JEBO special issue on Evolution
Adam Smith is on the Loose – Again!

Spiritual Capital in Business

Jonathan B. Wight

The John Templeton Foundation has funded a number of conferences around the world to explore the issue of spiritual capital in a business setting. To set the stage:

 “Spiritual capital is the fund of beliefs, examples, and commitments that are transmitted from generation to generation through a religious, moral or spiritual tradition, and which attach people to the transcendental source of human happiness.”  (Theodore Roosevelt Malloch, Yale conference on Practical Wisdom in Management, July 2013.)

 The final conference was held at Yale University’s School of Divinity last week.  It was a wonderful experience to be a part of this endeavor to: 1) explain how successful businesses can operate on the basis of principles that are supported by spiritual traditions; and 2) to popularize the view that markets can do far more than provide profits to shareholders.

 There were many CEOs at this conference (click on the link above to see a list) and virtually all of them were able to say from personal experience that the relentless pursuit of maximizing profits did not lead to human resource or environmental sustainability, and hence did not ultimately maximize shareholder wealth. A different approach is needed that focuses on virtues and commitments to transforming ideals.

 Profit are of course needed, just as humans need air to breathe. But the purpose of life is not to breathe air! It should be obvious that many business leaders make a lot of money by not following spiritual principles, and that some business leaders that follow spiritual principles go bankrupt. The key point is that people prefer to work for business leaders who genuinely pursue transformational goals in an ethical manner.

 Ted Malloch, who helped organize the conference along with Gilbert Lenssen, President of The Academy of Business in Society (ABIS), made an interesting comment:

"There are moral preconditions in a market economy: the sentiments of sympathy, benevolence and compassion, of approval; disapproval and indignation, which underpinned the social order and make it possible to engage in business in the first place. Human beings and the corporations they originate are not just profit-maximizers. They have moral scruples, personal commitments and the desire for happiness. These set limits to their plans for personal profit, and also stimulate them to pursue profit in ways that honor their higher values and generosity. Many companies, large and small, public and private, around the world and from each tradition exhibit fees, live and conduct business by these values thereby exhibiting their spiritual capital.

Ted has written a slew of books on this subject with co-authors:

 The End of Ethics and A Way Back: How To Fix A Fundamentally Broken Global Financial System (2013)

 America's Spiritual Capital (2012)

 Spiritual Enterprise: Doing Virtuous Business (2008)

Proponents of the spiritual capital view are now stepping up to the debate not with platitudes about CSR, but with data and many studies. This includes many studies in experimental economics.  This is an exciting time to be teaching ethics and doing business.  Business can be a calling, with meaning and purpose.

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