Friday, November 14, 2014

Putting business on a guilt trip

Is the commendable label of “Homo empathicus” being abused for self-gain?

Having introduced a recent article with some history of my father, let me start this one with an anecdote about my mother. She was a formidable figure who had many weapons in her vast arsenal of persuasion and manipulation.

These were mostly simply what was conveniently at hand such as a tomato box or the flat end of a bread knife. Later I came to appreciate that what modern sissies would call abuse, was simply tough love and a reflection of both the times, and the maternal frustrations of raising four unruly siblings born soon after each other in very modest circumstances.

By far the most formidable of her WMD’s was nonviolent. It was a nuclear missile called guilt. As a devout Catholic she had a talent of pulling a guilt trip on her offspring simply with a look, raised eyebrow or feigned emotional pain. In this she outdid the prowess of ancient priests who defined the sin, the dire eternal consequences, the punishment, and the price of absolution; that conveniently could be paid to them. Or like modern day cult leaders and rogue charismatic pastors who preach the power of empathy, generosity, and charity -- all from behind the collection box.

"Homo empathicus" has been receiving some attention, including a call by our own Cooperative Governance and Traditional Affairs Minister Pravin Gordhan, supported by Cosatu (see article here) for business leaders to adopt this mantle, specifically against the background of large pay disparities. It has also become a growing feature of socio-economic discourse. Regular readers will know that I have always taken issue with exorbitant executive pay. At the same time, I have argued that apart from those builders and creators of business, who mostly have only a passing interest in wealth and profits as affirmation of their contribution, the market for executive “skills” and “talent” is thoroughly broken and remuneration criteria based on shareholder value is misplaced. Appealing to them for “charity” seems to confirm the validity of their pay, not challenge its flawed make-up.

But here's the rub. To see the term homo-empathicus as "soft" and "fluffy" or leftist and socialist is totally out-of-place. It's the same hypocrisy that I have challenged in capitalism claiming to be "market driven"... It is not... It is profit and self-gain driven which is the opposite of being market driven. An assumption that they are the same, or that the one automatically implies the other, is either disingenuous or simply naïve. Taking those motivators to extremes has been the root cause of our modern economic ills.

Homo empathicus is being expediently used in most cases to champion the plight of vested interests, in this case employees. They are clearly asking employers to adopt empathy for their (the implorer’s) self-gain. It is the ultimate insult to empathy itself -- in the same vein as using scripture to justify crimes, or insisting that someone else must act charitably towards yourself.

Business may soon find itself overwhelmed by this new rhetoric, and no doubt it will be the prelude to a plethora of "empathy" consultants to show them ways of faking it. On the other hand – and here is the real opportunity for business – they can seize the initiative and forge the genuine model which is the very foundation of service, common purpose and common fate. Empathy by its very nature is always externally focussed and in business it means everyone having empathy for the customer and society as a whole. All it requires from business is to do what should come naturally, having an external focus on the needs and wants of others in society and then serve those needs with the best product or service at the best price. Rewards in the form of wages, taxes and profits are there to sustain and grow that activity. They are not the purpose of that activity.

Inner empathy (for each other as partners in wealth creation) simply makes good business sense as long as it sticks to the fundamentals of sensible wealth distribution which means meeting the legitimate expectations of all of the stakeholders and encouraging continued contribution. But inner empathy is a means. External empathy is the purpose. Of course it is highly praiseworthy for business and the wealthy to be philanthropic and charitable to those in need. Many of them already are over and beyond the taxes they pay. It is simply inappropriate, if not obscene for the recipients of “charity” to manipulate, emotionally blackmail, or even extort their benefactors to be charitable.

Empathy is a human instinct and a state. Contribution is a behaviour that naturally follows this state. Contributory behaviour is the fundamental requirement for wealth creation, prosperity, job creation and national competitiveness. It is based on the self-evident axiom that when people by and large are giving more than they are taking, they create surpluses and prosperity. The converse creates deficits and poverty. The survival model of business, including profit and wage maximisation, has distorted this focus and has created many economic imbalances.

You cannot expect empathy from others when you yourself are not empathetic. It is a very moot point whether labour itself has been homo empathicus – especially to those who are the intended beneficiaries of their efforts: customers and society as a whole.

At the same time they have relinquished real power. Power based on threats, extortion and self-gain is seldom sustainable. Power based on empathy and contribution is far more so.

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