Issue link: http://www.e-digitaleditions.com/i/57462
Your Turn The Responsibility Gap I traveled to Beijing last fall to speak to 400 members of The Drucker Society, all moguls among China's most successful capitalist elite. To my surprise, they did not ask me to talk about the latest in global supply chain management, marketing, or business strategy. They wanted me to explore ways that they could stimu- late global social entrepreneurship. As their country's economy experiences double-digit growth, these business leaders are terrified of what will hap- pen to China if its growth continues with no central system of checks-and- balances—and worse, with no moral compass. At one time, we wouldn't even have had to fear such a scenario. In the 1950s and '60s, business's responsibility to society was assumed, and general management curricula included much information about business and its role in society. At the time, Peter Drucker became the first to identify the importance of the social sector, the first to call for the reinvention of government. He championed the balanced scorecard, the knowledge-based economy, and the view of employees as assets rather than liabilities. He argued that the practice of management was about channeling its power into assuring society's prosperity—and through that process, assuring its own. Then, scholars such as Milton Friedman challenged the notion that social responsibility was a business matter. Responsible business practices were discarded and considered an indulgence—they became throw- backs to a bygone era. They became less and less featured in the business 62 BizEd JULY/AUGUST 2008 by Ira Jackson curriculum. Somehow, business and business schools lost that vital con- nection to the communities they served. Explosion of Interest Even so, what Peter Drucker championed in the 1950s is more important than ever to 21st-century businesses. We now have wholly new concepts such as triple bottom line, environmental stewardship, social entrepreneurship, and carbon footprint. Three billion people in formerly totalitarian societies have entered market-based economies over the last 20 years. Amid that transition, an explosion of academic theory is focusing on the value of treating communities—as well as NGOs, vendors, customers, and employees—with respect. In addition, our 24/7 culture, where online media like CNN and YouTube are on constant watch, gives business nowhere to hide. Social responsibility is not a periph- eral indulgence that's just for com- panies like Ben & Jerry's. Businesses either commit to responsible business practices or expose themselves to negative scrutiny and damage to their reputations—not to mention miss the new business opportunities created by socially driven innovation. But why are business schools so far behind this new reality of the market? The academy has tradition- ally been reactive and responsive, rather than proactive and pioneering. As a community, business schools need to catch up—we need to close the responsibility gap. Some business educators already are doing wonderful work in this area: David Cooperrider at Case Western, Rosabeth Moss Kanter at Harvard Business School, and Sandra Waddock at Boston College are all part of a cadre of scholars who are thinking creatively and vigorously about the role of business in society and creating new definitions of busi- ness leadership. Even so, the prevailing view has not been that the mission of business schools is to change the world for the better. However, with business placing new emphasis on CSR, that view is changing. It is the mission of business schools to provide society with the ethical leaders it demands and recognize that the path to value creation and new markets is through values-driven, responsibility-based management. Building on Drucker Each fall, when I speak to our incom- ing students at the Peter F. Drucker and Masatoshi Ito Graduate School of Management at Claremont Graduate University in California, I ask them, "What do you want to be remem- bered for? What will be your signa- ture, your imprint, the purpose of your personal and professional enter- prise?" Whether they lead a product line, a division, a company, an NGO, or a country, I believe they must keep their values in mind and represent those values in ways that make society better, and in ways that leave their institutions stronger as a result of their responsible stewardship. At our school, we're extending Drucker's work into new areas and refreshing it with a 21st-century perspective. For example, our new gateway course, "The Drucker Dif- ference," taught by our entire facul- ty, introduces students to Drucker's work, including the inevitable con- nection he saw between building a profitable business and building a healthy society.