When Gail Snowden talks about making profit off the
"disadvantaged" in "poor neighborhoods," like Harlem in New York and
Roxbury in Boston, not a single person in the classroom flinches.
Most of these 40 graduate students at Brandeis University are in
business school precisely because they want to learn how to make
money. And today, their pencils are flying.
But Ms. Snowden, president of the FleetBoston Financial
Foundation in Boston, isn't discussing profit alone. A black woman
raised in a family of social activists, Snowden spent years
convincing corporate higher-ups that underserved communities would
prove a vibrant resource for Fleet. Today she heads Fleet's
Community Investment Group, which directs resources into low- and
moderate- income communities.
Her work is just one proof, she says, that corporations can make
money by being socially responsible.
This reinforces the two-fold message of Prof. Michael Appell's
new course, "Corporations and Communications": Not only do
businesses have a responsibility to behave ethically, but virtue
itself can pay.
"We focus on the subject of return on responsibility," Mr. Appell
says. "Overall, companies that take CSR [corporate social
responsibility] seriously outperform those that do not."
The concept of CSR has been a part of some business school
curriculums since the 1970s, but it has earned a more prominent
place in the wake of recent business scandals. CSR is distinct,
however, from business ethics, an older term that deals with
misbehavior, such as fraud, within a company. CSR examines the
impact a corporation has on the world around it - by, say, reviving
an abandoned neighborhood or improving the working conditions of its
factories in a developing country.
"I want my students to set aside whatever assumptions they have
about NGOs [nongovernmental organizations] and business," Appell
says - specifically, the notion that NGOs do good work while
businesses make money, and that the two are mutually exclusive.
The students' own backgrounds help to challenge that dichotomy.
They come from a dozen countries and two very different graduate
programs - one focused on business and another on international
Many of the students were drawn to the class because it explores
the potential overlap between these two disciplines.
"Most of the courses an MBA has to take include corporate
finance, management, competition strategy," says Babar Lakhani, from
Karachi, Pakistan, who studies at Brandeis's Graduate School of
International Economics and Finance.
"This is something very different. It focuses on how, if everyone
is good, the bottom line will be better, and stronger, because
everyone is happier in a sense."
Deanna Becker, a student in the Heller School for Social Policy
and Management and one of the few Americans in the class, is taking
the course to learn more about the way businesses operate.
"I'm in the sustainable international development program, and we
talk about all sorts of paths toward development," she says.
"But one of the things that often gets left out is that there's
the force of business out there. I wanted to be in a class that
actually addresses the impact that businesses have."
Decades in the making
"Business ethics" has long been considered an oxymoron. In 1906,
historian Ambrose Bierce defined the corporation as "an ingenious
device for obtaining profit without individual responsibility."
In 1970, soon after the term "corporate social responsibility"
was coined, economist Milton Friedman echoed Bierce's sentiments in
The New York Times: "There is one and only one responsibility of
business - to use its resources and engage in activities designed to
increase its profits."
But in the mid-1970s, with the Watergate brouhaha still echoing
and a string of business scandals revealing massive fraudulence and
waste, the mere discussion of ethics was deemed insufficient. …