BUSINESSES MUST CONNECT more with society if they want to regain public trust after the financial crisis, corporate scandals and tax avoidance have eroded the public’s view of companies, according to a new report due out.
It is no longer acceptable to say business is simply about generating profits for shareholders, a new study by the Institute of Business Ethics has revealed. Business needs to show how it contributes to social well-being wherever it operates, the IBE said.
The institute, which is celebrating its 30th anniversary, said a new approach to business leadership was needed that is based on consensus building, embedding values and connecting business to society.
“The age of deference is over. A succession of scandals has undermined trust, and business is too often seen as purely interested in profit. Leaders who see themselves as individual superstars will not be able to deal easily with this. We need to look for new models – leaders who are connected with their employees and society and use this talent to facilitate good and sustainable results,” said Philippa Foster Back, IBE director.
The IBE will presented its report – The Institute of Business Ethics: The next thirty years – last week, marking 30 years since the IBE was launched. The Lord Mayor, Alderman the Lord Mountevans and Standard Life chairman Sir Gerry Grimstone also spoke about the changing business ethics landscape and what the future might look like.
Peter Montagnon, IBE associate director and the report’s author, said: “This is not just a question of addressing specific problems like remuneration and taxation, important though these are, but of instilling the right mind-set throughout business organisations. The challenge for business leaders is to develop a culture which takes their organisation beyond mere compliance with regulation.”