Global Business Citizenship: A Transformative Framework for Ethics and Sustainable Capitalism

Citation

Xu, Y. (2008), "Global Business Citizenship: A Transformative Framework for Ethics and Sustainable Capitalism", Journal of Management Development, Vol. 27 No. 8, pp. 900-902. https://doi.org/10.1108/02621710810895695

While Global Business Citizenship (GBC) is becoming increasingly topical today one may wonder where the concept of GBC originates from and what it means in practice. Bearing such questions in mind, I start reading the book Global Business Citizenship: A Transformative Framework for Ethics and Sustainable Capitalism. I wonder how Donna et al. define several key concepts they use for the title of the book, such as global business citizenship, ethic, transformative framework, or sustainable capitalism and furthermore, how the authors put these concepts into a logic framework, and critically apply them in a dynamic business world today.

To define the concept of GBC, Donna et al. describe that like individual persons can be citizens to a particular culture or polity; organizations can be corporate citizens of a particular culture or polity or global citizens within or across polities. Accordingly, global business citizen is “a business enterprise (and its managers) that responsibly exercises its rights and implements its duties to individuals, stakeholders, and societies within and across national and cultural borders.” A GBC organization is a company that thinks globally but acts locally with corresponding rights and responsibilities.

To Donna et al., the concept of ethic involves the most controversial and complex debate. A broad ethical concept concerns what “harms and benefits, voluntary versus involuntary participation, rights and duties, just processes and fair distribution”. Donna et al. argue that it is not straightforward to apply the generic ethical code to the business world because in the latter context, managers tend to act more according to what is economically best rather than ethically appropriate for the firms. What complicates the situation further is the fact that managers may find there is no code of conduct to handle the difficult dilemmas and ethical issues in their workplace. In their exploration of the concept of ethic in the real business world, Donna et al. first try to identify principles of ethical management and conduct, and then attempt to provide guidance to managers to tackle the ethical challenges of managing global business.

From the very beginning of the book, Donna et al. send a critical message through developing argument around the concept of sustainable capitalism in globalization. The authors claim that they are not following the traditional route to argue on positive and negative effect of globalization. Rather, they lead the argument to a new and perhaps more meaningful angel on how capitalism sustains its development in the every‐increasing pressure from today's complex ethical issues in firms' globalization. Donna et al. clearly state their opinion on the relationship between globalization and sustainable capitalism. They believe globalization “can yield the very best that capitalism can offer” on the condition that firms adopt the path of GBC. The practice of GBC will lead capitalism to sustainably meet its promise of wealth creation and just distribution.

While keep exploring the theoretical meaning of those key concepts, namely, GBC, ethics and sustainable capitalism, Donna et al. raise the central and practical question of the book, which is how to follow GBC approach for business ethics and sustainable capitalism. To Donna et al., a transformative framework is needed. The transformative framework should be applied concretely in practice in the process of GBC. The framework is a transformative one because it facilitates changes for transforming an organization into one where GBC is valued, designed and assessed. Donna et al. build up the transformative framework through six interrelated processes and present each main process logically as follows.

First, Donna et al. admit that the new realities of global business are presenting managers with challenges never imagined before. In chapter one and two Donna et al. describe the systems of global business become more uncertain and turbulent. Firms seem to face more threats than opportunities when they found culture differences are confusing, short‐termism is rewarded, big corporation are not trusted.

Among many uncertainties and turbulence, one crucial ethnic issue that may occur at all three levels of business, namely, individual, organizations, and economies, is the lost of trust. To strengthen trust‐based business, Donna et al. put forward the concept of global business citizenship in chapter three.

To be able to recognize that ethics and values make a difference in business is not enough. Managers must also need to realize that ethics and business co‐exist and there is no “great divide” between these two areas. Chapter four introduces the main attributes of GBC in codes of conduct constituted by the orientation, implementation and accountability of GBC.

The benefit of implementing GBC is obvious. Donna et al. believe GBC offers firms a hybrid strategy to implement ethics and values within and across borders. Earlier in chapter three, the concept of GBC is developed concerning which ethic, whose ethics should prevail, acknowledging varying degree of ethical certainties about what is right thing to do.

Although GBC is relatively a new concept, the tools for implementing it in organizations already exist. Donna et al. use six chapters to explore implementation issues. Chapter five and six explain the relationship between GBC and stakeholder engagement. Chapter seven and eight address the relationship between GBC and organizational change development. Chapter nine and ten discuss the relationship between GBC and accountability management.

At last, Donna et al. remind us the tools for implementing GBC need to be developed as well. The authors reinforce that it is important to learn to apply the existing tools of GBC to bring positive effect on changing the potential passive status of managers in dealing with challenges from globalization. The last two chapters of the book explain how companies learning play roles in achieving GBC.

Linking the above six messages, Donna et al. carefully present an original book telling the whole story from the beginning to end on management of global business ethics and sustainable development. The authors highlight companies should accept a set of basic principles first. Then managers must implement the global code of ethical conduct in all the locations. Managers also need to analyze problems in implementation as well as keep learning from errors in the process.

This book has obviously gained benefits from a combined knowledge of the four authors, providing readers with both theoretical argument and practical solutions. Various theoretical models are clearly presented with well‐organized supporting evidence. The authors committed three chapters, i.e. chapter six, eight and ten to present case studies information in order to correlate academic thinking to the practice. Case study method serves as a powerful method particularly in exploring the meaning of those concepts that are still in need of a more conclusive definition. To avoid bringing further confusions to the already complex and interrelated ethnical realities, each individual case is presented to highlight a particular issue, or a specific process or a type of organization behaviour. In doing so, a more concrete framework is established.

Overall, as other scholars and senior executives already commented, Global Business Citizenship: A Transformative Framework for Ethics and Sustainable Capitalism has offered an analytical yet practical framework for thinking about what global business citizenship is and for putting it into action. In conclusion, this book is useful, timely and easily‐read addition to an area that is rightly receiving increasing attention on the global business ethics, where theoretical‐rooted advice and practical guidance are needed.