Author: Ken McPhail
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Businesses are both saints and sinners. Give me an issue of current political, social, and environmental significance and I'll show you how the private sector is implicated, both in the problem and in its solution.
The freedom to form companies and innovate has delivered truly transformational social breakthroughs, whether that's Bell Laboratories' transistor or Pfizer's Covid vaccine. But history is also full of examples of businesses and their leaders, that have done the wrong thing, whether that be exploiting minerals and natural resources, or exploiting people. Today we expect all companies to behave in a socially responsible as well as a financially responsible way. However, either by design or through lack of skills, many businesses can get caught up in unethical behaviour. For big business, this can often be because their supply chains are so complex, extensive, and difficult to manage.
The role of business in human rights
Assuming that we don't need to worry about these big issues, because government will regulate for them, is no longer tenable. The old separation between the private interests of companies and the public interests of society, that has informed much of our business and management theories, just doesn't apply anymore. Half of the largest 100 economies in the world are not actually states, they are private companies that operate across many countries with different and often weak regulatory environments. Understandably, there is a growing expectation that these big global names should be leading the way when setting the new rules of globalisation. Business has a large role in filling governance gaps and influencing government behaviour, but also in determining an individual's lived experience of human rights too.
Business and human rights, as a new way of thinking about corporate social responsibility, has grown significantly since the United Nations formally endorsed the 'Guiding Principles' in 2011. These Principles are based on three key pillars:
- Protect: re-affirming that nation states are the primary duty-bearers under international human rights law
- Respect: stipulating that corporations have a responsibility to respect rights that is independent of the state's obligations
- Remedy: stressing the need for both judicial and non-judicial access to remedy where rights have been violated
Whether addressing labour practices in global manufacturing or agricultural supply chains, security practices in mining operations, or measures to combat political disinformation online, businesses face a range of daunting human rights challenges. While on the other hand, many new companies are being formed with a mission to solving our most pressing human and environmental rights challenges. The Business and Sustainable Development Commission for example estimated opportunities of around US$12 trillion a year by 2030 in pursuing Sustainable Development Goals relating to food and agriculture, cities, energy and materials, and health and well-being.
Role of business schools
Business schools have a responsivity to ensure that graduates are ready for the challenges that they will face. We have a role in shaping their values and motivations, and ultimately their contribution to broader society as well as business. Many of our graduates will be leaders, many of them will be CEOs, and many of them will start their own businesses as entrepreneurs. They will want to do good, and to genuinely be good.
Business schools therefore have a fundamental role to play in developing future leaders with the capacity to understand the new challenges and opportunities for businesses of all sizes. Today, we live in a world with different kinds of expectations from workers, consumers, the international environment and, importantly, investors.
We must enable students to see that the businesses they work with or that they set up can be a force for good, we need to empower them to go and develop the next generation of responsible businesses that will have positive social impact, and which are also financially sustainable.
We need to ensure that business schools evolve as quickly as businesses are changing to meet these challenges.
In fact, an increasing number of business schools are responding to the challenges that human rights issues pose for corporate operations. Through research, business scholars are advancing our understanding of how corporate models affect human rights. And through classroom and experiential learning, future corporate executives are practicing managing human rights scenarios in the safety of the academic environment. Some business schools have already begun to integrate a human rights perspective into business education by creating specific human rights programmes, classes, and initiatives. See for example, the Global Business School Network Business and Human Rights Impact Community.
Manchester tradition
The city of Manchester has a huge tradition in being radical and doing things differently, so it is well-placed to address these subjects. You can see the Manchester spirit in the women's rights movement, the suffragettes, in its history of labour movements, and in relation to the cooperative movement. That spirit also seeps into the institution of The University of Manchester and strikes at the heart of the core purpose of universities, which at some level must be about both advancing our understanding of the human condition and through creativity and action seeking to make that condition richer.
As relatively new additions to universities, business schools need to look beyond the narrow assumptions about human beings that have informed our understanding of the purpose of business in society, along with how they should be run and how we measure their success. Yet, I believe we need to do this because business schools, more than any other discipline area in the university, have the power to impact people's lives both for good and for bad.
About the author
Ken McPhail is Chair of Accounting at Alliance Manchester Business School, UK.
He is a former Vice Dean for Social Responsibility within the Faculty of Humanities at The University of Manchester, UK and Director of Research and Deputy Head of Alliance Manchester Business School.
Ken also founded the Business & Human Rights Catalyst at Alliance Manchester Business School, UK.
About Manchester University
In April 2021, the Times Higher Education Impact Rankings named Manchester University as the world's number one institution for action taken towards the United Nations Sustainable Development Goals.
The Alliance Manchester Business School has one of the best MBA programmes in the world according to the Financial Times Global MBA ranking in 2021.