Vegan and Dangerous!

While I have made a good number of choices in my life which were not in line with the predilections and views of the majority and consequently did not always reap enthusiastic accord, so I was nevertheless unprepared for the in part fierce reactions that my decision to forthwith abstain from animal products (including milk and eggs) prompted. I have since been subjected to everything from “this is too radical” and “you vegans are all so judgmental” to “Vegan – that’s a cult!”. At times I was also just derided as if I was some airy fool or I was again attacked in the sense of “oh, so you are one of those ‘holier than thou’ do-gooders who then also wants to impose his personal morality on us.” (An excellent example of argumentum ad hominem: instead of engaging in a factual discussion, one a priori attacks the person and discredits him or her).

Wow!

On the Pope’s criticism of today’s economic thinking

Last week the Pope published his text “Evangelii Gaudium”, in which he is giving different inputs for reorienting the Catholic Church. Although I am not Catholic, I was interested in his statements about the challenges of today’s world and especially in his criticism of our current economy.

In quite a positive way, he recognizes the improvement the economic system brought to “people’s welfare in areas such as healthcare, education and communication”. Yet he blames this economy of “exclusion and inequality”. He thus asks critically, “how can it be that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points?” And he continues: “Today everything comes under the law of competition and the survival of the fittest, where the powerful feed upon the powerless.”

I was especially amazed by his criticism of issues that have also been discussed by the stakeholder theory for the past few years. One example is his critique of the free market. 

However, he makes no specific suggestions as to how extreme competitiveness could be limited. In contrast, the stakeholder theory proposes, for example, to focus more on the potential of cooperation among stakeholders, based on the resource based view of strategy, instead of pure competition: Through the cooperative pooling of resources, innovative solutions to issues, products and processes can be found, according to the stakeholder theory, which a single stakeholder who considers others only as competitors could not find. It would have been interesting to learn whether the Pope could in addition to this instrumental perspective on cooperation also offer a normative view, in his case based on the Catholic faith.

The same could be said about his criticism of the concept of human beings that prevails in economy. Certainly, many economists would agree with the Pope’s analysis that “the denial of the primacy of the human person” predominating classic economic theory is questionable or wrong. A growing number of publications are increasingly critical of the basic concepts of economic theory, in particular of the hypothesis of human self-interest. In this sense, the Pope states, “the socioeconomic system is unjust at its root.”

This criticism also calls for the question of which normative concept could form an adequate basis for a more realistic image of human nature. The Pope refers only summarily to the need for ethics: “Ethics – a non-ideological ethics – could make it possible to bring about balance and more human social order.” One can assume that he refers to Catholic social ethics. One can add here that there are also ethical approaches not tied to a specific denomination or religion, which are therefore also acceptable to non-Catholics.

Our reflections on stakeholder theory refer to a humanistic approach based on Kant. This approach considers human beings always as ends, not means, also in economic interactions. In this view, the different values, norms, interests and capabilities have to always be considered and taken into account in economic and business activities. Such a general humanistic approach not only addresses believers of a particular denomination, but its non-denominational claim makes it a fundamental norm also for economic activity.

Edwin Rühli

A viral spot reconsidered: What does language tell us about a business’ acceptance?

A viral spot (that has however not yet taken off) advocating sustainable investment as being the investment strategy of the present and future caught my attention yesterday. The video clip, initiated by an investment management group headquartered not far away from our institute in Zurich, both thrilled and puzzled me at the same time.

The clip busts several myths regarding sustainable investments in order to propagate the initiator’s investment strategy. The underlying proposition suggests that you can earn more money when your investment manager assesses the stocks’ potential of your portfolio in the most complete manner available. The approach applied by the initiator enlarges the financial analysis of firm’s performance by adding an analysis of the social and ecological performances of the firm. Apart from its rather instrumentalist application, the concept behind it—called the triple bottom line—excites me. It demands of firms to take into account their responsibilities to all stakeholders (e.g. employees or customers), not only stockholders. The result suggested in the clip may seem paradoxical: The less a firm tries to solely meet the demands of its stockholders, the merrier is the stock’s potential in the future.

However, the puzzling aspect of the clip unfolded just as I tried to connect it with my (current) research interest: the diffusion of business practices. The question arises as to how widespread the above business is. As I am eager to learn more about rhetoric theories that highlight the potency of language in shaping organizational life and behaviour, the language used in the clip awakened my interest.

From a rhetorical perspective, the way a particular practice is accompanied by language tells you a lot about its state of acceptance. The relationship between the rhetoric used by people and their social practice is theorized about in many complicated ways. A catchy—and thus highly persuading, as rhetorical theorists would say—framework was, however, introduced by the management scholar Sandy Green. As evidence of a practice’s acceptance, he proposes the lack of a need to justify it, for example in legitimating it by rationalizing the matter of subject. And what is the video clip actually doing? It’s not a typical commercial trying to persuade the audience that the initiator is better at doing its business than its counterparts. In the core, however, this clip is purely a justification of the initiator’s business practice at all. Even though it repeatedly refers to the triple bottom line as being common sense, this clip can be taken as a testimony of the rather weak penetration of this business practice even without knowing much about this business (as I definitely do not).

My puzzling to me is, therefore, the weak state of diffusion of business practice that corresponds to my very own idea of how business ought to work. However, the theory of rhetoric gives us a master plan about institutional change. Among the factors impacting whether a business practice is adopted or not, the most powerful ones are not those seeming the most efficient or the most effective, but rather the ones that make sense to the people. From a rhetorical viewpoint, you just have to talk about it long enough until a critical mass of people is persuaded. 

Christian Stutz

Fortress or kindhearted Europe?

The Italian Island Lampedusa is again in the news around the world. Once again it is because of human tragedies that took place before its coast: several hundreds of African refugees died during the attempt to cross the Mediterranean Sea in vessels. As reported in the press, between 1992 and 2012 17’000 humans already died in such attempts.

In Europe in all sorts of media there are brisk discussions, comments and reports about the topic. Two basic view points and recommendations for the future dominate in discussions: one says that to prevent such tragedies in the future Europe needs to provide the refugees more support for their plans. An example is that potential refugees should have the possibility to make a request for asylum directly in Western embassies in African states. Proponents of this view moreover think that development aid is an important part to solve the issue. They denounce also exogenous reasons for poverty like the narrowly self-interested and exploitative activities of Western (natural resources) corporations in Africa. The second fraction wants to prevent such tragedies, but by taking measures that are aimed to stop influxes of refugees over the Mediterranean Sea. This shall be achieved, for example through strengthening boarder controls on the sea massively and through establishing refugee camps already in Northern Africa. Proponents of this view primarily condemn endogenous reasons for poverty like highly corrupt and kleptocratic elites in the African states.

Overall, proponents of both views present certain constructive suggestions for solving the issue. But one main problem is that it seems like the proponents of both sides do not listen to each other. If they would do so they probably would come to the conclusion that a combination of their suggestions would be the way to come to an effective solution. The suggestions are generally not mutually exclusive (e.g. stronger boarder controls and the possibility to make a request for asylum in embassies directly). In the existing consequent separation of the view-points we possibly also can recognize that one part of Europeans act consistent to one view while the other part does so with the other. The result of quasi two parallel policies are not only uncoordinated, often there are diametrically opposed actions (e.g. Western aid trying to provide access to clean water vs. a Western corporation nearby looting resources and thereby discharging polluted water in the river).

Coordinated and coherent actions among proponents of both views and thus of different stakeholders of the issue would arguably be expedient. It would also prevent from overturning in non-expedient actions from one fraction which the other is likely to see as too extreme. Without more coordination the status quo will be kept.

A second problem is that the root causes of the issue are not really discussed. But European stakeholders should focus more on these root causes. There are, for example potentials to connect activities of corporations looting natural resources and development aid organizations. Although it is at a first glance not easy to connect such different stakeholders it is a necessity: cooperation on root causes would tame both of them and thus lead to less non-reflected or only one-side-reflected activities. In this way real opportunities could be created in Africa.

In sum, cooperation between stakeholders concerning root causes is essential. In a presentation from early 2010 at the University of Zurich an invited Historian of the University of Oxford mentioned that the European activities in North Africa were not considering the full context there. Important realities were ignored and hence a forward-looking engagement was not possible. A year later the Arab spring took place. This brought hope in the beginning, but lastly not positive perspectives for the future of young people. Instead it brought new problems and new refugees.

 

Claude Meier

 

Of American “Libertarians” and European “Common Good Economizers”

Which type of economic (and political) system one favors is largely dependent upon what kind of a notion one has of what it means to be human, more specifically, a ‘successful’ or ‘good’ human being - and by extension also a “successful” and “good” society. Yet if our prevailing economic system ought to reflect our collective values of what it means to be successful or good human beings, then it is striking just how unsatisfied we are with the status quo. According to a study by the Bertelsmann foundation, roughly 90% of all Germans and Austrians pine for a new economic system (this figure is likely to be even more striking in economically weaker countries such as those of southern Europe). While the current economic system still tends to find more champions in America than Europe, also the citizens of this largest of capitalistic nations are ripe with frustration, disillusionment and cynicism. The colloquial expression “Corporate America” has long since become synonymous with some large, deceitful bureaucratic machinery that is not governed by the principles of merit, honesty or creativity, but by its own aloof and singular logic of marketing (products and the self, as in Me, Inc.) and Washington DC lobby power.

Yet while Europeans are inclined to seek reform via a notion of human nature based on caring empathy, collective cooperation and sharing of wealth, Americans tend to look towards human success through the prism of healthy competition, individual freedom and merit-based creativity. Never mind that creativity, freedom and caring mean different things for different people, as also to most Europeans and Americans. The point, and difference, between the predominant American versus European stance to fundamental reform is in where in the hierarchy of daily self-awareness these rather ill-defined notions figure. Permit me a brief, although clearly simplified, analysis.

The American is apt to become emotionally roused by anything that threatens his or her “individual freedom” or obstructs the reaping of “merit based fruits of hard work” (both often linked to property rights). This is why Americans, even if they are among the majority of citizens who are demonstratively increasingly among the losers of the current economic system, still tend to extol laissez-faire “free markets” (note the catch word “free”) while scoffing at European notions of statism and “socialism”, which for many is nothing more than the ante-chamber to full-blown totalitarian communism. Thus, a creative, typically American response to the current problems has been in the form of “libertarianism” (See for example the “Libertarian Party” (https://www.lp.org/, or the partially aligned Tea Party movement (http://www.teaparty.org/).

The European, on the other hand, is prone to get emotionally worked up about anything that threatens his or her sense of fairness and material equity, which is looked upon as the direct result of cooperation, sharing and caring. This is why Europeans, even if they are among the relative winners of the current system, tend to still prefer an economic system that constrains wide income disparities and distributes wealth, despite state-coffers that are neigh bankruptcy, and are suspicious of “markets always know best” and are repelled by the winner-takes-all ethos so prevalent in the USA. Hence, a contemporary innovative, typically European solution to the current malaise has been in the form of an “economy of the common good” (see for example, the GWÖ http://snipurl.com/26rosb9).

While an adequate elucidation of what “libertarianism” and “common wealth economy” designate is beyond the scope of this brief analysis (the reader is encouraged to read more on it!), it is once again telling to simply look at the etymological roots of the involved wording. In as much as all words are reflections of the reality we human beings are conscious of, it is the words – and associated stories – we are personally and culturally exposed to, that create our notions of “good” and “successful”. Hence the cultural narrative of “the land of the free and home of the brave” as per the American anthem can easily be understood as freedom from governmental interference and brave, merit based self-determination, while a common European narrative as in the French motto “liberté, egalité, fraternité”, not just enjoins freedom, but notably stresses equality and brotherhood.

At the end of the day, our political leanings and thus our economic preferences are more of a function of our emotions than any rational analysis. They are formed by our personal histories as much as by the histories and stories of the countries and cultures we are part of. A fundamental question that this raises is where and to what extent an international consensus is required and even possible in creating a global economy that is socially and environmentally sustainable in the long-run. Clear is that the effective stewardship of our world economy simply requires domains where all stakeholders are not only involved but also sign on to. The process must be along the lines of libertarianism in as much as any directives cannot be imposed upon individual countries, but the results need to transcend particular interests and be more along the lines of a common good.

Manuel Dawson

Caring about the customer

 

 

In stakeholder management customers are regarded as primary stakeholders of the firm but also many a firm not pursuing general stakeholder management, does think it should be customer oriented. “Usability”, “ergonomics” and “human centred design” are no longer exceptions in strategic considerations. The customers are moving toward the core focus of business, which I think is a good development, because traditional customer orientation is not enough. A deeper and more honest relationship to the people who are buying your goods is necessary. As I see it, the primary focus should not be on how to sell more of a company’s products, but on what the person buying the product really wants (also resulting in selling more products).

I would like to illustrate this think shift: Many people like to eat healthy food. A snack company spots this customer need, puts some milk into the product and praises it as being a healthy snack, even though most nutritionists would assess the product to be of the contrary (heavily sugared and fatty). So just by recognizing and addressing the consumer need doesn’t make a customer centred firm. Another example: Consumers like the look of dark red meat (not grayish meat) because they have built the mental shortcut (heuristic) that intense color in food is a sign of freshness. This is why market research study participants would prefer the dark red meat to a grayish meat product. A company that follows what the consumer actually wants, will not sell the consumer a meat that was treated with a gas that keeps it red (but doesn’t keep it fresh), it will sell the consumer fresh meat. This is not only a shift in strategy, this will have wide implications for a company’s daily business in distribution, packaging, communication and so on.

 

We use these mental shortcuts (here: intense color equals fresh food) because they mostly lead us to making good decisions (read publications by Gerd Gigerenzer for more on this topic). Shortcuts make life easier; especially in this fast paced, information-overloaded environment. These heuristics are good because they are often based on experience and implicit knowledge. But the shortcut only works if it is not tampered with by others. Robert Cialdini, a social psychologist, wrote several books on persuasion, summarizing his findings based on many experiments he had made in his research on e.g. selling tactics. But he states “Just because a given [powerful psychological] principle is successful does not mean we are ethically entitled to commission its persuasive power to create change.” I think this misusing psychological mechanisms such as heuristics is not only unethical it is also a strategy that won’t lead to sustainable business success. A company that shares its purpose (the “why” of a company) with its customers and therefore wants the same thing, will be able to engage the people they call their customers and conquer the challenges (such as resource scarcity) together in an innovative way, and of course sell their products.

 

Vanessa McSorley

A doctoral student’s view on plagiarism affairs

Yesterday, a scholarly commission of a German university has decided to revoke the doctorate of the country’s education minister and a close confidante of the chancellor on the basis of plagiarism.1 What seems to be the latest instance of a series of similar affairs not only raises again questions about the integrity of involved, mostly high-ranking individuals of public or political interest, but also about the justness of stripping academic titles most often earned decades ago. Without being a legal expert, it seems convenient to me to turn this discussion into a rudimentary trial, presenting incriminating evidence and exonerating circumstances as judged by a protagonist and stakeholder theorist’s point of view.

Provided that the authors knew what they were obliged to do when writing scientific pieces in which they relied on the ideas of others (intent?), there is undeniably ethical ambivalence behind “…systematically and deliberately faking a mental performance throughout the entire dissertation…”.2 The driving force of misbehavior can comprehended to a certain extent; metaphorically think of a school kid who decides to take on the risk of cheating at an exam in hope of getting away with it and gaining the respect of his/her mates for being the best in class. Also the personal choice to jeopardize one’s sincerity and take on the burden of living with and even building a career upon a skeleton in the closet could be acceptable as long as nobody else is harmed and consequences are taken if it does come out.

From a broader and more stakeholder-oriented perspective, the quality and originality of single research efforts is certainly of interest for a wider range of involved individuals and institutions (failure to render assistance?). Ultimately, the reputation and trust in academic education and the community itself is at stake. In my opinion, the setting in which such major research projects are developed is essential in preventing misbehavior. By actively striving after adherence to scientific principles, the set of stakeholders should provide an enabling context including ethical values. However, it seems also evident that such a setting cannot be characterized by an ever-growing pressure on young scholars to perform along one single dimension, namely the quantity of peer-reviewed publications.

Last but not least, one needs to be aware of the fact that the act of crime is in most cases several decades ago (prescription?). At that time, research was carried out and dissertations were written under nowadays inconceivable circumstances - the World Wide Web and Google & Co. did not exist. But also the means to rigorously check for plagiarism were missing, so the inhibition level for copy/paste was presumably much lower. To draw a comparison between now and then seems pointless in that regard.

The bottom line is (sentence!) that it would be wrong if long-ago decisions of individuals to violate the principle of intellectual property in order to boost their ego leads to negative sentiments towards contemporary science and the involved stakeholders.

Marc Moser

References

1 Cottrell, C. 2013. "University Revokes German Official’s Doctorate", in The New York Times, viewed on 5 February, http://nyti.ms/12wwcxN.
2 Bleckmann cited in Cottrell (2013)

Entitlement Cultures

Having recently been in Washington D.C., I was once again struck by the ever more extreme polarization of the political landscape in the United States. Everybody seems to be convinced of being “right” and “in the right” and deeply suspicious of the intentions and moral rectitude of the “others”.

Now, it is an inherent, most likely evolutionarily selected for human quality that we excel at “rationalizing” our morals, conduct and life-style. After all, fundamental self-critique hurts, and self-loathing and depression make for very poor survival strategies in the mating or professional marketplaces. Our brains are thus hard-wired and biased to avoid truths that are too uncomfortable (as long as they are not imminently life-threatening), thus keeping us feeling good about ourselves most of the time.

However, this lack of objectivity with respect to ourselves – if left unchecked - has various unsavory social, economic and political side-effects. One of these is that it engenders a culture entitlement, of which I will focus on entitlements in the form of money.

Now monetary entitlement comes in many guises: from benefiting from the modern welfare state – be it in form of assistance to families with children, the unemployed, disabled or elderly - to agricultural, defense industry and tertiary educational subsidies. Alternatively, entitlements can be in the form of generous tax breaks for home owners and investors, to simply the expected, lavish remunerations found in many professions, made possible by professional accreditation monopolies, lax economic regulations and “free market dynamics”. Now, it is hardly surprising that in all of these instances, the overwhelming majority of beneficiaries naturally feel that they are rightfully the recipients of such largesse: our incessant, narrowly targeted, interest driven political squabbling reflects this pervasive sense of having a legitimate claim upon them.

The rationalization, if we are among the losers of the current economic system, is that we were wronged by the lottery of life and/or society and are thus rightfully entitled to state support, especially in view of the great wealth amassed by the top percentiles of the socio-economic spectrum. Alternatively, if we are among the middle classes, we may consider ourselves as the “good citizen” par excellence and the hard working, solid backbone of the economy and thus reasonably entitled to various subsidies such as mortgage interest deductions, medical care benefits, early retirement and higher education. Lastly, if we are among the winners of the system and garnered considerable wealth, we are likely to attributing our success to our superior work ethic, risk taking or intelligence and thus naturally – oft also rationalized along the lines of Social Darwinism - entitled to have garnered this great wealth and consequently, for example, free to adroitly exploit the full panoply of tax loopholes.

The unfortunate corollaries of these self-assessments are however increasing suspicion towards the groups one does not belong to, resulting in rather dim views of the righteousness and fairness of their specific entitlements.

Now as long as the overall pie of wealth increased rapidly enough to sustain such entitlements, these diverse recipients – some political squabbling aside - can be kept largely quiet. Today, however, with increasing pressure on these entitlements, rising discontent and self-righteous polemics find their way into public discourse, political deliberations and increasingly also social unrest.

The question of the day now becomes as to how to best manage a social and political discourse that remains constructive, in spite of a pie that is no longer growing fast enough to sustain the status quo and keep everybody happy.

I think that a first step is the recognition that we are all recipients and that “privileges” should always be also connected with “duties”. It is to recognize and accept the fact that at the end of the day, we are not only participants, but stakeholders in a society and world that must be managed not just for our own short term benefit, but also for our collective long-term well being. It is, perhaps above all, to be willing and able to endure candid self-reflection and critique and to regain the humbleness incarnated by the expression of “privilege oblige”: of whatever sort this privilege may be. We need to recognize that we are all privileged today to have been born in an epoch in human history and a part of the world that has seen unprecedented material wealth. And that is not the doing of any one of us, but rather a historical luck of the straw.

Woody Allen, in a recent interview, impressed me with reflecting on his “successful life” with sincere modesty, highlighting not his superiority or even achievements, but his good fortune and thankfulness.

Manuel Heer Dawson