Research and Teaching on Social Issues: Some Accomplishments and Future Challenges

The challenge that we in the Social Issues in Management (SIM) Division of the Academy of Management have undertaken is to critically examine the suitability of the actions and policies of business managers, organizations (mostly business firms), and the free market system itself. The scope of our inquiries covers ethics, governance of organizations, and stakeholders. The principal questions that we raise are as follows: When and how do business managers, business firms, and the market system benefit people? When and how do business managers, business firms, and the market system harm people? The informed responses to these questions are of immense importance to all citizens.

Since its inception 40 years ago, SIM has given birth to numerous other divisions of the Academy of Management. Among these other divisions are Gender and Diversity; Organizations and the Natural Environment; International Management; Management, Spirituality and Religion; Public and Nonprofit Management; and Critical Management Studies. We are the grandparent that generated all of the above domains, and we still consider their area legitimate for our own inquiries, also. Hence, it is not useful to overly narrow our domain.

We note some successes during the past generation. With regard to the market system, some grass roots approaches have developed that aid industrious people at the bottom of the pyramid. Micro lending helps very poor people who otherwise would not have an opportunity to pull themselves and their families out of poverty. These successes are in spite of the invasion of some banks which charge predatory interest, and new found fraud in the claims of a minority of potential borrowers. Similarly, eBay is a success, as it enables crafts people and small businesses from developing countries to sell directly to consumers in wealthy countries. They thus have access to customers without paying the middleman.

We have also examined failures of business managers, business firms, and the market system. Moreover, we have suggested remedies for those failures. However, one might ask, Have we been too timid in our critiques? Are we in SIM too afraid of being labeled radicals? Is that the reason that the Critical Issues in Management broke off to form their own division? To fulfill our responsibility, it is important that we in SIM first do our research and then name the fraud, selfishness, and short-sightedness that we discover.

In the last few years, we have witnessed many examples of illegal and unethical activities in our financial services industry. We observed how recent Wall Street inventions, such as derivatives, futures, and collateralized loans, have been abused. We witness private equity firms which have little interest in a firm’s services, products, or jobs; they are primarily focused on selling that firm at a higher price than that for which they purchased it. One questions the real value added of such transactions.

Such activities in the financial industry have produced individuals with wealth in the billions of dollars. One of these wealthy individuals is the legendary George Soros, whom Forbes ranks as #16 in net worth, at US$24.5 billion. ¹ In spite of his own personal financial gains, Soros is critical of our free-wheeling financial system. He says that “the global financial markets are beyond the control of either national or international authorities.” And in an even more all embracing indictment, he says that the “global capitalist system [is] unsound and unsustainable” (Soros, 1998, p. xxvi). His words challenge us to further investigate the market system and to suggest alternatives and remedies for its defects.

Among the reasons that Soros finds the current U.S. version of capitalism faulty is market speculation that resulted in the loss of jobs, homes, pensions, and caused health problems and family collapse. In spite of his own outsized compensation, he raises the question of the disparity in income between the few very rich and the poor. Is this gap in income and resources appropriate and just?

In the future, will our research and writing help our students and our world? Some of the challenging issues that will increasingly face all citizens are (a) the growing influence of the global corporation, (b) global climate change and the negative environmental impact of our lifestyles, and (c) the moral maturity or lack thereof of contemporary decision makers and citizens.

Corporations have an immense influence on the nations of the world. Lobbying has grown at an exponential rate in the last few decades. Much lobbying contributes to more intelligent and effective legislation. However, some lobbying is little more than bribery. Firms pay for access to politicians and contribute heavily to their campaigns for office. This influence is made easier by the recent U.S. Supreme Court decision that allows corporations to have the same “free speech” rights as a person, and thus enables a firm to contribute to political parties and to candidates (Citizens United v. Federal Election Commission, 2010). Also showing the influence of business, many suggest that our invasion of Iraq was to secure a supply of low cost petroleum to fuel our economy. Yet the cost of such military interventions is not factored into the cost of petroleum.

China is building roads, airports, schools, and health clinics for people in Africa and other poor countries around the globe. This is the same strategy that the United States and European nations used in the last century to purchase friends and resources. These initiatives help poor peoples, but they also have a large impact on local cultures and enable China to gain access to scarce minerals and petroleum that are needed for China’s economic growth.

Global climate change and related environmental problems are becoming more serious. We share this concern with another Academy of Management division, Organizations and the Natural Environment (ONE). But the impact of environmental degradation is also within our area of responsibility. Environmental degradation is one of the most serious problems that face people of our ever smaller planet, so it challenges us to examine our lifestyles and the carbon footprint of our actions. This problem raises issues such as the long-term sustainability of big box retailers and, closer to home, our own personal air and auto travel.

A third major issue that deserves our examination is personal moral maturity. A generation ago one could not use the word ethics in most U.S. classrooms; it was considered to be uncertain, coercive, and so personal that it could not be taught or researched. But we have learned much since that time. We are now able to research and teach the development of good moral habits (virtues) and character. It comes as a surprise to many students and citizens that there are levels of moral development (Kohlberg, 1973; Weber, 1991), and that some of us are not well developed morally. These findings demonstrate progress in our field, and also provide a foundation for further research. For students whom we teach, the possibility that they are “morally immature” provokes healthy reflection and soul searching.

In sum, we have a unique and priceless opportunity to help renew business education for the sake of our students, businesses, and our world.