IBE 30th Anniversary: the next 30 years

Publication type: Other
27 October 2016

Tags: Corporate governance, Treatment of Employees

The Institute of Business Ethics: the next thirty years is the result of a survey of opinion leaders to help identify the IBE's priorities for the coming period, the current business ethics climate and the future challenges to business in regaining trust.

Speed read

In its first three decades, the IBE has focused on helping companies with the practicalities of taking an ethical approach. In reaching its 30th Anniversary, the IBE is reflecting on the business ethics challenges in today's environment through gathering the views of others.

The Institute of Business Ethics: the next thirty years is the result of a survey of opinion leaders to help identify the IBE's priorities for the coming period, the current business ethics climate and the future challenges to business in regaining trust.

Each survey respondent was asked to answer three questions:

  1. Why can't business rebuild trust with the public?
  2. What are the three biggest ethical challenges facing business?
  3. What should the IBE do over the next few years?

About

The financial crisis, corporate scandals and levels of public distrust have lowered the standing of business. It is no longer acceptable to say business is simply about generating profits for shareholders. Business needs to show how it contributes to social well‐being wherever it operates. If business is to regain public trust, a new approach to business leadership is needed which is based on consensus building, the ability to embed values and connect business to society.

In the report, the lack of trust in business was frequently ascribed to the public perception that it was too focused on profit, the recurrence of scandals, controversy over executive pay and the taxation policies of multinationals. Business must become better aligned with the interests of society from which it derives its license to operate.  Furthermore, boards must develop a more coherent sense of what their duties as set out in Section 172 of the UK Companies Act 2006 actually are. Profit becomes legitimate when it is earned through the delivery of real value and the genuine assumption of real risk. It is not legitimate when it is achieved by extracting value from the very customers it purports to serve.

The question about the three biggest ethical challenges threw up a multitude of answers. While some homed in on specific issues like remuneration, taxation, the supply chain, diversity and cyber issues, others offered a more overarching view. Two themes stood out: customer focus and the need for statesmanship.

  1. Business needs customer champions within the leadership team so that leaders can see their business actions through the eyes of those who actually use their products.
  2. As to statesmanship, it was critical for business leaders to be able to work with others to build the basis of trust. We need to redefine successful leadership – engaged with ethical values, less iconic and with strength of character.
IBE_30th_Anniversary_The_Next_30_Years.pdf
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