People First PLC

Ben Andradi and Stratford Caldecott

GK Chesterton Centre for Faith and Culture,

CONFERENCE REPORT "People First PLC" by Ben Andradi and Stratford Caldecott (Published in The Tablet on 07/02/2004)

Businesses badly need values. Can Catholic social teaching supply them? Company directors meeting recently at Worth Abbey believe so.

How do leaders of large global businesses who are also Catholics make sense of their world of work in the light of their faith? How can they integrate their faith and their work experience? Can Catholic social teaching actually be applied to the way modern businesses and organisations work? These were the key questions behind a con- ference organised by business leaders and bishops at Worth Abbey in West Sussex last month.

"Leadership as if Faith Mattered" was convened by the Bishop of Arundel and Brighton, Kieran Conry, who sits on the bishops’ World of Work committee, and hosted by the Abbot of Worth,Christopher Jamison OSB. Abbot Christopher, who believes the ancient Rule of St Benedict is a rich source of inspiration for the modern manager, led the regular sessions oflectio divina – readings of Scripture in the monastic tradition.

The first speaker was Sr Helen Alford OP from the Angelicum University in Rome, co-author with Michael J. Naughton of Managing as if Faith Mattered. She drew on the idea of the "Level 5" executive who transcends mere leadership, an idea developed by Jim Collins ( The "Level 5" executive, the one who makes his or her company "great", is humble yet fearless; he takes responsibility for the mistakes of the company but not its successes, attributing those to others or to luck. He or she normally grows up within the com- pany instead of being headhunted from outside. He or she genuinely puts the company first, in other words, and does not simply make use of it to further personal ends.

Such a manager plays something of a Christ-like role within the company, at least relative to the other members of the business. This is a leader who takes the company’s "sins" on himself and transforms them for the good of the company ("redemption"). Sr Helen went on to explore the concept of the "virtuous" manager, and the relationship between ethics and success in a fallen world. From a Catholic ethical perspective, it is important for both ends and means to be virtuous. Is the product serving the common good? Is it being produced in a way that furthers the common good?

In the Catholic social tradition human beings are not means to an end, but ends in themselves. They are "persons", a term derived from Trinitarian theology which speaks of God as one substance but three persons. Persons are not just individuals but constituted in part by their relationships to others; persons working together in a company do not create a machine but a community. The "common good" is the nexus or fruit of these relationships within a community. Thus the "Level 5" executive is the one who is serving the common good of the company and the wider community, Sr Helen concluded.

Arie de Geus, the former head of group planning for the Royal Dutch/Shell Group and author of the bestseller The Living Company, reported that a Shell survey had discov- ered a total of 27 companies in the world that have sur- vived for more than 150 years (in one case, for as many as 700 years). All these companies that had stood the test of time shared four characteristics. First, they were all conservative in financing (they preferred money in the pocket). Second, they were outward-looking, sensitive to and engaged with the world around them. Third, they had a sense of cohesion and company identity, with clear values, aims, and principles; and saw their organisation as a "living community". Lastly, their leaders were "tolerant" – delegating authority and leaving space for others to flourish, without losing control.

Most existing companies are not like this, and survive for decades, at best, rather than centuries. Research, in fact, shows that the average lifespan of companies is in steep decline, de Geus noted.

His conclusion was radical: business schools and conventional economics are killing companies by defining their purpose as the "maximisation of shareholder value" – increasing the price of product that the market will stand in relation to cost in terms of land, labour and capital. He reinforced this by reference to research by Jim Collins reported in another book, Built to Last, which showed that companies which do not put profit at the top of their list of priorities were actually 15 times more profitable over a 16-year period than companies which did. Profit, he concluded, should be regarded much like oxygen: as necessary for life, but not the reason for which we are living. The second chapter of St Benedict’s Rule, quoting Matthew 6:33, agrees: "Strive first for the Kingdom of God and his righteousness, and all these things will given to you as well."

De Geus is not a Catholic, but he sees the Catholic Church as a natural ally in his campaign for the revision of company law. Since the nineteenth century shareholders have had the power because they supply the capital. But this is no longer a world of scarce capital, he said, and so the maximisation of capital should no longer be the criterion of success. The more important criteria should be the flourishing of the people in the business – their talent, loyalty, creativity and so on – as well as the quality of the product. In the long run this reorientation of business to People First PLC Ben Andradi and Stratford Caldecott GK Chesterton Centre for Faith and Culture, Oxford 2 put "human capital" at the centre should ensure a more sustainable economic system, he argued.

The third main speaker was the young chairman of Bren- ninkmeijer Family Enterprises which owns the C&A textile giant. Catholic social teaching, saidMaurice Brennink- meijer, is "the only coherent, holistic, integrated frame- work for viewing the quality of man’s relationships with his world". It can be used to identify both how the world ought to be and how to get there. The "servant-leader" model helps others move up the pyramid: from a concern with mere survival, to assuredness, communication, recognition/prestige and creativity – a pyramid roughly equivalent to Collins’s five levels.

Brenninkmeijer had good advice of his own. The central values in business should be Trust and Truth, he said. While virtuous companies value profitability, they value other things more. The goal of good leadership is to "kindle the soft flame of wanting to be better"; to be virtu- ous was to "act as though one loved". Faith was a source of strength in learning to love. And he quoted former President Harry S. Truman: "There is no limit to what you can achieve provided you don’t mind who gets the credit." This meeting of high-level business executives was im- pressive in its radicalism. They saw business as a vocation and their leadership roles as a great calling. Far from aligning with the conventional wisdom of the business schools, they were attempting to bring the humanistic and personalistic principles of their faith to bear on the way they did business. They saw the need of these principles more than ever in the current world of business, shaken and unsure in the wake of the Enron and Parmalat scan- dals. Fat-cat salaries, lack of integrity and trust in business had tarnished the image of business, and had led to prestigious management journals asking themselves what businesses are for. This is the time, in other words, for Christians to provide some unique insights and leadership in this area. We are already planning another conference for next year.

Ben Andradi is CEO of a European technology company. Stratford Caldecott is director of the Chesterton Institute for Faith and Culture in Oxford. For details of future conferences email [email protected].

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