The CEO President

By Dan Kärreman.

President Trump is going to be different. So far most of the commentary has been focused on him as a trailblazer for white nationalism and populism, and for his unique personal qualities. This is understandable, since the marriage between white nationalism and populism was dissolved in 1964 in the USA when the Democratic party finally took a long hard look on its racist past and decided to become the party of civil rights, thus fracturing the mix of white supremacy and New Deal policies that had ruled the South since the implementation of the New Deal. And as for president Trumps personal qualities… let’s say that we can expect unorthodox and colorful commentary on that front for the next four years.

Can Trump’s business habitus compensate for a lack of experience in government & politics?

One aspect of Trump that has been overlooked is that he has no previous experience of government and politics. To the extent it has been an issue, Trump has largely managed to make this a point that has worked to his advantage as it has given him credibility in claiming that he is not part of the (corrupt) establishment. His celebrity has also compensated for the lack of name recognition that normally would hamstring the outsider candidate. But his lack of experience of government and politics is likely to have a profound effect on how he will operate as a president.

On the other hand, Trump has considerable experience of being a business president. He has worked a business executive for more than 35 years. In Bourdieuan terms, this is his habitus. Being a business executive is different (but not completely different) from being a politician. It is worthwhile to have a closer look on what we can expect from a business executive.

Authoritarian, KPI-driven and delegating responsibility

First, executives run on hierarchy. As an executive, it is a given that you have say-so in your domain. Operationally, this is perhaps not different from politicians who also mostly work in hierarchical arrangements. However, as a politician in a liberal democracy you must internalize the idea that you represent a constituency and at least pay lip service to the fact that power comes from the people. Not so for an executive, where power comes from the guy above you in the hierarchy. Fact is that executives are not only comfortable in authoritarian set-ups, they thrive on it. The authoritarian aspect of Trump’s persona is perhaps the most grating one for the political class, where such tendencies are expected to be suppressed. They are unlikely to be troubling for most of the electorate though, since most people interact more frequently and more comfortably with executives than with politicians in everyday life.

Second, executives are driven by a narrow set of key performance indicators. The indicators can be played to some extent but they are also real in the sense that they operate as grading mechanisms for performance. Expect Trump to identify a narrow set of deliverables that he will insist to be evaluated upon. The most likely candidates are immigration (or rather deportation), trade, nominating socially conservative judges for the supreme court and infrastructure spending. Having said that, Trump is probably open for negotiation on this point. He does not appear to be particularly ideological (apparently, he has changed his party affiliation 5 times the last 15 years) but he would insist to have indicators that makes it possible to claim success. Success is very important for executives.

Third, executives delegate. This goes beyond the idea of the fact that it is impossible to be experts on everything. Executives are strong believers in the division of labor, in fact the whole idea of an executive is built on division of labor, and are comfortable in pushing out responsibility to subordinates. Delegation offers possibility for subordinates to prove themselves and to further their careers, thus creating bonds of loyalty between executives and subordinates. Politicians delegate too, but the career aspect of delegation is less pronounced. Politicians delegate to increase representativeness and to invite expert commentary. Put bluntly, executives delegate for reasons of expediency while politicians delegate for reasons of deliberation.

A Business presidency

Overall, we can expect a presidency that will work more like a business presidency than the typical political presidency. The authoritarian aspects of the business president are likely to be an ongoing source of frustration, since the US presidency in actual reality is a weak office with a lot of checks and balances (foreign policy is an exception but Trump does not seem very interested in this area). The importance of projecting success is likely to make the Trump presidency prone to unpredictable policy shifts. Finally, the promotion of expediency will open for a lot of semi-scandals and crypto-grafting since it promotes a potent but problematic mix of loyalty, initiative and patronage, qualities that sits uneasily with the ethos of public government.


Dan Kärreman is Professor in Organization and Management Studies at the Department of Intercultural Communication and Management at Copenhagen Business School. He is on Twitter.

Pic by Steve Baker, Flickr

UN Global Compact Silently Expels More than 2,300 Non-Business Participants

By Andreas Rasche.

The UN Global Compact continues to “clean up” its participant base. The initiative reported to have 5,332 non-business participants (e.g., global and local NGOs and associations) in its October Bulletin, while its November Bulletin lists 2,983 active non-business participants. Hence, the Compact seems to have expelled more than 2,300 non-business participants for failure to submit the required “Communication on Engagement” report in the beginning of November. This is almost 43% of all non-business participants.

Non-Business Participants Delisted After Three Years

According to the Compact’s own “Communication on Engagement” policy, all non-business participants must submit a report every two years. The policy came into effect 31 October 2013. If participants do not submit such a report, they are labeled as “non-communicating” participants for another year. In other words, non-business participants that fail to submit a report are delisted after three years.

The Compact understands itself as a business-driven initiative, which, however, has clear links to NGOs, associations and also labor organizations. Non-business participants are vital actors, especially when considering the role of partnerships (SDG 17) and the general need for collaboration between business and society. Expelling more than 2,300 participants significantly undercuts the ability of the Compact to initiate and sustain such partnerships on a broader level.

Delisting as an Opportunity and a Problem

The delisting of non-communicating NGOs is a welcome move. It shows that the Compact takes its own integrity measures seriously and hence strengthens the accountability of the initiative. In the long run, the Compact will only thrive if businesses, NGOs, and, most of all, governments, trust it. And trust, as we all know, is not cheap; it must be earned over time.

However, this massive delisting also points to a significant problem: The Compact seems to rely too much on “growth by numbers.” Simply having over 5,300 non-business participants is useless, if 2,300 of them do not even dare to submit a rather basic report that outlines their activities in support of the initiative. I have said it before, and I will say it again: The Compact is too good of an idea to simply throw away. However, the value proposition of the initiative seems to remain opaque to most participants. The high number of delisted business participants (now reaching 7,500) and the impressive number of 2,300 delisted non-business participants (most of them being NGOs) question the “business model” that underlies the initiative. It may be time to rethink this model.

What Bothers Me Most is…

What bothers me most about all of this is: the Compact itself has not yet mentioned this massive delisting with a single word in its News section (as of 21 November 2016). Is such a massive loss of participants not a newsworthy event? We can read about all sorts of success stories in the News section, but the fact that the initiative expelled more than 2,300 non-business participants is not mentioned with a single word. The Compact itself promotes transparency (e.g. through Principle 10 on anti-corruption) and it should live up to its own ambitions by painting a fair and timely picture of the initiative. There is no reason to be ashamed of having to delist a high number of non-business participants, if the Compact learns the right lessons from this. No initiative is perfect and the Compact has come a long way. It has helped to mainstream corporate responsibility and sustainability, but it may also be in need of rethinking what value it creates for its participants…


Andreas Rasche is Professor at Copenhagen Business School and Director of CBS’s World Class Research Environment Governing Responsible Business. He has collaborated with the UN Global Compact on different projects and served on the initiative’s LEAD Steering Committee from 2012 to 2015. More information on: www.arasche.com

Pic by emilydickinsonridesabmx

Sustainable Business Model Research –Time to Leave the Twilight Zone

By Dr. Florian Lüdeke-Freund.

Research on sustainable business models, or “business models for sustainability (BMfS)”, is still a niche topic in both the business model and sustainability communities. BMfS researchers often find themselves in a twilight zone, not knowing whom to address with or involve in their research. After one decade of BMfS research, it is time to develop a joint agenda to strengthen and shape this interdisciplinary field.

Leaving the Twilight Zone

Looking at seminal articles, we see that early work on BMfS deals with organisational and cultural preconditions of business models that contribute to corporate sustainability. Analysing business models is also seen as a means to overcome the technology bias of traditional eco-innovation approaches and move towards system level innovation, e.g. through product-service systems. Others see business models as tools to re-scale and re-localise monolithic industrial infrastructures, while again others investigate the links between business models and business success through corporate sustainability. Research on BMfS is often rooted in ecological sustainability, but some scholars see BMfS also as a means to address social issues.

These perspectives and topics clearly show that we need multiple disciplines, theories and methods to properly study BMfS. But reviewing the BMfS literature, which we have done in different projects and articles (Boons & Lüdeke-Freund, 2013; Schaltegger et al., 2016; Lüdeke-Freund et al., 2016), shows that we, as BMfS researchers, tend to talk to our “sustainability peers” only, in terms of how we frame and work on research problems and the journals we publish in. At the same time we are sitting somewhere in between. We are neither pure management scholars nor ecological economics veterans. We are in a twilight zone.

After one decade of BMfS research, it is time to step back and reflect on the topics we have studied, the theories we have used and developed, and the methods we have applied. We should ask ourselves, who – from outside our community – could help with the problems we are studying? Obviously, this is a multi- and interdisciplinary effort. Therefore, a joint, multi- and interdisciplinary research agenda and mutual exchange are required.

Towards a Joint Research Agenda

Our recent Organization & Environment special issue on BMfS covers a broad range of entrepreneurial, managerial and innovation issues. However, a lot remains to be done with regard to theory development and management support. Here, the original business model and the diverse sustainability communities could and should work together, develop projects and write articles that contribute to theory development and management support and are acceptable to their various audiences – including their respective journals.

The following exemplary research problems were identified in the editorial article of our special issue and could serve as a starting point for a joint research agenda for the original and the sustainability-oriented business model communities:

Theory development

  • How can theories on the organisational level (e.g. dynamic capabilities), individual level (e.g. responsible leadership) or on both levels (e.g. organizational learning) help explain green and social business model transformations?
  • How do BMfS co-evolve and trigger industry transformations both via market interaction and system transitions (e.g. evolutionary economics)?
  • Which learning-action networks and collaborations, but also power struggles between stakeholder groups, are involved in the creation of BMfS (e.g. stakeholder theory)?

Management support

  • Which management frameworks and instruments enable the management of and transition to BMfS (e.g. change management)?
  • Which frameworks and instruments can support innovation (e.g. design thinking, The Natural Step) and strategy implementation (e.g. Business Model Canvas) for BMfS?
  • How can performance and societal impacts be measured and managed on the business model level (e.g. balanced scorecard)?

These are just a few exemplary topics. But it is a starting point. It is also, or even much more, an open invitation to scholars from fields such as entrepreneurship, innovation, design, policy, and transition research, and many more, to develop a joint agenda that allows for true multi- and interdisciplinary BMfS research.

Our dynamically growing communities – e.g. Business Model Community, Sustainable Business Model Blog, Strongly Sustainable Business Model Group, Sustainability Transitions Research Network, Inno4SD – could benefit from such an agenda to progress in a more synergistic way, combining the best of these worlds: up-to-date knowledge about business model and sustainability research.

Such an agenda would shed some light on the twilight zone of BMfS research and would help to establish it as a research field in its own right.

Let’s start the conversation – now.


Florian Lüdeke-Freund is a senior research associate at the University of Hamburg, Germany. He is a research fellow at the Centre for Sustainability Management (CSM), Leuphana University, and the Governing Responsible Business Research Environment at Copenhagen Business School, Denmark. His research deals with sustainable entrepreneurship, sustainable business models, and innovation. Florian founded www.SustainableBusinessModel.org as an international research hub addressing sustainability, business model, and innovation topics.

Pic by Rod Serling’s classic anthology, The Twilight Zone (1959 – 1961)

CSR as Power in Global Governance. The Anti-corruption policy of Danish Companies in China

On Tuesday 29 November 2016 Anestis Keremis will give his first WIP seminar with the title:

CSR as Power in Global Governance. The Anti-corruption policy of Danish Companies in China

When: Tuesday 29 November 2016 from 10:00 – 12:00

Where: Porcelænshaven 1, 1.04, 2000 Frederiksberg

Discussants:

Professor Hans Krause Hansen, Head of OMS, Department of Intercultural Communication and Management, CBS

Associate Professor Steen Valentin, Department of Management Politics, and Philosophy, CBS

Supervisors:

Associate Professor Antje Vetterlein, Department of Business and Politics, CBS

Professor Jeremy Moon, Department of Intercultural Communication and Management, CBS

If you would like a copy of the paper to be presented, please e-mail Anestis Keremis ( ake.dbp@cbs.dk ).


pic by baaghi

Sustainability Lecture Series invites: Dr. Bob Massie

Invitation: Join the Sustainability Lecture at Copenhagen University with Dr. Bob Massie on the topic “Divestment from fossil fuels and the implications for the Paris Agreement”

The Sustainability Science Centre of Copenhagen University is hosting a Sustainability Lecture series and invites you to attend the next sustainability lecture on 21 November 2016 by Dr. Bob Massie from the Sustainable Solutions lab, University of Massachusetts, Boston. He will talk on divestment from fossil fuels and the implications for the Paris Agreement. Katherine Richardson, Leader of the Sustainability Science Centre, will moderate the talk.

When: 21 November 2016, 15:00 – 16:00

Where: Aud – A1-01.01, (1-01 Festauditoriet, Bülowsvej 17, 2000 Frederiksberg

Read more here

Admission is free of charge, but please make sure to sign up for the event.

See you there!

Information on the event:

Bob Massie has been working on business, finance, governance, and sustainability for more than thirty years. Dr. Massie received his A.B. magna cum laude from Princeton University in 1978, a master’s degree in social and theological ethics from Yale Divinity School in 1982, and a doctorate in business policy and corporate strategy from Harvard Business School in 1989.

In 1993, as a senior Fulbright Scholar, he was visiting member of the faculty of the University of Cape Town’s Graduate School of Business. His definitive history of the U.S. anti-apartheid movement “Loosing the Bonds: The United States and South Africa in the Apartheid Years” was published in 1998 by Doubleday. It received the Lionel Gelber Prize, the largest non-fiction prize in the world, given for the best book in English on foreign relations.

From 1996 to 2003, Massie served as the executive director of Ceres, a powerful coalition of institutional investors and environmental and public interest groups in the United States. From 1998 to 2005 he was the co-founder and first chair of the Global Reporting Initiative, a sustainability disclosure standard now in use by nearly 10,000 global multinationals.

In 2002 he conceived of the first Institutional Investor Summit on Climate Risk at United Nations headquarters, which led in 2003 to the formation to the Investor Network on Climate Risk (www.incr.com). INCR is an active alliance of 100 U.S. pension funds worth more than $11 trillion who have moved dozens of major utilities, insurance companies, investment banks, and other key industries to assess the financial costs of climate change.

From 2012 to 2014 Dr. Massie was the president of the New Economy Coalition, an organization of more than 120 US, English, and Canadian organizations interested in new models of business and economics to achieve a just and sustainable world.

In November 2015 he became the executive director of the Sustainable Solutions Lab (SSL) at UMass Boston, a new entity created jointly by the School for the Environment, the College of Management, the College of Liberal Arts, and the McCormack Graduate School for Policy and Global Studies. SSL focuses on intersection of climate change and social justice in Boston and other coastal cities in the United States.

Democracy Trumped – Understanding Trump’s Propaganda

By W. Lance Bennett.

How did a brand magnate reality TV star with a vindictive style and no political experience become president of the United States? Why did so many people vote to ignore climate change, pull back from the global economy, and disrupt North Atlantic relations?

A few years back I asked a colleague in Italy to explain Berlusconi. He pointed to a corrupted and dysfunctional political system that angered voters enough to throw a bomb into government. Never mind that Trump, like Berlusconi, oozes a special corruption all his own. Most of the press and party elites missed the scale of angry emotion aimed at them by white working and middle class Americans. Indeed, the cosmopolitan press had long rendered these folk nearly invisible, brushing off the early warning signs of the Tea Party as a minor disturbance. And so, most media experts and party insiders engaged in knowing discussions of how impossible it would be for anyone to be elected with Trump’s combination of inexperience, shady business dealings, and inability to manage his emotions and stay on script.

Winning votes through Marketing: emotio, not ratio

Meanwhile, Trump found and fed the white anger with simple, emotional messages, such as the promise to “drain the swamp” in Washington. He branded “Crooked Hillary” as the ultimate insider, with close ties to the banks, a trail of (largely manufactured) scandals, and trouble drawing a line between official business, the Clinton Foundation, and her ties to Wall Street. Despite the baggage that Clinton carried through the campaign, she did win the popular vote, and might have won the election had the (Republican) FBI director not renewed an investigation of her handling of official emails as Secretary of State.

This was the “October surprise” that sent many undecided voters, including a majority of white women, to Trump. Clinton tried in vain to get policy messages into the news, but Trump dominated the daily media spectacle with tirades against immigrants, government corruption, establishment politicians from both parties, the press, and the global economy. His clarion call at rallies was “I am your voice.” When he mentioned Clinton, the crowds ritualistically chanted “lock her up,” which he promised to do. Reporters were herded like cattle into fenced pens at rallies, and crowds shook their fists and chanted at them when Trump  denounced the lying, biased media. Reporters needed Secret Service protection at these events.

A radical right social movement against the Establishment

Through his deft use of social and conventional media and relentless appearances at rallies, Trump created a movement that revealed, like Bernie Sanders in the Democratic primaries that selected Clinton, the emptiness of the US party system. The Trump revolt echoes the rise of the radical right sweeping European democracies. Traditional parties have become “hollowed out,” in Peter Mair’s term, uninterested in engaging voters beyond crude marketing campaigns at election time. The British felt this shock with the Brexit vote, and no fewer than 28 countries in Europe have radical right parties on the rise, or already in power and threatening basic democratic values. Even though the radical left is as numerous and angry as the right, it is burdened with identity politics and the romance of deliberative democracy, which undermines conventional party organization, leadership, and the capacity to generate appealing ideas that travel via simple emotional messages.

How cosmopolitan arrogance lost the election

The specter haunting democracy today is the legacy of centrist neoliberal elites, and the press organizations that cover them. The core democratic institutions of press and politics have failed to engage white working class populations that have been economic casualties of globalization. Perhaps even more troubling is the failure of the center left and right to engage white middle classes who are more the symbolic casualties of globalization. These are the god fearing Christians for whom racial and patriarchal privilege once offered social identity and status, and who now feel threatened by multiculturalism, immigration and Islam. Yet, neoliberal politicians from Tony Blair to Barack Obama have told them that globalization is irreversible, so get over it. Clinton’s message of “stronger together” surely felt wrong to those who lived in Trump’s America and wanted to make their nation great again – in their own image.

Popumisms  greatest weapon is propaganda supported by social media

Beyond the lying mainstream press, which Trump helped his followers deconstruct every day, Trump’s coded messages of resurgent white nationalism circulated through the alternative or “Alt” right media system in the US. This network includes radio talk personalities such as Rush Limbaugh, with 13 million listeners, who issued daily defenses of Trump’s many miscues in the final months of the campaign. Among hundreds of Alt right websites is Breitbart with 19 million unique monthly visitors.

Late in the summer, when struggling with self-inflicted damage in the establishment press, Trump picked Breitbart publisher Steve Bannon to head his campaign. The campaign media team was soon joined by Roger Ailes, who began his political career reinventing Richard Nixon for the television age, and later headed Rupert Murdoch’s Fox News channel until he was driven out by a sexual harassment scandal. Bannon and Ailes have visions of consolidating their victory by forging a Trump media network that will serve as a surrogate party organization, and bypass the mainstream press in keeping Trump propaganda flowing to supporters.

A new order?

In light of these trends, it is time to ask: What is the future of democracy given the imbalance between left and right, and the disdain shown by many victorious right politicians for civil liberties, moral tolerance, racial, sexual, and religious diversity, press freedom, and basic civility? Those of us who benefit from cosmopolitan societies and global economies have failed to notice that democratic institutions of press and parties have withered, while a new and more ominous political and communication order has emerged in our midst.


Lance Bennett is professor of political science and Ruddick C. Lawrence Professor of Communication at University of Washington, Seattle USA. His most recent book is News: The Politics of Illusion (10th Edition, University of Chicago Press). He is also founder and director of the Center for Communication and Civic Engagement. and is on Twitter.

pic by aux

Rising Inequality and Political Backlash

By Kate Grosser.

Widening income inequality has become the defining challenges of our time. Not only has this issue been highlighted in recent years by the IMF, the OECD, and the Economic Policy Institute, Washington, among others, but it is at the centre of much analyses of the causes of Trump’s US election victory, including Dirk Matten’s great blog on this site last week. The gap between the rich and poor is reportedly at its highest level in decades in advanced economies. While this trend has been more mixed in emerging markets and developing countries, pervasive inequities remain, and it is increasingly recognized that inequality impacts negatively upon growth, sustainability and political stability.

Contesting the Equality and Gendered Value of “Creating Shared Value” is an urgent task

So what does this tell us about our success in ‘Creating Shared Value’? It would seem we urgently need to pay a lot more attention to what we mean by ‘shared’ and, in particular, to how corporate practices impact upon inequality at all levels of society, across all stakeholder domains, and in the wider economy and polity. Notably the IMF confirms that gender inequality is strongly associated with income inequality and that this holds for countries across all levels of development. Thus we live in particularly challenging times for gender equality. How are we going to address these challenges more effectively?

Corporations have been shown to rely on gender and other forms of inequality as a resource, exploiting women’s low pay globally, and especially in supply chains in developing countries for example, and relying upon invisible and unpaid care work, done mostly by women, to sustain workers and organizations. However, it is also true that business has the power to make changes that can impact huge numbers of women, as well as men, in positive ways through new business models and new approaches to responsible business. Yet, corporate claims to be advancing equality MUST be investigated and evaluated by feminist scholars, and others working on different forms of inequality, in collaboration with the so called ‘beneficiaries’ of CSR, to assess progress in this regard.

Emerging research on CSR, gender, and other forms of inequality – what are we learning?

Among the growing research outputs on inequality issues and CSR, including those addressing gender, development, and indigenous studies, many have raised questions about the nature of shared value. They have also frequently suggested ways forward on this issue, including the need to listen to, and act upon, knowledge that comes from the ‘margins’ of our field, and of mainstream society. However, while such research in CSR is more critical than ever, the impact of this work, in terms of research and practice, will depend to a large extent on levels of interest among CSR scholars in addressing inequality in our midst. A quick review of feminist scholarship for example, reveals that this routinely develops alongside, rather than as part of, mainstream theory and research, such that it is effectively ignored, its implications overlooked and its insights missed (e.g. Shanley and Pateman, 1991). In our own field Janet Borgerson (2007) finds that feminist ethics has been consistently overlooked, misunderstood, and improperly applied within business ethics. In our new edited collection on Gender and Responsible Business: Expanding CSR Horizons (Editors: Kate Grosser, Lauren McCarthy and Maureen Kilgour, Greenleaf 2016), Laura Spence points to low citations of feminist research, even that by the leading professors in our field such as Ed Freeman. Craig Prichard (2013) proposes that ‘uncitation’ does not prove that a paper is of poor quality, but rather that it is separated from the ‘dominant co-citational coalitions’ of a particular group of powerful scholars and journals. He suggests we seek out uncited papers to find new areas of importance to our field. In sum, advancing CSR research on gender and other forms of inequality will require all of us to:

  • Support and mentor those who write from the margins of our field, including women academics from a variety of backgrounds and parts of the world
  • Explore, support and cite scholarship on inequality and CSR, including feminist research;
  • Contribute to investigation of how masculinity dominates CSR research, discourse, organization and practice; and how inequality and neo-colonialism shape our field.
  • Bring the issue of rising inequality centre stage in business and society research of ALL kind

New voices on inequality and CSR

Our new book forms part of the growing literature which aims to bring new voices and perspectives to CSR. Contributions come from people in business, NGOs, as well as academia. Many chapters bring to the foreground the intersection of gender inequality with race and class inequality in global value chains and production networks. One of the strengths of these contributions is that they not only reflect feminist critiques, but also feminist engagement with CSR, including examples as to how we can do more to interrogate and improve CSR impacts with respect to equality. For example, Sofie Tornhill’s chapter provides a rare glimpse into on the ground experiences of the women ‘beneficiaries’ of corporate women’s empowerment programs. She ‘asks what do corporations do when they “empower” women?’, and finds much to be desired in the lived experiences of the women ‘entrepreneurs’ in a South African township enrolled on Coca-Cola’s 5by20 initiative.  The women in this research help us identify how we might better support gender and CSR program recipients in the future. Felicity Butler and Catherine Hoskyns report on a fair trade partnership between The Body Shop and a local sesame producer cooperative in Nicaragua that paid for care work done in the home to support the business, resulting in demonstrable benefits for women involved, and for gender equality, despite the wider institutional challenges. Elizabeth Prugl’s chapter explores how we might challenge the rise of neoliberal feminism via CSR, with its focus on individuals, and return our attention to the pressing questions of structural inequality. In line with a new focus on wellbeing inequality, as opposed to just economic inequality, other chapters extend the boundaries of CSR to interrogate Corporate Sexual Responsibility (relating to the use of strip clubs and pornography as part of business transactions, or on business travel), hegemonic masculinity, sexist culture in the gaming industry, reproductive technologies, and corporate philanthropy supporting work on violence against women. Issues of sexual harassment, such as that boasted about by Trump, perpetuate inequality and are key to a CSR agenda that extends to human rights.

Beyond the myth of “shared value”

To avoid wasting the crisis of Trump presidency as Dirk Matten suggests, we must move beyond our comfort zones and ‘business as usual’. Significantly more research is needed that specifically addresses the relationship between CSR and rising inequality in advanced economies, as well as globally. Focusing here has the potential to increase the relevance and usefulness of our field. In addition to challenging the role of private corporations in the governance of society, and the advance of privatization, we might focus more on: corporate taxation; investing much more in social infrastructure and the care economy, and fostering new forms of democracy in our own field, to name just a few. While, growing inequality is by no means the only cause of the current political backlash in the US and elsewhere, not for the first time in history, this comes with rising levels of explicit sexism, racism and xenophobia. If language is performative we are in danger of things getting worse for many people, and the myth of shared value, presented as a positive outcome for all, must be interrogated, contested and exposed more widely than Crane et al. (2014) suggest, because the data on inequality globally testify to the fact that the current system is not sharing value so much as it is extracting it. Moreover, this extraction is gendered (as well as racialised and classed) in important ways. The US election result reveals that we ignore this challenge at our peril.


Kate Grosser is a Senior Lecturer in the School of Management at RMIT University in Melbourne, and a Visiting Fellow in 2016 with the VELUX Chair in Corporate Sustainability, Copenhagen Business School. She researches gender and CSR, feminist organization theory, political CSR, feminist movements and CSR, culture and sustainability. She is on Twitter @KateGrosser and recently published a collection on Gender and Responsible Business: Expanding CSR Horizons (Editors: Kate Grosser, Lauren McCarthy and Maureen Kilgour, Greenleaf 2016).

pic by Greenleaf.

Let’s not waste the crisis of a Trump Presidency

By Dirk Matten

Last Tuesday’s election in the US has left the world in shock. As entertaining, astonishing, at times surely revolting, the Trump performance has been during the campaign – I do not know anybody that would have predicted him actually making it into the Oval Office. But that is history now.
I found myself always harboring rather ambiguous thoughts and sentiments regarding Trump’s ascent. But being surrounded by folks where even the slightest empathy with Trump made myself look like a total moron  – I learned to keep my feelings to myself, not at least in the hope I somehow got this wrong.

To begin with, I was not at all surprised to see Trump win the election. In some ways, this outcome is the logical conclusion of more than three decades of neoliberalism in the US. It did not help that his opponent had virtually nothing to offer to counter the very anxieties that carried Trump over every however unlikely hurdle during the campaign.

With all the shock and depression now seeping through the mainstream media there is one thing I really cherish and find extraordinary about this election: Trump won this election as an, albeit wealthy, outsider – against the united front of the media, the political class and the moneyed elites in the US and beyond. It helped that he is wealthy but that is not the main point. Even fairly balanced media outlets, such as the New York Times or the The New Yorker, over the last months just read as thinly disguised pro-Hilary propaganda; out of 55 main newspapers in the US, only one (1!) endorsed Trump. And yet he won the election. This should give other forces in many liberal democracies something to ponder. It is possible to beat ‘the system’, and in some way I am a little confused why this enormous victory of bottom-up democracy is not celebrated for what it is.

Trump is a symptom

Of course the main problem with Trump is Trump-the-person. He did all but help himself in giving fodder to the public to embark on an almost two-year project of character assassination. But again, I happen to have a different take on this. Did he tell a lot of lies? Of course. But then let’s not forget why Bush and Blair started the Iraq war. Lying is an integral part of US politics (and I am not even talking about his opponent’s husband when dealing with his White House romance). Trump said preposterous things about women. But in some way he just bragged about things that actually no one enacted more by the book then his opponent’s husband – covered up and tacitly supported by her for decades. Did he say racist things about Mexicans? Yes, but then let’s have a look at the 2.5m ‘aliens’ the Obama administration deported between 2009 and 2015. Did he say absurd things about Muslims? He sure did, but again, what he expressed is already social consensus in the US. Just think of the many people bumped off airplanes in the US recently just because they ‘looked’ or ‘spoke’ like Muslims (i.e. terrorists). Oh, and he has no experience in political office, right? Have we all forgotten that the same was said – on good grounds, at that – of his predecessor? Yes, he was talking about ‘bombing the sh** out of ISIS’. But wasn’t that exactly what his Nobel Peace price winning predecessor actually did for eight years by chaperoning a global drone war that killed almost 5,000 (incl. ca. 500 civilians)?

All I am saying then is that the media still tries to paint him as ‘unamerican’, as against the current political culture, as a pariah. The truth is, however, that he just unapologetically verbalised what is common practice all long. The United States – and I am talking about the political and economic system, as well as about half of the population – are an inherently racist, bigoted, violent and unfair country these days. As much as one may reject Trump as president – I think that his presidency just tells the true and accurate story about the moral morass the country has gotten into over the last three decades. It is ugly, but it is nonetheless not just attributable to one symbolic person.

Which leads to a big, often ignored or belittled core question. Trump did win the election because about half of the American electorate agrees with him. The real question we have to ask is what happened to the oldest democracy, a country that – 70 years ago – pacified Europe and gave the continent a new political setup based on enlightenment values. We just have to acknowledge that these United States are history now and that the country has been indeed on a steep decline in cherishing some of the core values which made it the world’s only superpower in the second half of the 20th century.

The America today is the America of ‘Dogville’, ‘Manderlay’ (as my Danish readers would appreciate) or ‘A History of Violence’, rather than ‘Independence Day’ or ‘Forrest Gump’. Trump’s majority is not just angry white men, as some want to make us believe. He represents a much wider fraction of American society as some of the poll’s analyses now painfully unveil.

So, what is the agenda then?

So do we have to be afraid of a Trump administration? On balance, I would be rather relaxed here. Not that I am not worried about some aspects. The main of which would be that many of the things he said during the campaign – as much as I am convinced he said them just as a good marketer and with an eye on his target constituency – can have rather ugly effects on common people. He legitimised racist and violent language, and it is no surprise that we have, for instance, seen hate crimes rising. If what I hear from friends in the US just these last two days is anything to go by, his words have legitimised and empowered views and behaviours which for a long time were at least publicly suppressed. He has opened a pandora’s box, for sure. And whether this spirit can be put back remains indeed an open question.

Beyond that, I feel very much reminded of Ronald Reagan’s election in 1980. I remember people saying back then that ‘Reagan is a 2nd rate actor, delivering a 1st rate performance at playing a 3rd rate president’ and stuff like that. Reagan was initially a joke and a lot of what he said (‘Mr Gorbachev, tear down this wall!’) wasn’t political correct or even sane at the time. I would really doubt if a three times divorced New York socialite will actually embark on some of the socially conservative projects (with regard to race, immigration or women’s rights) which popped up so frequently in his campaign.

In some way the crucial litmus test of his presidency will be if he will be able to actually address the social and economic worries of his core constituencies. These issues are somewhat similar to the Sanders agenda, and the agendas of many other left wing political movements throughout the world. Will Trump be able to substantially improve the living conditions of middle- and working class Americans, regarding income, access to healthcare, education and other welfare state features? It is here where he has a real chance to become ‘Reaganesque’ – albeit in mostly reversing many of the political changes Reagan initiated in America and which ultimately brought the country to this dismal place.

So what to watch then in the business-society context?

So like any good paper, I should finally make the sharp turn on this blog to what editors tend to call the ‘managerial implications’ ☺ (I hope you get the joke…).

Actually, there are a few. My main point here is really that as much as Trump’s presidency can be seen as a disaster, it is just a brutally espoused symptom of a failed economic and social experiment. What really puts me off is that even now post election many smart minds seem to run away from that conclusion and rather engage in a lament of the candidate’s horrible character (as much as I agree, watching him and his lot on the stage Wednesday early morning was ugly- but that’s a distraction).

It takes the sleazy, ‘bridge and tunnel person’ (as Manhattan establishment figures still derogatorily refer to him) from Queens to defeat a political system that is largely in the pocket of the moneyed elites, using corporations to make sure their class interests are dominating American politics. It is here that Hillary’s defeat makes me happy indeed. With hers and her husband’s massive obligations to the corporate world, we would just have continued the same system over and over again, behind the veil of the wonderful advancement of a woman president (btw, exactly the same thing we have seen with Obama, just replace ‘woman’ by ‘black’).

Trump’s victory then spells out one simple fact. Capitalism (in the form we have cultivated it in the US and globally for the last four decades) and democracy are just not compatible. Democracy is more than just giving people a vote every four years. As T.H. Marshall has posited ‘the fullest expression of citizenship requires a democratic welfare state’. Democracy only works if the electorate has some basic provision of a dignified life, a basic sense of participation in determining their material living conditions, as well as the basic education that allows informed and critical political choices.

It is fair to say that the neoliberal project has infringed, if not abolished, these basic elements of a vibrant democracy. Let’s not forget, the ascent of the US as a superpower in the second half of the last century was built on the New Deal, on the idea that a vibrant democracy (in the face of the rise of fascism and communism in other parts of the world) needs a basic welfare state with the result of what we have come to know as a ‘middle class’. The people that elected Trump all represent the part of American society that no longer enjoys these pivotal elements of a democratic community. That is why they fall for simple answers (be them racist, bigoted, religious, misogynist or otherwise).

One of the main driving forces behind these shifts has been the interests of capital, the interests of the wealthy elites, enacted through their control of private corporations. Culminating in the Citizens United ruling of the Supreme Court, we have witnessed the creeping and dominant interests of private corporations capturing the political process in the US over the last four decades.

It is indeed the pivotal role of private corporations which in my view is one core problem that the Trump victory epitomises. I am actually not pinning too much hope on the Trump administration itself to change anything substantial here. After all, with a republican controlled congress, and a democratic ‘opposition’ which is largely in the pockets of the corporate world, I don’t see any hope for substantial change. The Obama administration was probably trying the hardest in recent history to move the agenda, be it in consumer protection, access to healthcare or regulating the financial sector – and we all know how well that went. The Affordable Care Act was a healthcare reform, that did not substantially infringe corporate interests and control. It very well might ultimately be considered as one of the key drivers that energized Trump’s base – given the substantial rises in premiums during this last year.

No, I would, first of all, urge any scholar, any public commentator, anybody able to make a contribution to the debate we have to have here, to, first, not just dismiss this week’s election as an outlier and something that can mostly be attributed to one crazy person. It is of the essence to see this election result as part of a fundamental crisis of western democracies – and the US is just again the showcase here. Brexit and the rise of the far right in Europe is just another symptom of the same problem.

What is the underlying problem here?

The core problem is the role of private corporations in the governance of society. On a macro level this implies re-thinking the big questions about regulating markets, most notably financial markets and labor markets. It also involves re-thinking basic institutions of welfare provision. This might also include a debate on new forms of division of labor between the private and the public sector. Since for technological and (geo-)political reasons it will not be able to just turn the clock back to the 1950s new forms of non-employment based welfare models need to be discussed and developed, including things like basic income and other new institutional arrangements. We basically have to invent new – or reinvigorate to some degree old – forms of income redistribution, through intelligent new forms of taxation and other ways of addressing the vast inequalities. Mind you, the urge to change our current model of capitalism is no longer some sort of leftist or anti-corporate agenda. It is meanwhile becoming more and more clear also to business leaders that the current capitalist system, and particularly the role of corporations within it, is no longer sustainable. As some of those CEOs, such as Dominic Barton (McKinsey), Paul Polman (Unilever) or Ratan Tata (Tata Sons) argue, we have to ‘re-imagine’ capitalism in substantial ways (see Kipping/Barton/Horvath 2016).

On a meso level, we need more thorough work on a re-conceputalised role of the corporation, and its essentially political nature. As Robert Reich outlined time and again, the corporation in the US is just dominated by two interest: ultimately by shareholders, i.e. capital, and on a more instrumental level, by consumers. And this is still the accepted model, more or less, in business school academia and teaching. Not that we have not seen efforts recently to change this (see for instance Baars/Spicer 2017). This effort though has to be sustained, broadened and conducted in a more interdisciplinary mindset.
Ultimately, on a micro level, the relation between corporate management – across all disciplines – and the public good has to be re-introduced as a legitimate field of inquiry. So far, most of the business school research never really transcends the traditional management model of corporations being just economic actors. That even applies to the subfield on which one might pin the highest hopes: research in corporate (social) responsibility, ethics or sustainability. But even this subfield is largely constrained by a thinking in business cases and even new offshoots, such as the debate on ‘political CSR’ never quite embraces a political role of business beyond these constraints.

For a short blog such as this one, there remains of course a lot more to say. I just wanted to put some thought triggers together. Quite often – and in my view quite falsely – commentators have evoked the comparison with Germany 1933 when evaluating Trump’s rise to the presidency. Donald is no Adolf, sorry, and Washington 2016 is nothing like Weimar 1933. But if you twist my arm, I would allow one parallel here. The historically most successful reaction to the depression of the late 1920s still is the New Deal. While I am also aware that Trump is no FDR, this situation of apparent crisis should, first of all, enable a more open and honest discussion about the reasons for Trump’s ascent. And we can all agree that this IS a crisis indeed. But we should capitalise on this crisis to develop new ideas around the way we have organised social and economic life in liberal democracies. The one certainty we can take away from this is then that the role, functions and impact of private corporations is at the heart of such a debate.
Exciting times then for business related scholarship!

References

Baars, G. & Spicer, A. (Eds.), The Corporation: A Critical, Interdisciplinary Handbook. Cambridge/New York: Cambridge University Press

Barton, D., Horvath, D. & Kipping, M. (Eds.), Re-Imagining Capitalism : Building a responsible, long-term model. Oxford/New York: Oxford University Press


Dirk Matten is Hewlett Packard-Chair in Corporate Social Responsibility and Professor of Strategy at Schulich School of Business, York University, Toronto. Since 2015, he visits CBS as a research fellow. You can visit his website and drop a tweet @dirkmatten .

Pic by The Economic Times

Merken

How Could the Democrats Get it so Wrong?

By Jette Steen Knudsen.

Today I heard Hillary Clinton give her concession speech after one of the most surprising electoral results in US history.  Mrs. Clinton was poised, calm and calling for her supporters to give Donald Trump a chance to lead for the good of the USA.  The facial expressions of her supporters said it all – they looked stunned, disappointed and many were in tears.

It should have been an easy win for Hillary Clinton

Hillary Clinton was supposed to have won the election by a solid margin.  Her polling figures were strong even after F.B.I. Director Mr. Comey just days before the election announced that the F.B.I. had discovered new emails that might be relevant to its investigation of her, which ended in July this year with no charges.  Mrs. Clinton was a strong and knowledgeable candidate on the campaign trail.  In contrast Trump time and time again looked like he did not know what he was doing, which made him an easy target for Saturday Night Live or other comedy shows.  Many well-known Republicans also refused to support Donald Trump’s candidacy.  The Republican Speaker of the House Paul Ryan refused to campaign with or defend Donald Trump during his presidential campaign.   Former Republican Presidents George W. Bush and George W.H. Bush refused to endorse Trump, as did Colin Powell, the former Joint Chiefs of Staff and a well-known Republican. It should therefore have been a walk in the park for Hillary Clinton.  As her ally Senator Elizabeth Warren from Massachusetts said on Election Day on local television: “Thankfully soon we will no longer have to care about what Donald Trump has to say”.  But Mr. Trump won the election carrying several states that traditionally vote for the Democratic candidate.  What went wrong for Mrs. Clinton?

This Country is More Divided Than We Thought

In her concession speech Hillary Clinton concluded with a somewhat surprised look on her face “this country is more divided than we thought”.  In contrast while her campaign may not have understood the extent of the polarization of the American electorate, Donald Trump clearly understood the strong discontent and feeling of exclusion among especially white non-college educated men.  Back in July the filmmaker and social critic Michael Moore wrote that Trump needed only to focus on the blue states Ohio, Wisconsin, Michigan and Pennsylvania and noted his theory of “The Last Stand of the Angry White Man.”  “There is a sense that the power has slipped out of their hands, that their way of doing things is no longer how things are done,” Moore wrote.

What’s the Matter with Kansas?

But why do so many Americans seemingly vote against their interest?  In 2004 the journalist Thomas Frank published a book with the title “What’s the Matter with Kansas? – How Conservatives Won the Heart of America”.  Mr. Frank asks why poor people in the heartland of America vote Republican when – at least for people of the East and West coasts of the US – the Democrats are the party for workers, the poor and the weak.  In other words, why do so many Americans vote against their economic and social interests?  Mr. Frank answers this question by examining his home state Kansas and reveals how conservatism, formerly a market of class privilege, became the creed of ordinary Americans.  This conservatism has mobilized voters with explosive social issues such as busing, un-Christian art and abortion and these issues then get married to pro-business economic policies. Add to this that in states such as Michigan and Pennsylvania traditional manufacturing jobs have been lost as factories or mines have closed downs.  Service sector jobs don’t pay as well as manufacturing jobs.  For example Wal-Mart or Dunkin Donut pay the minimum wage, which in Michigan is $8,50 /hour and in Pennsylvania only $7,25/hour.  At the same time health care costs and college tuition have soared in America. It is no wonder that white unskilled workers feel left out of the American Dream.  Mr. Trump’s promise to “Make America Great Again” resonates well in the American Heartland.

Democrats on the Coasts

Well-educated high earning Americans live in the coastal areas in cities such as Boston, San Francisco or Los Angeles – and they overwhelmingly vote Democratic. The Democratic Party also made great attempts to include Blacks and Latinos but as a commentator in the New York Times (which had endorsed Mrs. Clinton) conceded this past Sunday, Trump has done one thing right – he has acknowledged that Blacks have not gained much economic or civil rights advances in recent years and that he understands their frustration.  East and West Coast liberals have simply failed to understand the frustration of Middle America – and the majority of Clinton’s campaign staff hails from the coasts.  The Democratic campaign has probably underestimated the frustration of Blacks and Latinos because although Clinton got more votes from these two groups than Mr. Trump, she got significantly less votes from these groups than President Obama did in 2012.

Midterm Exam Postponed for Teens Mentally Disturbed by the Election Result

The Democrats on the US coasts do not understand Mr. Trump’s supporters and sometimes live in a “bubble”.  For example my son’s great public high school in Cambridge in Massachusetts is one such bubble.  Cambridge is one of the most liberal cities in the US and is also known as “The People’s Republic of Cambridge”. Students at the high school expected a Clinton victory and almost all students supported her.  After the election result came in today, many students were grieving.  Many were crying and today’s midterm exams were postponed because too many students were psychologically distraught.  This small example illustrates how far the East Coast liberal segment is from Trump’s Middle America. 

To unify America will be a long and difficult process.


Jette Steen Knudsen is Shelby Collum Davis Professor at Tufts University near Boston and a Visiting Fellow of the Velux Endowed Chair of Corporate Sustainability at Copenhagen Business School. She resides in Cambridge MA with her teenage son.

pic by Heat Street

The F-Word in Denmark

By Lauren McCarthy.

The proposed subtitle for this blog was ‘Why is it more acceptable to say ‘f**k’ in the classroom than ‘feminist?’’ but I thought it might be a bit too strong for most of your inboxes! But indeed, after some time working here in Copenhagen as an assistant professor, and living as a self-professed feminist, it is a question that has continued to perplex me.

No, the swearing doesn’t bother me, although many non-Danes find the embrace of swearing in the classroom, at work, on the radio and in adverts either hilarious, or offensive (by way of glorious coincidence, see the striking poster from Kvindemuseet (The Women’s Museum). Rather, I have on various occasions been told that using the other ‘f-word’, feminism, is taboo. Especially in the classroom. What’s interesting is that a warning over dropping the f-bomb in front of students usually comes from older friends and colleagues, both men and women. Don’t get me wrong, I’m not walking into a lecture theatre ranting about women’s rights, when what is scheduled is a session on corporate governance. But I AM researching and teaching about corporate social responsibility and sustainability, both topics that are inherently gendered and political. Sometimes it makes sense to mention the dreaded F-word in those contexts. And I think the fear of feminism as something we might talk about in business education comes from two places: a misunderstanding of what feminism is; and perhaps complacency about its need in modern Denmark.

Everyday Feminism

The word ‘feminism’ often provokes expressions of mild horror. It conjures up grainy photos from the 1970s of women, living au natural in communes, ‘hating men’ (as one of my students put it). Others have suggested that being feminist involves rejecting high-heels, or make-up, or the desire to be a mother. When you put all that together (witchy, bra-less, slightly-wild single woman in a homemade dress?) I’ve no wonder my sessions on feminist theory might sound alarming!

For many people worldwide, this stereotype persists. Yet if we tone-down this characterisation, at it’s most basic, feminism is the fight for human beings to live their lives without their gender or sex hindering them from achieving what they wish to. This fight is hundreds of years old. Feminism is political, economic and social. It involves governments, international organisations, businesses, NGOs, and most crucially ‘normal’ people going about their everyday business: calling out that off-colour joke at lunch; tweeting about overly sexualised advertising; writing about online abuse or raising their children unconfined to gender roles. And yes, all whilst wearing make-up, or getting married, or being a feminist man- if one chooses to.

A feminist utopia?

So that’s my take on feminism. Perhaps my surprise at the rejection of feminism was because I assumed that in one of the world’s most gender equitable countries everyone would be a feminist. But perhaps because Denmark is perceived in this way, the need for feminism appears to be over. Unfortunately this doesn’t quite seem to be the case.

Last week Denmark fell another four places down the World Economic Forum’s Global Gender Gapratings, from 14th to 19th place. Sweden, Finland, Norway and Iceland take the top four places, but their Nordic neighbour Denmark continues to lag behind. In 2014 an EU survey revealed that Denmark has amongst the highest prevalence of domestic violence within the EU. Yet these surveys reveal only part of the story. The fantastic Everyday Sexism Denmark post testimonies from women experiencing (you guessed it) everyday sexism, often in their workplace or school. All of this suggests that whilst on paper things often look good for women (for example, in excellent parental leave policies, and a growing number of women in senior roles), the reality is that men and women are often held to differing standards, and that this become so normalised, so ingrained, that we might assume everything is fine. Activists such as Emma Holten are pointing out that things aren’t equal, or equitable, and that perhaps Denmark has become disillusioned in this regard: “Our idea that everything is great and fine in terms of human rights and respectful discourse is actively combating our ability to progress in these areas.”

The feminist future

Emma Holten is symbolic of young Danish feminists using their own experiences, often with wit and humour, to reignite a conversation about gender equality. Slowly there’s been a resurgence in feminism in the last few years (albeit a lot slower than in the UK and USA), facilitated by social media. Facebook pages and Twitter accounts such as Everyday SexismOverheard Sexism in DenmarkYoung Feministsand others collect thousands of likes, post and shares. I’m happy to report that closer to home Copenhagen Business School now has a feminist society enthusiastically run by students. Online lives spill into our offline lives, and within my classroom there is a genuine interest in discussing the role of feminism today- in politics, in the media and in business.

Feminist responsible business education

Some might argue we need a new term for the fight for gender equality, or that feminism excludes other, equally important social injustices. But the F-Word isn’t going away, it’s getting louder. Feminist theory offers lenses into understanding how social change happens, and continues to happen. The history of feminist activism demonstrates the politics of the everyday. And feminism is a living, breathing phenomenon that is being adopted once again- by people as diverse as Beyonce, Ban Ki Moon and Muhtar Kent (CEO of Coca-Cola). What does it mean when these people use the word? What does it mean for business? For feminism? If we’re going to teach and research how we might lead, manage and create responsible businesses, let’s throw out the stereotypes and explore modern feminism in 2016.


Lauren McCarthy is Assistant Professor of Sustainability and Governance in the Centre for Corporate Social Responsibility, Copenhagen Business School. She researches and teaches about gender and CSR in organisations and their global value chains. She is currently exploring online feminist activism in the UK. You can follow her updates @genderCSR .

Pic by kvindemuseet.

The Ecosystem of Shared Value – Unoriginal, But Still Likely to Make an Impact

by Andreas Rasche.

The October 2016 issue of the Harvard Business Review contains an article by Mark Kramer and Marc Pfitzer called “The Ecosystem of Shared Value.” Positioned as a follow-up to Porter and Kramer’s very successful essay on “Creating Shared Value” (CSV), the authors suggest that to “advance shared value efforts […] businesses must foster and participate in multisector coalitions—and for that they need a new framework. Governments, NGOs, companies, and community members all have essential roles to play, yet they work more often in opposition than in alignment.” This new framework has a nice new label – Collective Impact.

A big (but unoriginal) idea… 

My claim here is that this new concept – Collective Impact – is oversimplifying and rather unoriginal (but nevertheless will be successful, at least in terms of corporations trying to reproduce the label and academics citing the paper). Much like its predecessor CSV, Collective Impact is old wine in new bottles; a new label for something we have known, studied, and practiced for many years. Talking about Collective Impact ignores the multi-stakeholder nature of many initiatives and partnerships within the field of sustainability and CSR. For instance, multi-stakeholder initiatives, such as the Forest Stewardship Council and the Fair Labor Association, have practiced collective impact for many years.

Also, partnership-based organizations like the Oxford Health Alliance have practiced many of the elements of what Kramer and Pfitzer call Collective Impact (e.g. a common agenda and mutually reinforcing activities). Even most quite simple NGO-business partnerships have these characteristics. Overall, it is hard to disagree with what Kramer and Pfitzer are writing, but it is equally hard to see any groundbreaking new idea here…

Collective Impact is also unoriginal in another way. My colleagues Andy Crane, Guido Palazzo, Laura Spence and Dirk Matten have convincingly argued in an article in the California Management Review a while ago, that CSV is an unoriginal concept and that its core premises have many similarities with well-known ideas in the CSR discourse (e.g., strategic CSR). They also showed that one of the core avenues for CSV – local cluster development – is neither new nor in any way surprising. Local clusters – which essentially are just a way to create collective impact – have been part and parcel of debates around sustainability in academia and practice. Understood in this way, Collective Impact just reiterates a part of the CSV story (which was unoriginal in the first place).

Why will the idea still be successful?

Considering all this, the important question seems to be: Why can concepts such as Collective Impact or CSV still make such an impact, despite their vague and unoriginal nature? One possible answer to this question relates to the so-called Matthew Effect in science. Robert K. Merton (1968) first observed this effect. The main claim is this: the credit for scientific work is distributed unequally. If similar research findings are communicated by a well-known, prestigious scholar and by one who is less widely known, it is the first who usually gets recognition. In other words, scientists with an existing good reputation receive greater increments of recognition, while the contributions of unknown scholars are rendered less visible. This makes science a “sticky”, path-dependent and self-reinforcing business…

Collective Impact and CSV (as well as other management fashions) are not successful because they offer new and innovative solutions. Rather, a significant part of their success can be attributed:

(a) to the already existing reputation of the people who promote the concept (in the case of Collective Impact we can assume positive legitimacy spillover effects of Porter’s work on CSV),
(b) to the perceived legitimacy of the outlet that the idea is published in (in this sense the Matthew Effect would not only be applicable to people but also to outlets), and
(c) to the short and simplifying nature of the message that is being sent.

All of this is not to say that Collective Impact, as framed by Kramer and Pfitzer, is totally useless or that it should not be published. Nobody has a patent on the idea of multi-stakeholder collaboration. It is even likely to spark interesting discussions among practitioners and will (hopefully) motivate more partnership-based initiatives. What I find worrying is that packing well-established ideas into such simplifying concepts may curb the advancement of knowledge in our field.


Andreas Rasche is Professor of Business in Society at Copenhagen Business School and directs CBS World-Class Research Environment “Governing Responsible Business”. More information at: http://www.arasche.com

pic by interactioninstitute