Perspectives, a blog of ideas from The Johns Hopkins University

Reinventing the social charter of U.S. business

Posted on 19. Jan, 2009 by Tracey Reeves in Uncategorized

In the face of a struggling economy, high unemployment and uncertainty about the future, Lindsay Thompson, Phd., professor at the Johns Hopkins Carey Business School, specializing in business ethics, suggests the new administration examine the emerging role of business in a changed world order as it works to strengthen the global economic scene.

Generations of Americans have counted on the traditional social contract as the foundation of peace and prosperity – a foundation now threatened by global forces that cannot be effectively controlled by even the most powerful nation in history. Millions of people who have looked to the wealth-generating power of business and free markets as a platform for human flourishing have instead found devastating risk, threat, and uncertainty. The implications for American business are profound and far-reaching. The current crisis provides an opportunity, then, for President-elect Barack Obama to engage diverse stakeholders in a critical re-imagination of American business as a sustainable foundation for a peaceful, prosperous global society.

Here is where Johns Hopkins University could play an important role. With the launch of the Carey Business School to promote “business with humanity in mind,” the university adds another field of study to a portfolio of intellectual talent, policy expertise, and professional education programs uniquely positioned to amplify the knowledge of the Obama administration.  This is an opportunity for the university to step up in a concerted way, drawing on intellectual talent not just from its new business school but from all its diverse divisions to create a sort of unofficial think tank at Johns Hopkins on the future of business and the social contract.

The promise of business as a platform for human flourishing is not without risks. The current financial crisis is a grim reminder that business does not provide for human needs in times of austerity; the state remains responsible for ensuring social security and stability when markets fail and jobs disappear. While the modern corporation has proved to be the uncontested engine of wealth creation in the global economic order of free market capitalism, questions remain about the limits of its current form within a market that in the future will demand responsiveness and adaptability.

Seeking relief from the barrage of costly, contradictory legal and ethical constraints they encounter while doing business internationally, some companies regard government as the enemy and seek to relocate, go private, or lobby for deregulation. As the legal environment of business globalizes, however, it will not necessarily provide a platform of robust opportunity for people up and down the economic scale. Business has a long way to go in becoming a reliable means of vertical economic integration across the globe.

In light of these conditions, Johns Hopkins University has the potential to engage scholars and leaders from diverse disciplines and sectors to collaborate in a critical exploration of the emerging role of business in a radically transforming world order. With campuses stretching from Baltimore to Washington, Johns Hopkins is the most readily accessible knowledge enterprise in the capital region. The Obama Administration would do well to make use of it in any reconsideration of business’s role in society.