Compassion as the New Philosophy of Business

• Published in: Journal of relationship marketing (Binghamton, N.Y.) Vol. 10; no. 1; pp. 1 - 6
• Main Author: Bejou, David
• Format: Journal Article
• Language: English
• Published: Binghamton Taylor & Francis Group 01.01.2011; Taylor & Francis LLC
• Subjects: Business ethics; compassion; compassionate companies; corporate social responsibility (CSR); family and community development; freedom; Global economy; global social ills; human rights; Milton Friedman; philosophy of business; Profits; Recessions; responsibility to humanity; Social responsibility; Stockholders; Studies
• ISSN: 1533-2667; 1533-2675
• DOI: 10.1080/15332667.2011.550098

Forty years ago, Milton Friedman (1970) argued that the sole social responsibility of a company is to generate profit for its shareholders. The core message was that the primary responsibility of those running a business was to the owners or investors of the company. At the same time, Friedman assumed that the company would abide by laws and prevailing ethical customs. Unfortunately, Friedman's arguments have been misinterpreted by business managers and have provided justifications for engaging in any and all types of immoral, unethical, and illegal activities for personal gain and corporate greed. Such activities have also contributed to the recent global recession, which has had a profound negative impact on the lives of millions of people worldwide. Given various instances of corporations' abnegation of their responsibility for the impacts of their actions, it is clear that the sole purpose of a business is not merely that of generating profits for its owners. Instead, because compassion provides the necessary equilibrium between a company's purpose and the needs of its communities, it should be the new philosophy of business. Emerging from the same paradigm as corporate social responsibility (CSR), compassion is the guiding precept that a company's positive impact on its community is primary to its generation of profits for its shareholders.