Profit with Honor: The New Stage of Market Capitalism

by Daniel Yankelovich

Book Overview

This wise and optimistic book examines the rampant scandals that plague American corporations today and shows how companies can reverse the resulting climate of mistrust. By seizing the opportunity to... This description may be from another edition of this product.

• Format: Hardcover
• Language: English
• ISBN: 0300108583
• ISBN13: 9780300108583
• Release Date: May 2006
• Publisher: Yale University Press
• Length: 189 Pages
• Weight: 0.85 lbs.
• Dimensions: 0.8" x 5.9" x 8.5"

Customer Reviews

Should be required reading for B-school

Excellent book with great examples of how business could and should be conducted. I'm finishing b-school and I wish that this was required reading. It is inspiring to think that it just might be possible to conduct business in an ethical manner and still make money.

Lots of Stimulating Thought in a Small Book

Daniel Yankelovich is a social scientist who has also served on several corporate boards. That gives him a unique perspective on the ethical challenges that face board members. Yankelovich, to use his term, is a "privileged witness," who sees business from the outside, but has seen its inner workings up close. Even more important in some ways is the fact that he and his company have been among the firms tracking changes in society over several decades. Here is why he wrote this book: "The purpose of this short book is to suggest that the business community can turn the scandals of recent years to good use, both for business itself and for the larger society." Yankelovich sees three causes for these scandals. They are: 1) deregulation; 2) linking the biggest part of CEO compensation to stock price; and, 3) the importing of wider social norms into business, resulting in what he calls "unenlightened self-interest." In the first half of the book he outlines changes in social norms in both business in society over several decades. Business, according to Yankelovich is more likely establish the norms he desires than society as a whole. And, he thinks, if business does so it will "help dispel moral confusion in the culture at large." He says: "My main argument in the book is that the time has come for market capitalism in the United States to advance to a new stage of enlightened self-interest." To do that he advocates something he calls "Stewardship Ethics," which he defines as "commitment to care for one's institution and those it serves in a manner that responds to a higher level of expectations." He devotes the second half of the book to describing what a set of norms based on "stewardship ethics" might look like and how they might come about. In one of the most helpful sections of the book, Yankelovich spends time outlining the difference between his Stewardship Ethics and the bundle of beliefs and positions that come under the heading of "Corporate Social Responsibility." If you're like me, you'll find Yankelovich's position a refreshing change from the "profit is evil" approach of most CSR types. If you are someone who sees the pursuit of profit by companies as, at best, a necessary evil, you will be very uncomfortable with this book and its ideas. This book has two key strengths. First, Yankelovich himself is both knowledgeable and logical. Second, the book is short, only around 170 pages of text. Those are also the book's weaknesses. Because Yankelovich himself is knowledgeable, he often leaves terms undefined. I could not find a definition, for example, of one of his key terms, "market capitalism." It may be that everyone indeed defines that term the same way, but I doubt it. The shortness of the book means that some arguments are made without adequate support. For example, on page 96, Yankelovich says, "How well a company conceives and executes stewardship ethics as a community has a direct bearing on its long term profitabilit

Must Reading For Any Current Or Future CEO And Business Leader

This is a book I wish I had written. I have talked at length over the past few years about what is wrong with today's capitalist economy and particularly so since the Enron, Tyco, WorldCom, and other corporate scandals. However, I am and always have been a committed supporter of a free-market economy with minimal government interference. In the late 1950s (while very young!) I embraced Ayn Rand's "laissez-faire" theory of business, only to be later disturbed by some of the unwarranted and seriously problematic assumptions one had to make in order to completely buy into her "doctrine" of extreme individualism and "caveat emptor" economics. While I recognized that neither Communism (ala Marx) nor state socialism could bring about a dynamic market economy combined with political liberty, there was, I thought, definitely something missing in the theory and practice of a free-market economy as Rand and her coterie envisioned and promoted it. Moreover, the so-called "mixed economy" (which is what the U.S. pretty much has now -- a mixture of free-market and "socialist" elements) has not prevented the scandals recently experienced. Enter Daniel Yankelovich with his new book "Profit With Honor: The New Stage of Market Capitalism." In my opinion, on the Aristotelian scale of ethical virtue, his book represents the "mean" between the extremes of a dog-eat-dog capitalism with profit as the "only" consideration and the position that profit is evil, private enterprise is antisocial and, therefore, a centrally-planned government-run economy is the only acceptable solution. Economic activity is, of course, not fundamentally different from any other human activity, whether it be individual, social, political, or whatever. There has to be some moral foundation, some ethical framework, which justifies and provides a rational structure for the activity. Neither of the aforementioned extremes can provide the necessary theoretical support nor the practical guidelines for an economic system which must take into consideration human nature and the human condition. In his book, Yankelovich states that his "main argument . . . is that the time has come for market capitalism . . . to advance to a new stage of enlightened self-interest. American business needs to develop a new ethic -- a coherent set of social norms -- both to counteract the forces leading to the scandals and to meet the challenges of the global economy that call upon business to take on many new responsibilities." He calls his program (if that is the appropriate term) a "stewardship ethics," a set of cultural norms for business which involves social responsibility without rejecting the concepts of profit and self-interest. This is, for the most part, my position on the issue. The philosophical enemies of market capitalism have had plenty of ammunition provided to them in recent years by some of those -- dare I say "crooks"? -- who are involved in market capitalism itself. Without a solid and rational mo

Should Be In Every Boardroom

This book is about ethics and integrity in corporate America. The author discusses the various scandals of the past decade or so, looks at root causes, and proposes a solution. This book could easily have been a statist prescription for yet more regulation by that whacko entity we call the federal government (which doesn't actually govern), but fortunately it was not. Just as easily, it could have been yet another book used by the author to push the leftist agenda in the rosiest of terms, despite the fact that agenda has always failed and always will. Fortunately, we were spared that reality-challenged view as well. Nor is it another effort to push the "conservative" agenda (basically, a way of diverting money to special interests). In fact, Yankelovich stresses the need to move beyond political "solutions" to problems. People change careers, and I am one of those people. In my former life as an engineer (in a galaxy far, far away or something to that effect), one of the skills I learned was root cause analysis. This kind of analysis is demonstrably absent in public policy, as is evident from the demonstrable failure of federal policies, federal agencies, federal programs, and just about anything else spewing forth from Washington, DC. I notice that most "experts" have pretty logical-sounding solutions to what ails us, but almost none of them first determines what problem needs solving. They have a hammer (their area of expertise), and the whole world is their nail. Yankelovich takes a humbler and more rational approach. This book talks about what CEOs and other leaders should do to restore integrity in our corporations, yet in the preface he says he's neither a celebrated CEO nor an expert on the subject. Upon reading the book, I found this worked to his advantage. He's not an armchair general type, either, though. He was on many boards over many years and has seen the workings of the inner sanctum firsthand. His background as a social scientist and researcher is also a critical qualification, because he has an excellent lens through which to observe and analyze. At 169 pages in paperback format, this book is short. It's not a highly detailed academic treatise on case histories. Yankelovich is certainly capable of producing such an opus. But it would be read by academics rather than CEOs. This book is the perfect size for its primary target audience--the high level corporate executive. It can fit into a briefcase for reading during a return flight or two. Profit with Honor has ten chapters. The first two give us a clear picture of the problem. In those chapters, Yankelovich also discusses why legal remedies don't work. For example, if you have a law barring a certain behavior, people who believe it's OK to game the system will find and exploit a loophole. To see how this pans out, look no further than our insane, and counterproductive, federal income tax code. He also talks about what happens when a company promises to play nice and then do