Abstract
Economy of mutuality provides a higher-order frame of reference for understanding what business is for and the values it presupposes and creates. This chapter equips executives and managers with a broadened perspective on business, encompassing not just market economy, but social enterprise and social economy. A spectrum of archetypes of business enterprise are considered in light of higher ends of economic life. The highest end-state of business encompassing all such archetypes, it is argued, is that of reciprocity and integral human development. The chapter concludes that, compared to market economy per se, economy of mutuality provides business executives and managers a more comprehensive conceptual framework for undertaking challenges of financial and social sustainability.
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Notes
- 1.
The concept should not to be confused with the John Kay’s notion of “economics of mutuality” (Kay 1991). Some ideas in this chapter originated in a paper delivered at a workshop entitled “Teleology and Reason in Economic and Social Affairs,” conducted at Blackfriars Hall, University of Oxford in 2014. Parts of the argument are developed further in my article “Economy of Mutuality: Merging Financial and Social Sustainability,” 133(3) Journal of Business Ethics, 499–517 (2016).
- 2.
Mission drift. Commercially-oriented microfinance institutions (MFIs) are sometimes identified as drifting away from an original mission of serving low-income clients, instead serving better-off clients to improve the financial bottom line (Armendariz and Szafarz 2011). An ethical issue arises insofar as such MFIs are found to be using poor clients mainly as a means to attaining profitability (Sandberg 2012). Excessively high interest rates. Interest rates charged by some MFIs can range between 20% and 70% per annum, making them higher than rates commanded by commercial banks (Rosenberg et al. 2009; Sandberg 2012). Group lending abuses. Violent collection practices and oppressive forms of group pressure are sometimes used by MFIs for obtaining repayment of group loans (Montgomery 1996; Ghate 2007).
- 3.
HDFC (A) Harvard Business School Case No. 9-301-093 (2000).
- 4.
Sealed Air Corporation: Globalization and Corporate Culture (A), (B), Harvard Business School Case Nos. 9-398-096, 9-398-097 (1998).
- 5.
AES Honeycomb (A), Harvard Business School Case No. 9-395-132 (1994).
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Jackson, K.T. (2019). Economy of Mutuality: Equipping the Executive Mindset for Sustainable Business. In: Lenssen, G.G., Smith, N.C. (eds) Managing Sustainable Business. Springer, Dordrecht. https://doi.org/10.1007/978-94-024-1144-7_15
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DOI: https://doi.org/10.1007/978-94-024-1144-7_15
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