An ethical revolution in business and banking is crucial to prevent the world lurching into greater economic crises, said panellists at the London launch of a new book, Great Company, by business journalist Michael Smith, on 27 October 2015. Paul Moore, the renowned HBOS whistleblower, international hotelier Lawrence Bloom and social entrepreneur Sophia Swire, who each feature in Smith’s book, were speaking alongside the author at the Initiatives of Change (IofC) centre in London. The event was chaired by Anita Hoffmann, Managing Director of Executiva, the executive search company (left).
Introducing his book, subtitled ‘Trust, integrity and leadership in the global economy’, Smith highlighted a ‘global shift in consciousness away from bottom-line thinking and acquisition, as the sole criteria, towards contribution to society’.
The inspiration for his book, Smith said, were the stories of courageous business people attending the annual conferences on Trust and Integrity in the Global Economy (TIGE) at the IoC international centre in Caux, Switzerland and similar business conferences in Panchgani, India. Smith said: ‘I was hugely stirred by their stories of great courage, in their stance for integrity and the values and virtues which build trust. I wanted to bring their stories together.’ He highlighted the series of global corporate scandals that began with the 2008 banking crisis and continue to this day with the VW emissions scandal.
Smith described two types of entrepreneur: ‘Those who are motivated solely by acquisition are the wreckers and destroyers. Those who are motived by contribution are the builders.’ The future belongs with those who step away from bottom-line thinking and acquisition towards valuing how business can contribute to the social good.
Smith's book focuses on what he identifies as five pillars of trust: Sustainability, Cooperation, Integrity, Purpose and Stewardship. These inform the book's approach to social entrepreneurship, banking, the stance against corruption, the environmental challenge and the role of business academia, each of which are covered in chapters of the book.
What is understood by ‘trust’, Smith posed. It included personal qualities of character, conscience and calling, which need to be nurtured, as well as contractual relations and the ‘covenant’ and ‘competence’ bases of trust, which needed to be inviolable.
He urged a re-reading of Adam Smith as a moral philosopher, not merely the man who spoke about the ‘invisible hand of the market’. Adam Smith, who is commonly regarded as the thinker behind free market economics, had ‘referred no less than 66 times to the “Impartial Spectator”, which acts like a “demigod within the breast”—in other words our conscience. That was at the very core of Adam Smith’s moral philosophy. And that is what subsequent generations so sadly overlooked. Yet, far from the ends justifying the means, the means actually determine the ends, as the banking crisis so painfully showed. The way we do things is as important as what we do.’
HBOS whistleblower Paul Moore, who was head of group regulatory risk at Halifax Bank of Scotland, praised Smith's book, saying it contained ‘great thoughts and content. It exposes wrongdoing but also celebrates right-doing.’ He added: ‘We are at the cusp of an old world and a new earth. We can either bring truth, justice and freedom to the world or it will explode. This is not a factual challenge; this is a political struggle between ordinary people and “corporatocracy”. We need to move from dog-eat-dog capitalism and create a new grassroots movement.’ Moore launches his own book, Crash, Bank, Wallop, in London on 6 November.
Lawrence Bloom, who championed environmental responsibility while serving on the executive board at InterContinental Hotels Group, warned that, 500 years since the Renaissance, humanity had come to ‘a place of great danger’. He added: ‘We have come to the end of the age of change and are at the beginning of the change of age. Environmental, social and financial problems are related to a clash of values between the old and the new. Fiduciary duty should mean more than the quarterly bottom line and shareholder values in the pursuit of the maximisation of profit.’
Sophia Swire, founder of the non-profit Future Brilliance and its Afghan social enterprise, Aayenda Jewellery, said that social entrepreneurship was a growing trend in the development space and, if delivered well, could provide the most sustainable model for development, boosting local business and reducing dependency on foreign aid. In the meantime, the US needs to stop cutting its aid budget and footprint in Afghanistan, for both humanitarian and security purposes. Swire has been working with the Afghan Ministry of Mines, funded by the World Bank, to formalise and develop its gemstone industry and create sustainable jobs for thousands of Afghan men and women. She concluded that another human attribute which builds trust is kindness.
Daniel Brett
'Great Company: trust, integrity and leadership in the global economy' by Michael Smith, Initiatives of Change, 176 pages, ISBN 978-1-85239-047-1
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