Businesses that take wholistic view are thriving
By Mike Strathdee
As printed in The Marketplace - January/February 2018
Businesses that want to grow lasting profits will embrace “triple bottom line” thinking that seeks to maximize purpose as well as dollars, a Pennsylvania business professor says.
“At the end of the day, because of how God has created and designed business to work, you are actually going to maximize profit if you pay attention to your customers, to your suppliers, to your employees,” JoAnn Flett said in a workshop address at MEDA’s annual convention in Vancouver.
Flett directs the Master’s of Business Administration program at Eastern University, a Christian university near Philadelphia, Pa. that is affiliated with the American Baptist Churches USA. She is board chair of Capital for Good USA, a philanthropic organization that works to help vulnerable and marginalized people in the USA and around the world.
Flett and Tina Campbell, who is interim co-executive director of the ASSETS program in Lancaster, Pa., outlined the case for using Christian business as a force for good.
There is a theological basis for businesses creating economic and social value, Flett said.
One of the challenges in making this more widely understood is overcoming the “sacred-secular divide,” the misinformed feeling in the church that business is deeply secular.
When Flett suggested that the Philadelphia Chamber of Commerce should host a seminar on doing well by doing good, she was told “no one will come to that.”
She persisted, and the session attracted 153 small business owners, spawning a five-year series.
Business is about money and meaning simultaneously, she said. In her Faith and Fortune business ethics course, she reminds students that the purpose of business is not just to generate profits, but to better the lives of people it touches and to serve the common good. While profits are essential, they are merely fuel to sustain the business.
JC Penney, writing in 1919, understood that his retail firm owed a profit to the public, to provide good-paying jobs and to restore the community. Similarly, Henry Ford paid a living wage, giving his workers enough money that they could buy the cars his firm produced.
Business has an intrinsic role in Christian identity, by providing meaningful work, she said. Given that business is inherently relational, “you have to care about your community, your employees, your suppliers, your customers. Any of those fall down and you are in trouble.”
The original meaning of the term economics includes care of others, purpose and service, she noted.
ASSETS is working to harness the power of the private sector to reclaim that broader purpose.
MEDA started the ASSETS (ASSETS stands for A Service for Self-Employment Training and Support) program in 1993. At one point, it grew to 25 cities across North America. Most were in the US, as well as a chapter in Mexico City and Canadian projects in Kitchener-Waterloo, Ont. and Vancouver, B.C.
MEDA spun out the program to local partners a few years later after the board decided that domestic community economic development, for which institutional funding was difficult to find, was not a core priority. Today, two ASSETS projects remain, in Lancaster, Pa. and Toledo, Ohio.
Tina Campbell urged the audience to consider practical ways of carrying out “business as unusual.”
“Business as usual isn’t working in our society right now,” she said.
While North Americans live in the wealthiest society in the world, that wealth isn’t for everyone, she noted.
ASSETS has struggled to determine how to respond to the fact that poverty has doubled in Lancaster since ASSETS was established, largely due to a loss of manufacturing jobs. That is a challenge for an organization whose mission is poverty reduction.
Campbell urged people to think about how they use restaurant spending, including whether servers are being paid a living wage. “How many of us are thinking intentionally about where we go, when we spend money in restaurants?”
She cited a 2014 study that estimated restaurant spending totals $800 billion, double the $400 billion donated to charitable causes.
One Lancaster restaurant, John J. Jeffries, chose to employ Burmese refugees and help them buy homes. Since starting that initiative, they have had zero employee turnover in their kitchen over the past four years.
Another firm, Lancaster Food Company, has intentionally built its business around creating jobs for people with barriers to employment. The firm, which bakes organic bread, offers a living wage to its employees, most of who come out of the prison system.
For the past four years, ASSETS has sponsored the Great Social Enterprise Pitch, a five-month competition that helps participants create business plans that incorporate social and economic values. This year’s winner was a Somali refugee who created Bridge, an online portal that Campbell described as “a cultural Airbnb.”
Bridge offers services such as cooking lessons, dance classes or drumming lessons. Buyers pay for services and provide an income for newcomers.
ASSETS produces a business directory to help companies find suppliers that fit specific criteria, such as women-led social enterprises. Consumer decisions matter as well, Campbell said, urging people to buy their food from locally owned grocery stores and to use a similar lens when purchasing gifts.
Lancaster County, Pa. is a 600,000-person market. If 10 per cent of consumer spending shifted to local businesses from national chains, the resulting $130 million in purchases would create 1,600 new jobs in the area, with $52 million in new local wages, Campbell said.
Given that the creation of 3,000 good-paying jobs would cut the poverty rate in Lancaster County by half, even a 10 per cent shift in consumer spending to local firms could have a dramatic impact, she said.
That prescription didn’t sit well with everyone in attendance. One participant noted this spending would just be pulled from somewhere else, warning about the dangers of protectionism.
Places that pull everything back home will ultimately lose more than those that are trading, he said.
Flett, agreeing that the issues are complex, urged the audience to challenge their church leaders to think more strategically about business. ◆