Business and Social Responsibility:
An Interview with Willis Harman
By Scott London
As one of the world's leading futurists, Willis Harman belonged to a handful of forward-looking thinkers and practitioners exploring a new role for business in creating a more prosperous and sustainable future.
Harman believed that we're living in a period of accelerating social and cultural change, one marked by economic globalization, spreading democratization, quickening technological advance, and burgeoning global communication. But in the midst of all this change, we're also faced with a host of unprecedented global challenges, from the population explosion and the depletion of the earth's natural resources to a deepening divide between the world's rich and poor.
In Harman's view, many of the these problems stem from unquestioned economic assumptions that need to be brought into the open and reevaluated. One example is the notion that sustained economic growth is the only path to human progress. Another is the idea that economic competition strengthens efficiency and ultimately favors consumers.
As Harman pointed out in The New Business of Business, a book he co-edited with Maya Porter, there is a new business ethic emerging today, one based on the ideas of stewardship and social responsibility.
The primary proponents of this ethic are creative business thinkers and innovative entrepreneurs motivated not by idealism or goodwill so much as the recognition that the fundamental ways of modern society no longer work.
They recognize, in Harman and Porter's forumation, that "present economic, corporate, and social policies are, by and large, inconsistent with viable long-term global development, and are being made without a picture of a satisfactory global future in mind."
I sat down with Willis Harman shortly after the publication of The New Business of Business to explore what he sees as the new role and responsibility of business today. We met at his office at the Institute of Noetic Sciences in Sausalito, California. He served as president of the organization for some twenty years. It turned out to be one of his final interviews. He died in January 1997 after a brief illness.
Scott London: You've said that "it's not improbable that the near future will see some breakdown in the world economic system."
Willis Harman: Yes, it's becoming apparent that problems are being generated in such a way that they seem to get worse year by year. And they seem to be more fundamental and more interconnected than they were a half-century ago.
London: A point you often make is that many of the troubles we see today are the result not of our failures, but of our successes.
Harman: Yes, I think that's true. We've developed an ability to control — through technologies, power, and management — almost anything that you can point to. But, at the same time, we lack a good sense of values to guide it. At a fundamental level, it's being guided by economic values and the financial bottom-line.
For example, look at the kinds of organisms that exist on planet Earth. Evolution may account for the diversity of organisms that exists today. But as we look ahead, the decisions about what organisms will continue to exist on the planet are being brought about not by the process of evolution but by biotechnology. And what guides biotechnology? The economy. The organisms that are good for the economy will last, and the ones that aren't good for the economy will disappear.
That's not leading toward sustainability, if you know anything at all about ecosystems. And so we're in a kind of situation where our power has been growing and growing, while at the same time our wisdom has had its limits.
London: In your latest book, you say that one of the guiding assumptions governing our economy is that "the business of business is business." How do we go beyond that to seeing the economy as the means to something else, such as the advancement of knowledge or the fulfillment of our highest capacities? How do we begin to define broader social goals when everything is driven by the bottom line?
Harman: First of all, we have to recognize that modern society is based on a whole set of assumptions. Some of them are the assumptions of science, the assumptions underlying the economy, and so on. Those assumptions are part of the culture, so we all buy into that belief system. Now, among our assumptions is an assumption that the economy is properly the dominant institution, and that economic logic and economic values should have more power than almost anything else. Another assumption is that the primary function of a business organization is to provide the optimum financial rewards to the investors. Because of this, anybody in big business who tries to operate in a way that takes other values into account ultimately gets squeezed out by financial bottom-line considerations — not because those individuals have faulty characters, but because everything is dominated by a belief system into which we have been buying all of our lives. So we are the ones — not the top-level executives — who have to start saying, "We have to reassess those assumptions."
When we look realistically at the amount of land around the world turning to desert each year, the amount of land that's being poisoned one way or another, the chemicals that are used for agriculture, the increasing gap between the rich and the poor, the increasing concentration of riches in the hands of the few and how that's built right into the system, etc. — when you look at all of this, you say, "That cannot last for a whole lot longer." How do we get at the roots of that? Well, if you look long enough, you'll find that the roots are in the belief systems in our heads.
London: By extension, then, things should begin to change as people start to change and question their own assumptions.
Harman: There are certainly long-term forces that suggest, at least in the long-term, it's all got to change, and the role of business has to be different. The role of business has to be one that shares in the total responsibility of the planet. It may take many decades for that sort of change to happen. But there are many, many areas in which there could be a severe crisis of one sort or another that would cause people to feel jolted and say, "We'd better reassess things a whole lot faster." This could a very severe environmental disaster or a severe financial situation. For example, the debt structure around the world might bring about something like this. And another likely place is the whole currency and gambling system around the world.
London: Do you mean the stock market?
Harman: The stock market and its derivatives in all sorts of other things. 25 or 30 years ago, international exchanges of currency were almost entirely related to goods and services. In other words, the global economy was about what we used to call trade. Now the global economy is over 97 percent speculation in one name or another. Only about 2.5 percent of the exchanges have anything to do with goods or services or anything that is directly related to the well-being of human beings. The Berings Bank went down because of this kind of speculation. The Japanese economy was severely hit by an earthquake, and somebody made a bad guess — and out went the bank in London. That could happen on a large scale.
London: You mentioned currency speculation. From what I understand, this is a fairly new development tied to the fact that the value of money is no longer determined by gold and silver.
Harman: In the early 1970s, all of the major currencies of the world shifted from being based on gold and silver to being debt-based — money borrowed into existence from national banks. What on Earth does this mean, that the total nature of currency shifted? Nobody voted on it, it just happened. Nobody has thought through what the consequences of that might be. I think one of the consequences is that the whole international currency system is very precarious now. That doesn't mean that I'm predicting it will collapse next year, or ten years from now or next week. But it is much more possible now than it might have been before.
London: You said "nobody voted on it, it just happened." Business has become the dominant institution on the planet today, in many cases even more important than government. Yet government supposedly represents the people, whereas business does not. Does this concern you?
Harman: Well, there are various creative trends that are taking place too. Management in business is becoming far more participative. One writer, Peter Block, has even talked about the new stewardship role of business. He's talked about how this really is a revolution. But it's a revolution that is being carried out with the willing participation of the people who are giving away their own power. They are making management more participative. The management at the top has less power because that is better for the financial bottom line. It is better because of some of the cultural changes that are taking place, and because there are more demands for that sort of thing.
All of the institutions in society are feeling pressure to become more participative. What that is going to mean is that we will not look to the external experts, to institutions, and to governments to save us anymore. That is becoming increasingly apparent. When it comes to the really big issues, Washington doesn't even talk about them in a campaign year. They talk about little things. And yet, these issues are being talked about and world-wide conferences are being put together. Who put together the U.N. conference on habitat or the state of women or the state of the environment? They were not initiated by governments. They were initiated by non-governmental organizations and other groups of ordinary citizens. There is a new kind of global civil society that is emerging very quietly. But it's the only place where you hear these long-range, deep-level issues really being talked about.
London: The answer, perhaps, is not to go the policy route — that is, for government to regulate business and set up controls.
Harman: Governments are so influenced by business anyway. Who could possibly expect government to oversee business as though they were separate. They're not separate.
London: This is an important point you're making, because critics of big business often look to government coercion and regulation as the answer.
Harman: That's not to say that there should not be regulation frameworks put into place. But the only way they will ever work is if they are supported by a strong "third" sector — which is getting to be the more creative sector, the sector that is really bringing in the innovations.
London: You wrote a book called Creative Work and have thought a lot about how work-roles are changing. What are your thoughts about the future of work, given the economic forces you're talking about?
Harman: I think in our present situation there are lot of dilemmas, and they tend to be interconnected. The one that we find the most difficult to talk about is the dilemma of work, jobs, and everything that ties into that.
We all have a desire to create — not just create things, but do creative work. It is part of our whole life pattern. How can I make my life really meaningful? That is important to everybody. Now, to accept the premise that the only way I can make my life even quasi-meaningful is to get a job in the dominant economy, then that leads to the proposition that the only way we can continue to have this society hold together at all is to keep the economy growing exponentially with time. So even though we keep on increasing productivity, we still keep on increasing the number of jobs, in order to give everybody a job. Now, some of those jobs turn out to be not too terribly meaningful, but they nevertheless arise out of desperation, as in: "I've got to have a job."
Well, more and more people are asking, "How do I really want to spend my life?" You find more and more people who are saying, "I'm going to do what I feel is really important. And, somehow or other, around the fringes of the economy, I'll find a way to support myself. But I'm not going to just do a meaningless job in the production, sale, marketing, and consumption of things. I just can't do that. That doesn't fit with my understanding of what meaningful life really is."
London: It's getting harder and harder to do that.
Harman: It's a tough situation because things are so structured that you can't live off a small piece of land anymore, the way people used to live off family farms. It's very difficult to get what you need to keep a reasonable style of life going. But If I go back a quarter of a century, there were only a few faint voices that were saying that we have to take another look at that. Now, there are many more voices. And that will continue to increase, I think.
London: Do you see any creative responses to that?
Harman: I think there are lot of experiments going on, such as alternative economies. With local currencies and alternative kinds of communities, people can more or less take care of themselves in such a way that they don't have to buy into the global economy.
London: Can you give me an example?
Harman: There is a town of Kootenay on Vancouver Island in British Columbia. Some years ago, British Columbia was in a relatively depressed state. Forestry was down, mining was down, and so on. The people in this town said, "Well, here we are, we can't do anything because we don't have money; but, at the same time, we've got people who want things done, people who want creative work and want to get involved with doing something; so, why don't we set up an alternative economy." So they set up a computerized bartering system. Now if someone wants a house painted, they may have to pay $20 Canadian dollars for a little paint and maybe $200 of the local Green Dollars for the labor. But those Green Dollars circulate only within the community and are no good anywhere else. But they will buy you dental services, or whatever it is that you need.
It turns out that there is another big advantage to this. There are very negative things that happen in society when you have money that is essentially debt-based and is carrying interest. The good thing about the Green Dollars is that they are an essentially zero-interest currency. When you have high interest rates in a society and a high expected rate of return, you then "discount" the future — make all of your decisions with a strong emphasis toward the present. And that leads to a very bad decision regarding the environment and the future of our communities.
So, these alternative economies with alternative currencies are being tried all around the world. And they're being tried fairly successfully.
London: Will these alternative economies be able to survive given the pressures of the global economy?
Harman: Don't forget that they are only a small part of a lot of other kinds of rethinking and experimenting going on. It's not all economic.
There is a fundamental problem here: there is no shortage in this country, or in the world, of things that are worth doing — things that are really worth doing because they will contribute to local communities and to humanity in general. But we are short of things worth doing that will make a high-level financial return for some group of stock holders. That is what we are short of.
What this really amounts to is a whole shift in values, a reassessment of the power of stockholders to control what a company does, a reassessment of whether we really want to invest ourselves and our society into one big national and global economy, or whether some alternatives have a lot to be said for them.
There are a lot of questions that are worth asking. And they are being asked in limited circles. But they will be asked more and more as we get deeply into this. Exactly where it will come out, I don't know. But if you have any trust at all in human creative abilities, what you need to do is to look around and seek out some of the experiments and some of the rethinking that's going on. And ask yourself with a fresh view: "Does where we are really make sense?" "Should we be looking in a new way at community?" "Should we be looking in a new way at whether the world should be dominated by a global currency?" And so on.
London: You are the co-founder of the World Business Academy. What sort of work is the organization involved in?
Harman: If business is eventually going to have to share responsibility in a way that is not part of the old business tradition, then one of the things that would be useful right now would be a network of people who are in business who are already are beginning to think about this question. They may feel lonesome because they don't have very many people that they can discuss these things with. And so the function of the World Business Academy is to be a network of people around the globe who are already raising this question about the future role of business on this planet. They are also raising other questions related to the nature of the business organization. That's an even more active dialogue.
London: Any specific examples?
Harman: One of most interesting companies in this country is the Rouse Company, which developed the town of Columbia, Maryland, and a number of other Eastern seaboard cities. When Jim Rouse, the founder, was managing this company, they said — and you could tell by talking to the people in the company that they really meant it — that the number one goal of that company was to provide meaningful and fulfilling work opportunities for people. The number two goal was to do something that was good for the society. (In their particular case, it was to be certain kinds of creative land development.) The number three goal was to do those first two goals well enough so that they would automatically make a profit and stay in business. That strikes me as the kind of corporation I would look towards seeing in year 2020.
There are other examples of corporations that are employee-owned and employee-managed. And again, that is something that I would expect to see more of in a couple of decades. So, it's clear that these kinds of conversations have been going on, and they are increasing.
London: Some people fear that we might not be around in the year 2020.
Harman: If we don't raise some of these taboo questions, if we don't engage in some of these constructive dialogues together, if we don't re-examine the belief system that is generating the very reasons that might cause us not to be around in 2020, that certainly is one of the scenarios. There is no question about that. That's why some of us feel so passionate about the importance of having dialogues about the very things we have been told are not to be talked about in business.
London: Are you optimistic as you look to the future?
Harman: My meaning for the word optimism is: a positive choice as to where you are going to invest your life. Where are you going to put your efforts? In that sense, I see a lot of people saying: "I don't know what the outcome is going to be, but I'm going to put my efforts toward a creative outcome." And that group is expanding. I'm sure it will continue to spread. Let's make the process as smooth as we can and with as little misery as possible.
This interview was adapted from the radio series "Insight & Outlook," hosted by Scott London. It also appeared in Deep Planet magazine.