The Global MBA programme recently held a competition for students to show off their writing skills. The students competed with each other by submitting an essay about the effects of the Coronavirus pandemic on any aspect of business and management. There were more than 90 entries and a panel of judges made up of the MBA Programmes Director, Head of Global MBA Student Support and Assistant MBA Director chose the winning piece.
The winner of this competition was Christian Fell who is Senior Manager at Mazars based in United Kingdom. The panel said, “The essay was insightful and very well written. We really enjoyed it and are sure other students will also enjoy reading it too.”
Read the winning essay below:
Covid 19 – the final nail in Friedman’s profits over purpose?
“Masks beneath masks until suddenly the bare bloodless skull,” noted Salman Rushdie in 1988, a statement which could easily be applied to the situation a plethora of organisations currently find themselves in, as corporate values are extinguished by revelations of contradictory behaviours. Take Boohoo plc, for example, a business exalted for its performance through much of the lockdown period. “Boohoo and its understanding of target audience helps it to weather lockdown’ proclaimed City AM editor, Stephan Shakespeare, on May 6th in recognition of its achievements. Yet, two months later, Jessi Baker MBE, writing for the same publication under the headline ‘The Boohoo scandal shouldn’t shock anyone — modern slavery is a pandemic’, remonstrated Boohoo for unethical behaviours as their share price tumbled and previously loyal customers raised eyebrows.
Perhaps an adapted version of Rushdie’s famed quote could read, ‘marketing beneath branding until suddenly the bare values of the organisation’. And it is values, which jobseekers, particularly those from ‘generation y’ and ‘z’ are paying more attention to than ever before. The pandemic period has unmasked the chasm between claims made on corporate websites and the reality of corporate social responsibility commitments in organisations across all sectors. Friedman’s argument that the ‘social responsibility of a business was to increase profits’, a doctrine widely circulated in business schools in the subsequent decades, is under more scrutiny than ever before. The pandemic period, an accelerant for many things, has created a need for many organisations to radically transform their business strategies and, in doing so, justify their existence. The pandemic, a catalyst for remote working, adoption of virtual meetings and the word ‘furlough’, has also contributed to opening Pandora’s box on socio-economic inequality, systemic racism and climate change implications.
This is a box which, now ajar, must continue to be fully opened.
The surprise arrival of a pandemic forced organisations to react instantaneously to ensure business viability. Critical decisions, made post the Downing Street announcements, were debated in boardrooms up and down the country, revenue projections revised, costs retrenched. Corporate leaders, much like a retired boxer under attack, allowed instincts to prevail. For many organisations, particularly those that dominate our FTSE markets, instincts mean doing what they always have done. Boohoo plc, for instance, re-engineered their product line and green-lit production. In many ways, they did what they always had, and they had always done it so well. Yet their failure to provide a safe environment for employees has invited speculation and inquest, ultimately devaluing the business through reputational damage. Profit, an indulgent social media page and celebrity endorsements are all fine but if the other side of the scales hold life and the environment, I’m certain which side of the argument I want to succeed.
Reports are starting to uncover maladaptive use of the UK government endorsed furlough scheme, which, as the country battles through a recession, will prove difficult news to swallow for those who are facing a long struggle back to stable ground. These revelations of malpractice will undoubtedly leave a long shadow on accused firms’ reputation, hampering their long-term sustainability. Consumers hold more power than ever before as organisations traverse an increasingly competitive landscape with tightened purse-strings intensifying customer acquisition. This presents the consumer with an opportunity to influence the behaviours of the organisations attempting to entice them into spending their hard earned, possibly dwindling, cash reserves. This is the opportunity of a lifetime.
Vote with your feet, with your wallets, with your one click payments. Hold businesses accountable. You don’t like the way they source their products? Fine. Don’t shop there. Shocked by their inaction on diversity? Excellent. Bank somewhere else.
If we are to create a commercial backdrop where purpose does trump profit, then we need to let organisations know that we won’t be tricked, idle or happy to forgive in exchange for a discount.
If Friedman is to be proved wrong, we must place more value on values.
The corporate world can, if they choose to do so, play a leading role in tackling some of societies biggest issues, whether that be through developments in sustainable finance, advancements in equality or influencing the future of climate action. The pandemic has created a platform for corporate social responsibility to evolve into a primary function of an organisation, shedding the ‘nice to have’ image and planting its place firmly at the executive table.
Finally, Friedman was also quoted as saying ‘one of the great mistakes is to judge policies and programs by their intentions rather than their results’.
Corporate world, we’re watching.