Thursday, May 25, 2006

Column on MarketingWeek

Joining Business Bashers

Tibor R. Machan

The UK magazine, MarketingWeek, is a case in point: A rather well edited,
comprehensive coverage of the marketing side of international business, it
sadly, embraces the theme of most academic business ethics gurus. I am
talking, once again, of CSR, the notion that the primary task of people in
business is to act socially responsibly. Managing a firm along these lines
substitutes a doctrine of public service for taking good care of owners
and investors. As if ?the public? owned the firm!

As I noted in a recent column, this idea comes from those like Ralph
Nader who hold that because some 500 years ago corporations had been
creatures of governments?the crown established them, as it did virtually
everything else that?s important in a society?today they must still do
their bidding. Which completely ignores the fact that monarchical rule
was?and still is, where it?s practiced?a fraud. No, kings, queens, and
their gang do not own the realm. No, they aren?t due anything from
supposed subjects. No, they have no divinely anointed authority to run
everything in society.

Kings and queens?and barons and dukes and the like?are posing as having
special status among us all but it is high time this is thoroughly
debunked. They are entitled to nothing special, least of all arranging,
regimenting things in various countries around the globe. Nor is society,
which is no entity but a bunch of various individuals.

And, thus, society isn?t authorized to set up corporations either. That?s
what ordinary blokes like you and I and all the entrepreneurial types
among us get to do once the ruse of monarchy and other statist myths has
finally been exposed. And with that goes the idea that when people engage
in commerce, their first duty is to serve the crown?or, as the Nader types
would have it now, society.

Still, in criticizing a recent acquisition by perfume giant L?Oreal of
The Body Shop, for 650 million pounds, the editor of MarketingWeek, Stuart
Smith, lashed out at the former (3-23-06) on grounds that the purchase as
an exercise in ?unsentimental, unreconstructed capitalism.? And he opined
that ?Sophisticated Western consumers are demanding more of trusted brands
these days: their owners must also be sound on corporate social
responsibility if they are to expect loyalty.? And although ?L?Oreal may
have ceased animal experimentation in its R&D,? Smith lamented that ?it
still uses ingredients that are animal tested.?

So there is something anti-social in making sure by means of animal tests
that ingredients of cosmetics are safe for human users? That?s not even a
matter of CSR but of rank kowtowing to the fanatical animal ?rights? crowd
which would dismiss human welfare so as to avoid offending the

Well, with friends like editor Smith at MarketingWeek, the marketing arms
of business don?t need any enemies. They can just subject themselves to
guilt-mongering from the likes of him and offer zero resistance to the
business bashers in the academy.

It would be healthy to see some courage from those who cover the
profession of business in the media, the likes of Stuart Smith; but, alas,
it seems they aren?t interested in the welfare of business. No , they
appear to have joined with the scribblers in the halls of Ivy who are
relentlessly trying to make of business a subservient group, one that,
unlike those in other honorable professions, must do pro bono work 24/7.

This, sadly, is yet another sign that even in the West there is little
clear understanding of capitalism and free markets. When the likes of Mr.
Smith can bellyache about the selfishness of commerce, those in business
may become tempted to put on the fa├žade of altruism instead of carrying on
with business as they should, conscientiously and with a clear eye to
managing firms so as to make them prosper, to bring in profit rather than
appeal to the business bashers.

Machan is RC Hoiles Professor of business ethics & free enterprise at the
Argyros School of Business & Economics, Chapman University, and a research
fellow at the Hoover Institution, Stanford University. He also advises
Freedom Communications, Inc., on public policy issues.

No comments: