I'm putting together my thoughts for my upcoming (March?) Sen. Benigno Aquino professorial chair lecture which I've entitled "Building Humane Business Organizations: Catholic Social Teaching and Corporate Governance". After reading Joel Bakan's incisive "The Corporation" and watching the DVD based on the book, I thought that it would be timely to suggest inputs for reforming corporate excesses based on Catholic social teachings, especially since quite a lot of board directors in the top Philppine corporations are Catholics who graduated from the top Catholic schools.
Bakan's main thesis is that the legal corporation as constructed is essentially an externalizing machine which is designed to pursue profit. The corporation externalizes when it acquires profits without taking responsibility for the costs and harms caused on others. As such, it is amoral and, as an artificial person, could be reasonably described as psychopathic. This point is similar Kenneth Goodpaster's description of teleopathy, or a sickness of purpose, because a corporation may be solely interested in profit at all cost.
I agree with Bakan's thesis and even with his recommendation that basic reforms are needed in corporate law to make corporations more accountable to democratic governance. A parallel approach is available, I think, through corporate governance. I believe that one way to make corporations moral is to ensure that its governance is guided by moral principles. I will try to develop these points in my lecture.
Saturday, December 31, 2005
After a term of Faith-based Management
And so the end of the term has come.
It was an interesting first run of the Faith-based Management course and I certainly learned a great deal for future runs!
The main points covered in the class were the following:
I found a number of things helpful in conducting the course:
It was an interesting first run of the Faith-based Management course and I certainly learned a great deal for future runs!
The main points covered in the class were the following:
- Managers who espouse the Christian faith often do not integrate their faith with how they work. The opportunity to achieve this integration is present through reflection guided by prayer and the regular practice of virtue in making managerial decisions. Christian managers can evolve from being secularizers or spiritualizers to being natural law, faith-based or prophetic managers.
- The difficulty of integrating faith and work is often due to the overemphasis in business organizations of pursuing foundational goods (e.g., profit and material prosperity) while neglecting excellent goods (e.g., human growth and development, the common good).
- The faith-based manager needs to move beyond foundational goods to pursue excellent goods. The purpose of the business firm is to pursue human development and the common good through the community of the firm supported by sustainable material resources. There are companies which have done this with some success such as RPM and ServiceMaster.
- The virtues of prudence, justice, temperance and courage guides the manager in pursuing human development and the common good.
- The BBC-HD Code of Ethics for Business gives a useful summary of key principles and standards for faith-based management in the Philippine setting.
- In order to pursue human development and the common good in a business, the faith-based manager needs to ensure that jobs are properly designed to respect human dignity and to promote human development.
- Providing a just wage is a crucial element in promoting integral human development and dignity. Just wages incorporate the concepts of living wage, equitable wage and sustainable wage. The living wage (based on the principle of need) is the minimum amount due to every independent wage earner by the mere fact that he or she is a human being with a life to maintain and a personality to develop. The equitable wage (based on the principle of contribution) is the contribution of an employee's productivity and effort within the context of the existing amount of profits and resources of the organization. The sustainable wage (based on the principle of economic order) is what the employer can pay given the economic health of the organization as a whole. The right of all employees of the company to be paid a living wage prevails over the right of owners/investors to earn a reasonable rate of return on their investment in the company. ESOPs, skill-based pay and gain-sharing are some approaches towards just wages.
- A wider ownership of productive property (e.g., company equity) promotes employees' development and ultimately serves the common good. Employee ownership guarantees that management and employees alike can cultivate their individual interests only by building up the organization as a whole. Such a community must rest on a sound economic basis, which makes competencies in finance, marketing, operations, etc., essential preconditions.
- Marketing is a means of building relationships for the common good by communicating products' real benefits. There is a risk, however, that marketing activities may simply serve to create more wants and desire to consume without promoting integral human development and without communicating anything that is true. Relationship marketing and integrated marketing communications have potential in promoting solidarity between the business and its stakeholders.
- New product development must serve the common good and incorporate true goods as features and not merely apparent goods. QFD can help in promoting better relationships among those involved in product design and overcome obstacles to quality or design problems.
I found a number of things helpful in conducting the course:
- The Code of Ethics for Business developed by the Bishops-Businessmen's Conference on Human Development gave a neat and easy to use set of guidelines for the students to concretize the intent of the course.
- Two additional students from a dissolved class transferred to my class, further enriching the range of discussions.
- The students were very thoughtful in their comments in class.
There were challenges too:
- The students' workloads often prevented them from doing the necessary reading preparations, whether on the textbook or the encyclicals.
- More structured activities should have been made available for the students, including cases for analysis, to internalize the principles.
The best part of the course for me was to witness how students would apply the principles in their discussions and thought processes at work. For example, a student who was in the thick of overseeing a company retrenchment was struggling with how to conduct this difficult process in a humane manner and in a way that can retain as much of the precious talent as possible. He said: "One big example here is the inclusion of drivers and messengers to the program. It is acceptable in achieving the objective of reduction but I think the consideration of retaining at least one driver at the same time he is the messenger. This idea of multi-tasking is still better than hiring a third party or an agencythat will handle those chores. "
Although I think the company will eventually outsource these services anyway, it makes me happy that at least one manager considered options other than this.
Another student, A, had shared her misgivings about her company's people practices at the start of the term. Through her persistent advisory inputs to the top management, she was happy to report that her superiors have began to consider her suggestions for more development activities for personnel. I have high hopes for this student.
I'll prepare a short two-session version of this course for integration in my business ethics courses. This will enhance how we currently cover ethics for our students.
Monday, September 19, 2005
Class is in session!
After a lot of work, and with a lot of help from colleagues at De La Salle Professional Schools (DLS-PSI) Graduate School of Business, notably from:
Nenette Barrios, chair of the human resource management department, who supported the elective's approval at the department level, and
Tristan Macapanpan, vice-dean of the Ortigas campus, who volunteered to host the elective class;
the Faith-based Management elective class is off the ground. Hurray!
The class meets every Tuesday, 6:00 p.m. to 9:15 p.m. at the Ortigas campus of DLS-PSI Graduate School of Business.
Of course, there were key suppliers who acted as unwitting and "silent partners" of this educational enterprise. There was Notre Dame University Press, publisher of Managing as if Faith Mattered by Alford and Naughton. Unfortunately, NDUP ran out of stock of the book and we had to resort to photcopying for this first batch. They assure us of a new printing, though.
There is the Vine and Branches bookstore at Sta. Lucia who was my only source of The Soul of the Firm by William Pollard. I called OMF which is the publisher of the book and they're also out of stock!
And of course, there's Claretian Publications, which publishes that wonderful little volume Catholic Social Teaching: Our Best Kept Secret by De Berri and Hug. The book makes it easy to get an overview of more than 100 years of Catholic social teaching in one afternoon. I love the summaries!
Of course, organizing this course would have been easier if the main book publishers publish such books also. Paging Pearson, Addison-Wesley, McGraw-Hill, Thomson, etc.!
I wrote a Managing for Society column on the occasion of the first day of class.
The first group of MBA students in the elective is a wonderful bunch and I'm sure I'll have a great time knowing and learning from them as the term progresses. They're all interested in how faith can lead them to become better managers and/or to be closer to their calling. E, for example, is a hospital and school owner and manager who wants the institutions she manages to be of better service to society. C is a bank branch manager who wants to better understand how to help those whom she supervises to integrate their spiritual life with their work life in the bank. I'm inspired by such commitments. I would be privileged to work under such managers. In fact, I have requested E if we can have one class session in her school or hospital.
As an unexpected but welcome bonus, we have P, a French exchange student, enrolling in the class. It's an interesting coincidence that on this maiden offering of the class, we have a French woman present, when it was the French priest John Baptiste de La Salle who made the original commitment to form the Brothers of the Christian Schools to address the needs of the poor through education! St. La Salle is now the Patron Saint of Catholic Teachers.
Another interesting French connection: I found out while doing the research for this class that the French entrepreneur-industrialist Leon Harmel was a pioneer (1870 to 1914) in promoting Christian industrial models. Let me quote from the book about him: "Harmel’s model factory at Val-des-Bois demonstrated that mutual accord and respect were possible between labor and management. Harmel turned his profitable spinning mill into a Christian corporation. His ethical business practices captured the attention of Pope Leo XIII and inspired his encyclical "Rerum Novarum." Harmel also encouraged his workers to make pilgrimages to Rome. The collaboration of Pope Leo XIII and Léon Harmel laid the foundation of enterprises that collectively became known as the movement of Christian democracy." Vive la France!
For those who still doubt that Christian social tradition applies to the "real world" of business, it's noteworthy that it was a practicing businessman like Harmel who inspired Pope Leo XIII to address the plight of workers in Rerum Novarum, thus, starting a string of papal writings on social justice culminating with Centessimus Annus. The teachings ARE based on reality!
I'm getting a lot of help in the class, through her encouraging presence and eager participation, from my colleague Mabel Gaite, who is the coordinator of DLS-PSI's Center for Social Responsibility and Human Development and also the Campus Minister. Mabel has been an unwitting collegial guardian angel (and expert resource on faith-related teachings) in my effort to integrate my faith into my work as a management educator. Thank you, Mabel!
So the class journey begins.
Nenette Barrios, chair of the human resource management department, who supported the elective's approval at the department level, and
Tristan Macapanpan, vice-dean of the Ortigas campus, who volunteered to host the elective class;
the Faith-based Management elective class is off the ground. Hurray!
The class meets every Tuesday, 6:00 p.m. to 9:15 p.m. at the Ortigas campus of DLS-PSI Graduate School of Business.
Of course, there were key suppliers who acted as unwitting and "silent partners" of this educational enterprise. There was Notre Dame University Press, publisher of Managing as if Faith Mattered by Alford and Naughton. Unfortunately, NDUP ran out of stock of the book and we had to resort to photcopying for this first batch. They assure us of a new printing, though.
There is the Vine and Branches bookstore at Sta. Lucia who was my only source of The Soul of the Firm by William Pollard. I called OMF which is the publisher of the book and they're also out of stock!
And of course, there's Claretian Publications, which publishes that wonderful little volume Catholic Social Teaching: Our Best Kept Secret by De Berri and Hug. The book makes it easy to get an overview of more than 100 years of Catholic social teaching in one afternoon. I love the summaries!
Of course, organizing this course would have been easier if the main book publishers publish such books also. Paging Pearson, Addison-Wesley, McGraw-Hill, Thomson, etc.!
I wrote a Managing for Society column on the occasion of the first day of class.
The first group of MBA students in the elective is a wonderful bunch and I'm sure I'll have a great time knowing and learning from them as the term progresses. They're all interested in how faith can lead them to become better managers and/or to be closer to their calling. E, for example, is a hospital and school owner and manager who wants the institutions she manages to be of better service to society. C is a bank branch manager who wants to better understand how to help those whom she supervises to integrate their spiritual life with their work life in the bank. I'm inspired by such commitments. I would be privileged to work under such managers. In fact, I have requested E if we can have one class session in her school or hospital.
As an unexpected but welcome bonus, we have P, a French exchange student, enrolling in the class. It's an interesting coincidence that on this maiden offering of the class, we have a French woman present, when it was the French priest John Baptiste de La Salle who made the original commitment to form the Brothers of the Christian Schools to address the needs of the poor through education! St. La Salle is now the Patron Saint of Catholic Teachers.
Another interesting French connection: I found out while doing the research for this class that the French entrepreneur-industrialist Leon Harmel was a pioneer (1870 to 1914) in promoting Christian industrial models. Let me quote from the book about him: "Harmel’s model factory at Val-des-Bois demonstrated that mutual accord and respect were possible between labor and management. Harmel turned his profitable spinning mill into a Christian corporation. His ethical business practices captured the attention of Pope Leo XIII and inspired his encyclical "Rerum Novarum." Harmel also encouraged his workers to make pilgrimages to Rome. The collaboration of Pope Leo XIII and Léon Harmel laid the foundation of enterprises that collectively became known as the movement of Christian democracy." Vive la France!
For those who still doubt that Christian social tradition applies to the "real world" of business, it's noteworthy that it was a practicing businessman like Harmel who inspired Pope Leo XIII to address the plight of workers in Rerum Novarum, thus, starting a string of papal writings on social justice culminating with Centessimus Annus. The teachings ARE based on reality!
I'm getting a lot of help in the class, through her encouraging presence and eager participation, from my colleague Mabel Gaite, who is the coordinator of DLS-PSI's Center for Social Responsibility and Human Development and also the Campus Minister. Mabel has been an unwitting collegial guardian angel (and expert resource on faith-related teachings) in my effort to integrate my faith into my work as a management educator. Thank you, Mabel!
So the class journey begins.
Saturday, July 23, 2005
Faith-based management
It's official. I will be teaching an elective course for MBA students entitled "Faith-based Management" during the 2nd trimester of SY 2005-06. The core material will be Alford and Naughton's "Managing as if Faith Mattered." The book's title is an interesting play on Schumacher's "Economics as if People Mattered" and it's just as intriguing and enlightening.
The core premise of the course is that Christian managers must live and manage with integrity, i.e., integrate their work and their faith. This leads to interesting questions: What kind of person should a faith-filled manager be like? How should he manage the people under him? What kinds of products/services should he offer? How should he design work? And so on.
Being an elective course, it remains to be seen if students will even enroll. But it would be interesting so see how MBA students, steeped in the corporate world, will respond to the possibility of deepening their faith through their own corporate work.
One my most interesting learning in designing the course is about Reell Precision Manufacturing (RPM). This company was created by its founders (former 3M employees) on Christian principles and in so doing not only started a viable and profitable company but also showed how Christian principles can actually be applied in the hyper-practical world of modern day manufacturing.
"Reell" is a German word which means "honest, trustworthy and good". The company's espoused beliefs reflect its Christian roots which put human dignity front and center. Not surprisingly, the company won the American Business Ethics Award in 2002. Co-founder Bob Wahlstedt shares here his reflections after 30-years of leading Reell. I'm struck by the creativity Reell's management displayed during crucial moments in its history when its commitments were tested. Such creativity gave birth to management practices that deserves emulation by other companies such as teach-equip-trust and target wages.
As part of the course, the class will be researching on Philippine companies which are managed along faith principles. That should be exciting and be worth writing a book about.
The core premise of the course is that Christian managers must live and manage with integrity, i.e., integrate their work and their faith. This leads to interesting questions: What kind of person should a faith-filled manager be like? How should he manage the people under him? What kinds of products/services should he offer? How should he design work? And so on.
Being an elective course, it remains to be seen if students will even enroll. But it would be interesting so see how MBA students, steeped in the corporate world, will respond to the possibility of deepening their faith through their own corporate work.
One my most interesting learning in designing the course is about Reell Precision Manufacturing (RPM). This company was created by its founders (former 3M employees) on Christian principles and in so doing not only started a viable and profitable company but also showed how Christian principles can actually be applied in the hyper-practical world of modern day manufacturing.
"Reell" is a German word which means "honest, trustworthy and good". The company's espoused beliefs reflect its Christian roots which put human dignity front and center. Not surprisingly, the company won the American Business Ethics Award in 2002. Co-founder Bob Wahlstedt shares here his reflections after 30-years of leading Reell. I'm struck by the creativity Reell's management displayed during crucial moments in its history when its commitments were tested. Such creativity gave birth to management practices that deserves emulation by other companies such as teach-equip-trust and target wages.
As part of the course, the class will be researching on Philippine companies which are managed along faith principles. That should be exciting and be worth writing a book about.
Saturday, May 07, 2005
The search for humanistic managers
Managers come in all shapes and sizes. There are the "dictator" types, "gentle" types, "bitaw" or micro-manager types. I'm really interested in the humanistic types. These are bosses who bring out the best in people by giving them respect and treating them as partners in the enterprise.
I wrote a couple of columns for Manila Times on this theme:
Employers and labor can think like partners
Business and people development
I'm now in the process of searching for humanistic Filipino managers who are able to balance people development and financial results as well as Herb Kelleher of Southwest Airlines, Horst Schulze of The Ritz-Carlton Hotel and William Pollard of ServiceMaster. I have some leads and I'll report here what I find out out. I'll be happy to get leads from readers.
I wrote a couple of columns for Manila Times on this theme:
Employers and labor can think like partners
Business and people development
I'm now in the process of searching for humanistic Filipino managers who are able to balance people development and financial results as well as Herb Kelleher of Southwest Airlines, Horst Schulze of The Ritz-Carlton Hotel and William Pollard of ServiceMaster. I have some leads and I'll report here what I find out out. I'll be happy to get leads from readers.
Wednesday, April 27, 2005
Human capital and globalization
I joined a research forum this afternoon on human capital issues in relation to globalization. It was a very informative exchange of views on how Philippine businesses, most of them family-based, are approaching people development to remain competitive.
As it turns out, investments in people development remains very low in our country. Which is a shame since we are blessed with so much human resource and it's only logical that they be developed for us to be competitive.
What we are seeing is the opposite -- more violations of the minimum wage laws, more contractualization and more use of women who tend to be more accepting of unfair labor arrangements (as hypothesized by one of the researchers).
I certainly hope that more business financiers and managers can adopt more people partnership approaches in their enterprises so that they can unleash the creativity and commitment so essential today for competitiveness.
As it turns out, investments in people development remains very low in our country. Which is a shame since we are blessed with so much human resource and it's only logical that they be developed for us to be competitive.
What we are seeing is the opposite -- more violations of the minimum wage laws, more contractualization and more use of women who tend to be more accepting of unfair labor arrangements (as hypothesized by one of the researchers).
I certainly hope that more business financiers and managers can adopt more people partnership approaches in their enterprises so that they can unleash the creativity and commitment so essential today for competitiveness.
Friday, April 22, 2005
Starting up
I've decided to start blogging to share my thinking on how management can be a force for the common good. It's also a way to explore this blogging phenomenon which many are saying is an information revolution of sorts. Only time will tell.
As to managing for the common good, management schools mainly focus on achieving private good. As a management educator, I've always been worried about this.
This is nothing new, of course. Management writers from Russell Ackoff to Henry Mintzberg have complained about the lack of social concern reflected in much of management education. More recently, David Korten and Joel Bakan have made more pointed comments about the damaging nature of business corporations. Although radical, their message needs to be studied carefully, if only to find antidotes to some of the valid problems they point to -- such as the tendency for many corporations to abuse the environment and to ignore workers' rights.
I've shared some of my thinking on managing for society in a Manila Times column of the same title which comes out every Tuesday. See for example:
What is business for?
Number games
Stocks and shareholder voice
Pope John Paul II: A great management thinker
Pope John Paul II: A great management thinker–Part II
Nowadays, I'm developing a course on Catholic Social Teaching and Management which I may be able to run in September. I'm developing the course in memory of Pope John Paul II whose writings, especially Centesimus Annus, have had a great deal of influence on my thinking about the role of business and the manager in society. I hope to write here about my experience in developing and running this course.
I'd like to get comments from people who are also thinking about the positive role that management can play in society.
As to managing for the common good, management schools mainly focus on achieving private good. As a management educator, I've always been worried about this.
This is nothing new, of course. Management writers from Russell Ackoff to Henry Mintzberg have complained about the lack of social concern reflected in much of management education. More recently, David Korten and Joel Bakan have made more pointed comments about the damaging nature of business corporations. Although radical, their message needs to be studied carefully, if only to find antidotes to some of the valid problems they point to -- such as the tendency for many corporations to abuse the environment and to ignore workers' rights.
I've shared some of my thinking on managing for society in a Manila Times column of the same title which comes out every Tuesday. See for example:
What is business for?
Number games
Stocks and shareholder voice
Pope John Paul II: A great management thinker
Pope John Paul II: A great management thinker–Part II
Nowadays, I'm developing a course on Catholic Social Teaching and Management which I may be able to run in September. I'm developing the course in memory of Pope John Paul II whose writings, especially Centesimus Annus, have had a great deal of influence on my thinking about the role of business and the manager in society. I hope to write here about my experience in developing and running this course.
I'd like to get comments from people who are also thinking about the positive role that management can play in society.
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