. 1817. On the Principles of Political Economy and Taxation. London: Murray, Rogers, Everett.Google Scholar
  49. Rosenberg, R., A. Gonzalez, and S. Narain. 2009. The New Moneylenders: Are the Poor Being Exploited by High Microcredit Interest Rates? CGAP Occasional Paper No. 15. Washington, DC: CGAP.Google Scholar
  50. Sandberg, J. 2012. Mega-Interest on Microcredit: Are Lenders Exploiting the Poor? Journal of Applied Philosophy 29 (3): 169–185.CrossRefGoogle Scholar
  51. Sertial, H. 2012. Hybrid Entities: Distributing Profits with a Purpose. Fordham Journal of Corporate & Financial Law 17:261–297.Google Scholar
  52. Sison, A.J.G. 2007. Toward a Common Good Theory of the Firm: The Tasubinsa Case. Journal of Business Ethics 74 (4): 471–480.CrossRefGoogle Scholar
  53. Sison, A.J.G., and J. Fontrodona. 2011. The Common Good of Business: Addressing a Challenge Posed by Caritas in Veritate. Journal of Business Ethics 100: 99–107.CrossRefGoogle Scholar
  54. Smith, A. 1759/1976. The Theory of Moral Sentiments. Oxford: Clarendon Press.Google Scholar
  55. Solomon, R.C. 2004. Aristotle, ethics and business organizations. Organization Studies 25 (6): 1021–1043.CrossRefGoogle Scholar
  56. Uelmen, A. and, L. Bruni. 2006. Religious Values and Corporate Decision Making: The Economy of Communion Project. Fordham Journal of Corporate & Financial Law 11: 645–648.Google Scholar
  57. Wals, A.E.J. 2007. Social Learning Towards a Sustainable World: Principles, Perspectives, and Praxis. Wageningen: Wageningen Academic Publishers.CrossRefGoogle Scholar
  58. Yunus, M. 2007. Banker to the Poor: Micro-Lending and the Battle Against World Poverty. New York: Public Affairs.Google Scholar
  59. ———. 2011. Building Social Business: The New Kind of Capitalism that Serves Humanity’s Most Pressing Needs. New York: Public Affairs.Google Scholar

Copyright information

© Springer International Publishing AG 2017

Authors and Affiliations

  1. 1.Solvay Brussels School of Economics and ManagementUniversité libre de Bruxelles (ULB)BrusselsBelgium

Personalised recommendations