We welcome Professor Laura Spence from the Royal Holloway, University of London as this week's guest on The BIS Video & Podcast. Spence is truly an exceptional guest with extensive knowledge and background in the fields of corporate responsibility, responsible entrepreneurship, and sustainability.
Most notably, Spence has recently been selected to serve on the UK's Research Excellence Framework 2021 Evaluation Panel for Business and Management. Join Cindy Moehring as she talks with Laura about the future of business ethics education and the ways in which the UK has faced ethical dilemmas.
Podcast:
Episode Transcript:
00:00 Cindy Moehring: Hi everybody. I have with me today, Professor Laura Spence. Hi, Laura. How are you?
00:06 Laura Spence: I'm good, thank you.
00:08 Cindy Moehring: Great. Let me tell you all a little bit about Laura, she is a professor of business ethics in the School of Business and Management at Royal Holloway University of London, and she's just completed her term as Associate Dean for Research, supporting the School of Business and Management and the School of Law and Social Sciences. Laura has previously held the posts of Director for the Center of Research Into Sustainability and School Director for Research Impact. Laura has been selected to serve on the UK's Research Excellence Framework 2021 evaluation panel for Business and Management, which is quite an honor. Laura has taught at undergraduate and post-graduate level in the School of Business and Management on a range of topics related to business ethics, including corporate social responsibility, responsible entrepreneurship and sustainability. She also contributes to the PhD student course on qualitative research, particularly in relation to research ethics. Laura is also the co-author of the most widely used textbook on business ethics in Europe today titled Business Ethics, which is now in its fifth edition. She is a consulting editor for the Journal of Business Ethics and has been a trustee and now advisor to the Institute of Business Ethics, so a wealth of knowledge that we get to have the benefit of today. So it's an honor and a pleasure to have you here today, Laura, and thank you for taking some time to be with us.
01:32 Laura Spence: Oh, thank you. You're welcome.
01:35 Cindy Moehring: So let's jump in and the topic we are really in here in season two for the podcast video series, is all about the future of business ethics and the future of business ethics education, and helping to define that so that students are more prepared when they enter the world of business to deal with the issues that are, I think, coming at them faster and faster these days. Having a compass of morality, which is important in leadership when it comes to making those tough decisions, happen almost on a daily basis, it seems like. And so much has happened in the field, so I am wanting to hear from you and others about what's changed, in let's say the past 25 years or so ago, when the Harvard Business Review published an article by Andy Stark talking about what's wrong with business ethics. And at the time, it was viewed as too theoretical and too general and too impractical. And so much has changed in the last 25 years, so I wanna hear your views on that, but then more importantly, let's talk about charting that path for the future, for the next 25 years and what we think needs to be done there. So let's start with what Andy said was wrong with business ethics 25 years ago, your views on that, and where you think we've come to today?
03:02 Laura Spence: Yeah. Oh wow, thank you. This is my favorite topic. [laughter] So we're in a good space. First of all, I think 20, 25 years ago, business ethics was really a kind of subset predominantly of Applied Moral Philosophy, absolutely nothing wrong with that. And I'd say one of the biggest journeys that's happened, if you like, in relation to business ethics, is a shift to a social science perspective, and while I'm a professor of business ethics, I very much consider myself a social scientist and incorporate the use of moral theory... Yes, that kind of abstract perspective, but also social theory. And I think that starts to break things open and to really locate business ethics away from a very kind of straight and relatively narrow normative viewpoint, and there's still space for that. I think we have to draw our understanding of the frameworks that we use from somewhere and absolutely to incorporate moral philosophy, but that alone, I think really didn't do the necessary work of business ethics. And I think maybe that's where we've come some distance in the last 20, 25 years. That would be my starting point.
04:25 Cindy Moehring: Yeah. So how have we done that? Tell me a little bit about how you think we've made that leap.
04:33 Laura Spence: Well, I think it's partly the actors that have been involved. So if business ethics was... And I think it was the case that business ethics as an academic subject was dominated by a North American, probably just a US viewpoint, particularly coming from the Society for Business Ethics, which I absolutely admire and have long been involved with and engaged with and learned a great deal from. But that's just one way of looking at the world. So I think since then a whole range of voices from around the world, certainly from my kind of home territory in Europe, but also increasingly now much further afield and away from Western perspectives, has really encouraged an acknowledgement of contextualized issues and how difficult and it just doesn't fit to keep trying to put Western developed moral philosophy on every different aspect of the world. It doesn't fit. And then if you start acknowledging that, then you have to start looking for things that do fit and things that do help us explain the empirical world. And I think that in that social science is kind of a development, that's what I think is shifted is from starting from the moral philosophy, from my reading, we now start from the empirical world, and then we look back to try to explain that and whether that's social or moral philosophy or whatever theoretical perspective we use to help explain what we see. I think that the starting point's flipped in the intervening years.
06:16 Cindy Moehring: Yeah, very interesting. And sort of a broadening of perspectives, right? So a different starting point and broadening their perspectives. So you are in London and you have written with Dirk Matten, who we've also spoken to, the preeminent book that's used there. So let's talk a little bit about whether or not you think business ethics is understood the same way in, as you described, the Western world and in Europe, and do you think... Let's just start there. Do you think they're understood the same way or not, and if not, what do you think are some of the differences?
06:54 Laura Spence: I think there is, I don't wanna say convergence, but there's more crossover these days in an academic sense at least, because it's so blurred where people publish, where they're based, so many people that grew up in Europe are working in North America, and vice versa. And so you can't kind of just stick someone in kind of a space anymore and say, well, you represent a particular point of view. Maybe you never could, but we did tend to do that in the past. But from a business point of view, and people like Dirk and Jeremy Moon have written about this, the difference in approach in a European, and I probably am talking about a continental European perspective now, and a North American one can be quite different from the more individualistic perspective in North America, to the more macro governmental level understanding of how we ought to organize society in order to allow for good ethics and good social responsibility. So there is that perspective, and that still exists, it would be foolish to think it doesn't, but just as academics are kind of multi-cultural, if you like, so are businesses.
08:06 Laura Spence: So we see looking at multi-national corporations, whether that's a Danish multinational corporation, like Maersk the shipping company or an American multinational like Apple say, for example, those cultures tend to spread out with the different distribution channels and branches and different sections of the business around the world. Which brings us to this idea of spreading out ethics, if you like, and taking a, say, for example, a Danish or a US perspective on what is socially responsible and ethical, and trying to have that apply wherever you do business. That unsurprisingly is problematic and brings us to all those difficult questions around context and how we can try to perhaps... Or how businesses sometimes seek to impose their perspective of moral responsibility on cultural context where there is a very weak fit, shall we say.
09:16 Cindy Moehring: Yeah, yeah, So globalization has affected it in many respects, I hear you saying, but it doesn't always, it doesn't always fit. So more of a convergence, do you think, between the two views, which is partially a result of what has happened with just the globalization in general of academics and business, and the combining of the thought process, which I see as beneficial. It does help advance the field to break down the silos in any respect. Businesses you see that, you gather greater perspective when you break down the silos between the different departments and you broaden their perspective and kinda see the same thing happening here in terms of the views around business ethics between Europe and the United States. So it's interesting to see it evolve, and I think you described that well. So let me ask you another question about the US and Europe, and whether or not it's had any effect or not.
10:17 Cindy Moehring: So in 2019, actually just about a year ago now, the Business Roundtable put out a new pronouncement on the purpose of a corporation, and it was a change, and they had defined it as the primary purpose was for shareholders, and it stood for 22 years. And now they've changed and actually recognized more of a stakeholder theory and recognizing that the purpose of a corporation signed on by 181 of the world's largest companies, that it should be just the stakeholders and all the stakeholders. So dealing ethically with suppliers and dealing with your employees and dealing with the communities in which they serve. Did that have... That pronouncement, did it have much effect in Europe or was there any buzz about it?
11:08 Laura Spence: A little bit, a little bit of buzz, but... Yeah, no, I don't think there were shock waves around Europe in response to that. I mean, bear in mind, there are such initiatives also across the European continent. It's not new to try to bring businesses together and to stake a claim about the perspective. The European Union has been leading on that for years, decades as well, and coincidentally, there must be something in the zeitgeist I suppose because the British Academy has been funding a project exactly around the purpose of the corporation for the last few years as well, so they've come up with eight principles. This thinking is going on all around the globe and has been. I'm up-to-speed with the European perspective, but these things will also be happening in, let me call the majority world.
12:02 Laura Spence: We talk about the developing economies but actually that's not necessarily very helpful terminology. The rest of the world, if you like, is the majority perspective, and just by listening to Europe's point of view or the US's point of view, we're just thinking about a minority point of view. And they are power issues here, that's a word that has been not enough engaged with I think from a business ethics point of view. There's power in terms of the dominant discourse, if you like, in academia, and there's power in terms of the dominance of corporate perspectives. So you talk about how many corporations have signed up to a particular initiative, and we have to remember that large firms constitute way less than 10% of any kind of measure of private sector businesses.
12:57 Laura Spence: While one individual organization might have a big impact and we can't overlook that, that's important. If we only look to those corporates to tell us what's right, we are really doing ourselves and the world and society a disservice because they are spectacularly in the minority and the numbers of people working for them is about half of the people that are employed by the private sector, employed by a private corporation.
13:29 Cindy Moehring: Let's talk about the rest of the world and the majority of the population. What needs to happen in the future to advance business ethics to the majority and to everyone who works or is affected by, let's say, the large companies in the supply chains?
13:52 Laura Spence: Well, again, draw specifically from work that I've done quite recently in India with colleagues from Bath University and Sheffield University and we've been really trying to think from the bottom, if you see what I mean and understand from the bottom. And I guess the first step is to stop talking and start listening. Quite simple? Probably a good motto for life anyway, but rather than think about how we can help the majority world and explain to them what they should be doing about business ethics. The starting point, I think, really has to be listening to what is already happening in those places and what is relevant to the actors there. So it's kind of easy to look at the sort of systems and structures that we have in place in Europe, let's say, and think, "Well, yes, we've got it all worked out. All we need to do is plonk that down in other countries and lucky them, won't they be better. Better off. And we'll have taught them. We'll have kindly taught them."
[laughter]
15:05 Cindy Moehring: We're just gonna export. It'll be so simple. Right.
15:10 Laura Spence: Yes, absolutely. That's not the way that life works. That's not a good starting point. We've tried that in the past with terrible, terrible outcomes. So the first thing is to have partners and work with people from different parts of the majority world. And of course we can't lump everything together, but... So for example, when we were looking at the textile industry in Tiruppur in India, and I would wager everybody watching this vodcast has probably got something that is in their wardrobe that's made from Tiruppur in India. Very, very high production levels and high quality production levels as well, and by going there and speaking to all the business intermediaries that are involved in being part of global supply chains in the textile industry, and rather than looking to sort of add to the kind of audit culture and be thinking, "Okay, we're looking and making judgements. We're taking our standards and our regulations with us, trying to see whether they fit or not," to start from listening to the point of view of those business people, and importantly, the workers. This is... Workers is kind of a strange thing in business ethics. So much of business ethics is directed at businesses as if all they are made up of is the board and senior managers. And if that's what constitutes business, again, that's a minority.
16:43 Cindy Moehring: It is.
16:43 Laura Spence: Powerful, but a minority. Actually, if we want to think about the business in terms of the people that work within it, it's the workers, the people doing the day-to-day business. And it's difficult to research those people, partly because you need the permission of their managers and the superiors within the business. And they're not always keen to let you speak to the workers. And even when you do speak to them, the workers themselves are thinking, "Oh, this person's been sent to me from head office or wherever. I've gotta be careful what I say." And of course, as a researcher that's not what you want, you want to be completely independent and open. So that's all of those things are tricky and difficult. And then to keep listening, to push further to understand the different perspectives in the world. Actually, something we've been doing most recently, another project relating to India is to look outside the workplace. We are so, so, so caught up with the idea of the boundary of the corporation, all the business, if we're getting outside of the corporate lens, the business itself, that we fail to really think about the business as society. No, not business in society, which is already quite radical in many respects, but business as society, and think about what's happening outside of the workplace in the first instance for those workers.
18:11 Laura Spence: If we understand... Imagine if we understand workers as whole human beings with a life outside the workplace then we start to get a very different picture and to understand what is happening in the workplace, actually we need to understand the whole life of the worker and those that are engaged with the business organization.
18:34 Cindy Moehring: Can you share some of the things that you've observed and learned in that latest research?
18:40 Laura Spence: Oh man, yes. It's been really, really enlightening to really... So in this particular case in India, and it's not all generalizable everywhere, but we do see some sort of similar reflections. We have to really think about the structural issues of society. So in the Indian context that means thinking about the paternalistic nature of society. The fact that there are particular roles for different gender that are somewhat replicated in the workplace, in the home. The women workers who are very often recruited in preference partly because they lack power and accept lower pay, and will do more menial work. Those women are the same ones that go home and look after the children, the next generation. We talk about social reproduction here and the work that women do in social reproduction. Looking after the future generation of workforce and also of course, looking after the men that may be doing quite similar work as they're more in the same factories, but don't go home and then do all the household work as well.
19:49 Laura Spence: So taking into account the work that goes on that is unpaid, this is a pretty global phenomenon. Right? And really understanding what that means for the organization within the workplace and just some very simple things like working conditions. We might also think in that work, we've really learned a lot about recruitment and migration patterns of workers. So many of the workers come from the north of India, where there's different culture, different language, different stereotypes and perspectives about what people are like from the North of India in relation to the Southern Indian workers, and there's also issues around how those people are housed. Again, we start getting outside of the workplace in order to understand what's going on within the workplace, and so we've learned a lot.
20:46 Laura Spence: We're working on a paper around hostels and how the people, often women, not only but often women that come to work in cities in Tiruppur where they are... In order to ensure their security and safety, on the one hand, they're kept in hostels, kept... That gives away this perspective, which are a form of reduction of their freedom because they are not allowed to leave the hostel without permission or without being accompanied by a manager, and so the home life, the living in the hostel becomes part of the work life and the control that is experienced in the workplace is identical to the control that's experienced in the home place. Those kinds of things are so easy to overlook when we're just thinking about what we do when we walk into a shop and buy an item of clothing. And yet now, if I walk into a shop and buy an item of clothing... Well, I haven't done, actually for months and months and months because all I can see is the faces of those often women workers and what it means in their life to produce that one t-shirt for me to buy at a ridiculously cheap price. That puts a bit of a different perspective on business ethics, I think, when you really start to understand the lives of the people that have produced the product and the raw material which we then gobble up and consume without much consideration.
22:26 Cindy Moehring: Yeah, and I think the connection of those two worlds between the end... The company that has the product at the end of the line and the worker who's working in those conditions, if you will, to produce the end product is the companies at the end of the line who seem to get it are those who have taken the time to listen, to visit, to explore those areas where the goods are being produced and engage in the local community to figure out how they can positively impact the workers' lives outside of the workplace with the recognition, I think of what exactly it is that you're saying is it is business in society or actually business as society, right. Seeing the full kind of... The bigger picture, if you will, and the full chain, and there's a huge opportunity there to engage and invest and positively impact the conditions, because working for women is good, it gives them empowerment and gives them the ability to have some self-confidence and raise their ability to contribute in the world, but there are still a lot of barriers that have to be overcome, and so bringing that lens into full focus is very important.
23:52 Cindy Moehring: Well, this has been a fabulous conversation, and I'm gonna ask you perhaps even a harder question now. Can you tell me how you would summarize what you see as the future of business ethics and business ethics education with three words or three phrases? What are the most important things that you think faculty practitioners need to hear in order to prepare students and companies, if you will, for the future of business ethics?
24:34 Laura Spence: Yeah, well, I really, honestly think this is our moment from a business ethics point of view, and if we do not get our act together and get in the game, get in the argument, roll our sleeves up, get dirty. Really, really think about the place of business ethics in business society, academia, then we have lost. We've really lost. So I think there's a huge opportunity here because very few people will say these days, business ethics isn't needed. I think we've won that battle, that game. What we need to do now is get involved. So three words, a good academic loves three words. I'd go for centrality. We have to be in the middle of the discussion. There's been lots of talk through business ethics, about being on the main... Being in the mainstream and engaging with the mainstream. That very often, I think has been a little bit of a mistake and meant trying to talk in ways which economists will listen to in order to win some kind of theoretical battle, and that's not helping from my point of view, we actually need to be at the core of the discussion. And which would bring me on to my second point, which is not being afraid, being critical. So now we need to be central, we need to be critical and daring in what we say.
26:00 Laura Spence: So like I say, so often, it's been about trying to be legitimate within a capitalist economics framework. I think the time for that has passed, we need to be a little bit more willing to say something frightening, scary, difficult, awkward, combative, if necessary. Really, really be ready to speak up. And then the next thing is urgency. I think business ethics is and should be shifting in the future to a phenomenon-driven approach. At the beginning of the year, 2020, it looked like it was gonna be kind of climate change, which was gonna do that and say, "Okay, we can't ignore climate change." Then there's the... Well, coupled will that the Me Too movement, and then Black Lives Matter and of course COVID-19. How could business ethics not be engaged with these urgently? For my three words, I'd say centrality, criticality, urgency. I personally am over sitting on the sidelines.
27:10 Cindy Moehring: That's fabulous. And I agree, 100%, it's sort of like the perfect storm moment when it's time to move through that in a productive way to get to the other side and to get to basically business ethics 3.0. And then I think your three words sum that up quite well. So let me end on a couple of just personal questions that people can use for resources or to get to know you a little bit better. So what, if you have, a book or a podcast or a video or movie you've been watching lately, we've all been spending a lot of time inside due to COVID, you may have an example from each of those categories, but what has been a release for you, something that's been fun to read, yet informative, and also, by the way, included an ethical dilemma somewhere buried in there.
28:04 Laura Spence: My goodness, yes it's everywhere. I guess I can probably give you one of everything. On the kind of visual front, the TV series, actually, that I've really, really sort of watched with fascination is a Danish TV series called Borgen. I don't know whether you see it in the States, but it's about the first... Or a depiction of the first woman prime minister in Denmark and the journey that she takes. Absolutely packed with ethical challenges and issues, very readily relatable to I think any context, including business. And then I'm a big reader of novels. So, in fact, when I came back from India and learning so much and being so personally shaken by what I'd seen in factories, I kind of was conscious, this isn't just something that happens in India, of course, and I kind of looked for literature which would translate some of that, or tell that story in western context. And so I went back a little bit historically and read Upton Sinclair's work, The Jungle. Upton Sinclair's work really, really shines a light on the terrible horrendous working conditions, particularly of migrants in the meat packing district, and lo and behold, when COVID really took off, some of the big problems were also in meat processing and packing companies.
29:38 Laura Spence: So that was really kind of moving for me, 'cause I thought here I was reading about something and thinking, well, at least, that's in the past, and it simply isn't. Here it is. And that sort of... Historical novels, but novels which open up another point of view to me, I absolutely adore and really learn a lot from. And really you never have to look far to learn about business ethics, it's always right at the end of your nose, if you're tuned in to it, so there's lots of great fun out there, but I really learn a lot from that.
30:13 Cindy Moehring: That's great. Laura, this has been an amazing conversation. Thank you so very much for your time, and I look forward to reading more about your work and your current research and keeping in touch and we can do this again in the future when we've got the next chapter to write, if you will, so thank you so much.
30:37 Laura Spence: Yeah, absolutely. See you in 20 years.
[laughter]
30:41 Cindy Moehring: Thanks Laura, it's been great.
30:43 Laura Spence: Thanks, it's my pleasure. Absolutely my pleasure. Thank you very much.
30:46 Cindy Moehring: Okay. Bye bye.
Cindy Moehring is the founder and executive chair of the Business Integrity Leadership Initiative
at the Sam M. Walton College of Business at the University of Arkansas. She recently
retired from Walmart after 20 years, where she served as senior vice president, Global
Chief Ethics Officer, and senior vice president, U.S. Chief Ethics and Compliance
Officer.
