NEWS 
 AT ADWIRED
About the purpose of purpose.
26/11/2019

In his 1962 book "Capitalism and Freedom", Milton Friedman set out the rules for how business should interact with society. "There is one and only one social responsibility of business," he wrote, and that was to "use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.“ In today’s complex world, the 'rules of the game' are justifiably expanding and increasingly include ‚soft' liabilities. However, the hype around 'corporate purpose' sets another tone; the Zeitgeist expects the company to serve society along the lines of CEO of Unilever: "We have to bring this world back to sanity and put the greater good ahead of self-interest.“ It goes without saying, that whatever the 'greater good' means, is left to decide for management. Be social (with other people's money) is the self-set mandate. How well management is able to decide what is good for society is not questioned. Weren’t these companies part of the problem? Thus, for those surfing on the purpose wave: it's the society’s call to set the 'rules of the game‘. If companies do not play along those lines, the loss of reputation will translate into economic risk and the dilemma between shareholder value and squinting on social responsibility dissolves, as it were.

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