What’s a Business For?

Virtue and integrity are key to a good economy. In the article “What’s a Business For”, Charles Handy says “Markets rely on rules and laws, but those rules and laws in turn depend on truth and trust. Conceal truth or erode trust, and the game becomes so unreliable that no one will want to play. The markets will empty and share prices will collapse, as ordinary people find other places to put their money – into their houses, maybe, or under their beds. The great virtue of capitalism – that it provides a way for the savings of society to be used for the creation of wealth–will have been eroded. So we will be left to rely increasingly on governments for the creation of our wealth, something that they have always been conspicuously bad at doing.” I completely believe what he says. We are now experiencing extremely unique and difficult circumstances. Lots of Americans are banking on a stimulus bill to get passed to help them, yet our government had a very difficult time getting one done. Relying on our government to generate out wealth will always be a bad idea.

To continue in this article, Charles says that the purpose of a business is not to make a profit. It is to make a profit to do something better. It isn’t about a means to an end, but we need to make the world better around us. That’s what wealth should be used for.

Two solutions of his that I agree with are measuring success in terms of success for others, as well as ourselves, and serving the rich while serving the poor. I think these go hand in hand. You can make a good profit and serve others. Too many people view success as making a lot of money. But it is what you do with the money that makes a difference.