How is the Modern Corporation Responsible?

The Center for Ethical Business Cultures launches a new book that examines the journey of American business in corporate responsibility, tracing ideas across nearly two centuries.

In 1977, Twin Cities’ business leaders from 48 organizations began meeting at the Spring Hill retreat center in Wayzata, Minn., to explore the role of business in addressing societal issues. The CEOs repre-sented companies that formed the A-list of the "who’s who" in Minnesota. At the heart of the debates was a fundamental question: What is the purpose of business … to whom and for what purpose does business exist? Now, 35 years later, the book Corporate Responsibility: The American Experience will answer the question set by the center's founders: To whom, for what purpose and how is the modern corporation responsible?

The Birth of a Center

Between November 1977 and March 1978, those business leaders convened for daylong retreats tackling major questions facing the community and defining business’ responsibility. Out of the process emerged the Minnesota Project on Corporate Responsibility (MPCR), the forerunner to what is now the Center for Ethical Business Cultures (CEBC).

As the MPCR, its principal role was that of convening busi-ness leaders to address complex issues such as diversity, corporate responsibility, corporate philanthropy and education. Throughout the 1980s, it facilitated the discussions as business leaders defined the nature of the problem, identified solutions and developed business’ responsibilities.

In the late 1980s, having been renamed the Minnesota Center for Corporate Responsibility (MCCR), the center developed principles to guide business behavior as it engaged with its stakeholders. These became known as the Minnesota Principles, with the MCCR assuming the role of an evangelist of sorts, spreading the principles.

The principles moved from Minnesota to a global stage in the early 1990s as the Caux Roundtable – an international col-laboration of business leaders from Asia, the Americas and Europe – came to Minnesota seeking to identify tenets to guide business behavior as it conducted its affairs around the globe. The group adapted the principles to reflect global themes and adopted them as the Caux Roundtable Principles for Business.  They have been published in 12 languages.

As businesses’ needs changed, over the last decade the CEBC emerged into a role of practitioner, assisting business leaders in building and sustaining ethical cultures. In this capacity, the cen-ter provides practical advice and counsel, and ethical leadership development services.

The center is now making progress toward its most ambitious undertaking: building a national thought-leadership position in the field of business ethics.

Corporate Responsibility: The American Experience

Today, CEBC is firmly embedded in the Opus College of Business. The center plays a unique role serving at the intersection of thought and practice leadership. It is taking its decades of expe-rience and wealth of knowledge gained in serving the business community and coupling those with the historical commitment and growing investments in academic excellence and business eth-ics by the Opus College of Business.

One tangible outcome of this effort is the book Corporate Responsibility: The American Experience. It is a project that arose from a major gift of $1.9 million to the University of St. Thomas by Harry Halloran Jr., a Philadelphia entrepreneur and chair and CEO of the American Refining Group (ARG). David Rodbourne, vice president of the center, served as project director and Dr. Kenneth Goodpaster, Koch Endowed Chair in Business Ethics at the college, served as the executive editor.

The book truly is, in all senses of the word, landmark. Never before has one publication taken such a detailed look at the evolu-tion of "business ethics," encompassing not just ethical behavior but also management theory and practice, and tied them to his-torical developments in business and industry in such a compre-hensive manner.

Goodpaster and Rodbourne convened a group of leading academic scholars and business practitioners to begin to shape the project. Five leading scholars were chosen to research and write American history, including Goodpaster, as well as management, history and ethics professors from the University of Georgia, Florida International University, Boston University and DePaul University.

The book examines the journey of American business in corporate responsibility, tracing ideas and practices across nearly two centuries. It is a story with many threads: visionaries, rogues, social reformers, labor leaders, political activists (radicals and moderates) and a productive, innovative economy.

As Ken Powell, chairman and CEO of General Mills, notes in the book’s foreword:

"This book appears at a timely moment. Many business leaders are clearly rethinking what it means to be a truly socially responsible company, and this important work helps us under-stand not only the history of corporate responsibility, but also its evolving future."

The official launch of the book occurred with an afternoon kickoff event on Sept. 7, and will be further touted at a spring 2013 academic conference, which will attract papers and reflections from top thought-leaders in the field. A second book examining the global history of corporate responsibility is already on the drawing board.

The Next Step

As a result of notable scandals in the last decade, the public is looking to government for greater protection and regulation of business behavior. According to one survey, the public most wants corporations to follow ethical business practices, to listen to customer needs and feedback, and to put customers before profits.

Given this clearly expressed public need, the CEBC board of directors – led by its past chair, former board member and retired chair and CEO of Toro Corp., Ken Melrose; its current chair and deputy general counsel of General Mills, Linda Sorrano; and Opus College of Business dean Christopher Puto – began to seek a new role for the center. In their vision, this new role would impact both today’s and tomorrow’s leaders as they shaped, developed and acted upon their own ethical cores.

Corporate Responsibility: The American Experience is only one of many visible steps the center is taking to make that vision a reality. This new course will allow the center to become a place where thought leadership intersects with practical leadership in business ethics. More explicitly, our vision is to make the CEBC a conduit that ensures a free flow of intellectual capital between the academic and business communities, a reservoir where thought and practice leadership reside, and a catalyst to stimulate dialogue that fosters the development of an ethical culture.

Read more from B. Magazine.

More from B Magazine