Business ethics can be good for a company’s brand and its image, but can also help to boost profits. This is a bigger step forward than what one might be led to believe. A business exists in order make a profit and pay wages, to generate welfare and perhaps even social wellbeing, but it’s not so easy to understand the importance of corporate social responsibility (and its ethical aspects) and to put it into practice, particularly in terms of how it can actually improve a company’s financial performance. The conclusion to be reached, then, is that ethics and profits don’t counteract each other, but rather actually help one another.

A book by Alessandro Spizzo, which recently appeared in the Nuovi pensieri collection of Libreriauniversitaria.it Edizioni, can help us to understand these issues better. In roughly 160 pages of straightforward prose, Gli effetti dell’etica sul brand (literally: The effects of ethics on the brand) is clearly divided into three parts. First of all, there is a discussion of the changing times in business and on the rising emphasis on the ethical aspects of marketing (including cause-related marketing, which seeks to unite a company’s financial needs with the needs of society), followed by a closer look at corporate social responsibility (CSR), both inside and out. Spizzo goes beyond the mere theory to also provide tips for the actual management of CSR, offering up a real-world example in the form of Ferrino & C. S.p.A., a leader in the sports equipment industry. 

In order to better understand that business ethics and corporate social responsibility are not just the latest trend, Spizzo also constructs a timeline of the major milestones of the evolution of these concepts. He begins in the early 19th century with the example the New Lanark cotton mill, which Robert Owen made into a model of business ethics. In 1819, his efforts led to the United Kingdom approving its first legislation limiting how much women and children could work in factories. 

One early passage of Spizzo’s work is particularly interesting, where he writes, “The adoption of social responsibility becomes interesting and actually achievable when it proves to be convenient, in the original Latin meaning of the term, i.e. from ‘convene’: to come together in the same place for a common purpose. In this ‘harmonious encounter’, there is an alignment of the business goals of profits and competitiveness with the goals of society.” 

A read of Gli effetti dell’etica sul brand would be a good practice for us all.

Gli effetti dell’etica sul brand

Alessandro Spizzo

Libreriauniversitaria.it Edizioni

“The productive efficiency of a company, that which aims to assess its development not only on financial parameters, but also human and social ones, is becoming increasingly good at giving value to the professional, spiritual and other individual skills, capabilities and creativity of that company’s employees. Thus, the primary factor in productivity, more important that profits and capital, is the people at work and the value given to the environment around them, especially family and the community.” This is not a view of business, of the entrepreneur or of the workforce out of a modern textbook on business management, but rather that of Cesare Nosiglia, the Archbishop of Turin, a view he expressed in early July during an address to small-business owners for an event organised by API Torino, the association of small and medium enterprise in one of Italy’s most exploited areas industrially speaking.

It is a view that well represents the Catholic Church’s current interpretation of the link between production and the economy, enterprise and social wellbeing, capital and employment, and which shows a different take on concepts such as corporate social responsibility, the actions of a business within a given social context, the role of the worker, and organisational conflict.

Entitled Etica, imprese, società e benessere (Ethics, enterprise, society and wellbeing), this address by Nosiglia doesn’t give preferential treatment to anyone, but rather speaks of a “generational pact” for coming out of the current crisis, one which brings together institutions, young people, business, and other cultural forces. In Nosiglia’s words, “The current economic challenges point to difficulties to come and which are to be considered with care and dealt with through astute strategy, one which brings together the forces of culture (i.e. education), business, politics, and society in managing this period with wisdom and a spirit of solidarity with a view toward a social and generational pact that looks to the future of our territory and which values businesses that, despite it all, are managing to survive and are seeking new market outlets for dealing with these difficult times.”

In other words, together we can survive the crisis – not together in spirit alone, but rather looking towards a new culture of enterprise and of work with particular emphasis on the needs of capital, of the workers, and of society as a whole, and, as the Archbishop explained, the Church has a great responsibility as an institution made up of individual “Christian entrepreneurs”, who he calls upon to act as such, including in business.

As Nosiglia said, “We need to weigh the fact that the workplace, production, the laws of economics and of the marketplace come with a series of challenges, which may, at times, appear insurmountable and which, in any event, create tension, conflict and injustice.” This is a critical, if delicate, passage with the Archbishop of Turin says must be met with the help not only of religion, but also of the aspects of ethics that “each of us feels within ourselves as individuals”.

Thus, the ethics of business and profits end up tying in with those of Christianity and society. This is nothing new, but now it features an important element, underscored by the Archbishop and which may be clearer now than it once was, i.e. that challenges are overcome through the commitment of us all, Christians and non-Christians, business leaders and the workers.

A read of Nosiglia’s address can raise many questions as to how to act within society and in business and may cast doubts on existing paradigms – a read that would be good for us all.

“Etica, imprese, società e benessere”

An address by the Archbishop of Turin, Monsignor Cesare Nosiglia

Turin, 2 July 2014

Seeing industry as a public service. Seeing enterprise as a conquest for all. In these complex times in which our economy and society are currently experiencing, concepts like this may appear, at the very least, anachronistic or unrealistic (dreamlike, even). In actual fact, however, the recovery of manufacturing, the best examples of such manufacturing, and a serious, pragmatic outlook on development may also come through concepts such as these. Fresh air to be shared with all. Air that is in tune with the times and yet not new. In fact, Adriano Olivetti had already sought to spread this air to many and to lend it special charm and depth, and a reborn Edizioni di Comunità have recently begun republishing all of his writings. 

Le fabbriche del bene (literally: The factories of good), a book that can be read in a single sitting, is a collection of two of Olivetti’s most important works. The first is an overview of the “Community” project and Olivetti’s idea – rooted in the factory – of civil coexistence, while the second (Dovete conoscere i fini del vostro lavoro – literally: “You need to know the purpose of your work”) is a speech given in June 1945 to Olivetti workers immediately following Italy’s Liberation. In both, we find a wealth of ideas, concepts and suggestions that would appear today to be provocative and unique, the inspiration for modern forms of organisation and management that remain difficult to find in any complete sense. 

“Any important company, because of its technical problems and the basic needs of its employees, results in constant conflicts of interest with the environment in which it operates,” Olivetti writes in the first section of the book, before adding, “Actually, the common good in industry is a complex function of: the direct, individual interests of those involved in the work; their indirect spiritual, social and solidarity-based interests; the interests of the surrounding environment, which draws its reason for being and for development from the progression of industry; and the interests of the immediately outlying territory.” All of this is by way of saying that the only possible solution for wellbeing and progress lies in “the balance between the forces behind the interests described”, and this is a conclusion that applies to this day and which, nonetheless, often seems far from the reality of our times.

The second part of this book is even more relevant to the factory, its culture and the work that is done there, and it opens with a testament to the presence of something that lies beyond a “rational examination” of the actions of a businessman, which require more than mere calculation to properly evaluate.  Then comes the story of the factory during the war, which serves to lay some unusual (apparently for many, if not for Olivetti) groundwork for the factory of the future. To the question of what is to be done, Adriano Olivetti responds, “We will be led by spiritual values, as such values are eternal. Following these values, the tangibles will arise on their own, without having to go in search of them.” 

In the wonderful introduction to this work, Gustavo Zagrebelsky is right when he says that Olivetti’s ideas may have “seemed out of this world”. In fact, Olivetti was, and is, “out of that world and today’s world, but he sought to represent entry into another world”.

Utopia, both then and now, but quite the breath of fresh air for everyone.

Le fabbriche del bene

Adriano Olivetti

Edizioni di Comunità, 2014

Often, a single enterprise can be a case study for a variety of issues, whether it be marketing, efficient management, labour relations, market strategy, or organisation. Perhaps somewhat less often, the topic of a study is the overall configuration given to an organisation, i.e. the spirit or essence on which the organisation is build and managed. In these cases, the enterprise becomes both a case study and a symbol, something to be studied throughout the world. Adriano Olivetti’s Olivetti is perhaps the most emblematic case in Italy, but it isn’t the only one. There are also organisations like Pirelli or Fiat, not to mention the great many other smaller firms that have been a part of Italian industry over the decades. Today, Brunello Cucinelli is another example of this sort of organisation, one that is unique, inimitable, intriguing, instructive, and something to be better understood. David LaRocca, out of Cornell University, has taken a global approach to this challenge in a lengthy paper published just a few days ago in the Journal of Religion and Business Ethics. The first part of the study analyses Cucinelli’s ideas about fundamental aspects of society, particularly at the nature of luxury from a humanistic point of view of enterprise. The second part is an analysis of the ethical view on business. 

 

The paper also manages to provide a holistic look at work and at Cucinelli’s approach to business. “The Italian fashion entrepreneur, Brunello Cucinelli, has earned a reputation for translating ideas from the history of Western humanism into the core of his business practice,” the author of the paper writes. “His business ethics are as informed by Aristotle, Aurelius, St. Benedict, St. Francis, and Kant as they are by contemporary marketing theorists such as Theodore Levitt.” The paper then goes on to describe “Cucinelli’s perhaps unexpected, even uncanny (and at times disconcerting) use of Western philosophy and religion to frame and underwrite his business enterprise”. 

 

The study seeks to provide an objective, critical look at the work of the entrepreneur while calling upon a range of authors and other figures, such as Pope Benedict XVI, Leonardo da Vinci, Marx, Veblen, Bill Gates, Steve Jobs and Martin Heidegger.  “[T]here are many tenets that would seem intuitive […] for example, treat your workers well and they will perform better,” the author writes, and there is also all of the philanthropic work of Cucinelli himself, which characterises both his personal focus on culture and his approach to business. Nonetheless, LaRocca also take a more critical look at Cucinelli when discussing aspects of his approach that is “sometimes vague and contradictory”, but acknowledges that he has created a “model of sufficient empirical success”. 

 

This work by LaRocca is not always the easiest to read, but it is certainly a nice look at Italy’s brand of entrepreneurship. 

 

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Brunello Cucinelli: A Humanistic Approach to Luxury, Philanthropy, and Stewardship

David LaRocca Ph.D. (Cornell University)

Religion and Business Ethics: Vol. 3, Article 9

In Europe, “attention [is] finally on the real economy” according to Arberto Quadrio Curzio in Il Sole24Ore as he expressed approval for the plans of Jean-Claude Juncker since being elected president of the European Commission. The document presenting the way forward under JCJ (his name being shortened to an acronym much to the joy of newspaper headline writers) bears an ambitious title, “My agenda for Jobs, Growth, Fairness and Democratic Change”, and Quadrio Curzio appreciates his pragmatic approach, regardless of the – now de rigueur – debate as to the essentiality of the fiscal compact (fixing public accounts before being able to think about growth), the limits of the “flexibility” in (and not of) the Maastricht parameters, and the need to reinforce industrial compact decisions to increase and improve the competitiveness of Europe’s economy and, above all, of its industry.

JCJ points to “ten policy areas” and emphasises the principle of “subsidiarity” in recalling that it is, above all, companies that create jobs (those who give credence to the quasi-Keynesian formula that gives public spending responsibility for defending and generating jobs are now on notice) and that, as Quadrio Curzio notes,

EU public funding can, and must, be used to better effect in order to drive investment in the real economy and bring about a beneficial synergy between the public and private sectors. So it is not welfare statism, although there is an awareness of the importance of the social aspects of the crisis that we still face and of the choices of a “social market economy”, but rather drivers of investment and development (along with the corollary of support for research, innovation, education and infrastructure) and with companies leading the way.

In other words, the real economy. The actions in the “policy areas” point to EU investment in integrated infrastructures (digital and broadband, energy, transport, new technologies). Quadrio Curzio underscores the strengthening of funding both through a more efficient, more effective use of the EU budget and through the European Investment Bank (EIB) and public-private partnerships, as well as through new mechanisms of business financing. JCJ has committed to presenting, by early autumn, a plan to mobilise €300 billion in investment over the next three years. As Quadrio Curzio notes, this would create infrastructurally integrated markets and greater competitiveness, especially for manufacturing, which JCJ wants to see reach 20% of EU GDP. In order to ensure that small and medium enterprise, which provides over 85% of all jobs in the EU, also benefits from this strategy for real growth, JCJ is also committed to a radical simplification of European legislation, with the hope that this will also trickle down to the national level. The inclusion of the EIB is also important in that its efficacy is to be improved (over the course of 2013-2015, it can free up as much as 180 billion in additional investment for the real economy, from infrastructures to the SMBs), and the lack of reference to the ECB is also important, which is being seen as an appreciation of its autonomy and the role it has played thus far in supporting Europe’s economy.

Europe is on the move, but what about Italy? How do we intend to be a part of JCJ’s new strategy? The numbers on Italy are still negative, with expectations on GDP growth (source: Bankitalia) being adjusted downward to just 0.2% for 2014 (as opposed to government forecasts of 0.7%). Competitiveness is declining due, above all, to the lack of foreign investment, the burden of taxes, the complex, opaque legislative and bureaucratic landscape, a lack of services, and the loss of jobs (Italy’s economy has slipped six places in two years in the rankings of the World Competitiveness Center of the Institute for Management Development (IMD) in Lausanne, dropping from 40th to 46th place and far below Germany, France and even Spain and Portugal). Manufacturing and services are stagnant (according to Mediobanca’s R&D surveys of the accounts of Italy’s leading corporations). Industry isn’t firing on all cylinders, and export growth for the leading firms is clearly not, on its own, enough to offset a crisis that is clearly still under way (and having serious repercussions on jobs and on income).

And the government? They have announced a plan to revitalise Italy that includes efforts to increase investment and to promote the sort of quality Italian manufacturing that the world expects from us. “If we work hard on the offering, we’ll have twenty years of real wellbeing before us”, predicted a confident Carlo Calenda, the deputy minister for economic development, looking mainly to gain strength in international markets. And so more investment, more innovation, more internationalisation, less bureaucratic complexity (and less corruption, which is a major obstacle to a sound, competitive economy).

JCJ’s plan is a good European framework within which to include the renewal and revitalisation of Italy’s economy. The best companies (a few thousand of the larger corporations that drag along the smaller ones) are already thinking in these terms. Italy’s culture of enterprise is one of innovation. It is a challenge for all policymakers and for public administration, and it is one that we must not lose.

“Modern in that which is worthy of becoming antique. Modern is the spirit of the times, but its true form cannot but be classical”. In this wonderful quote by Dino Gavina lies one of the keys to pondering tradition and innovation in Italy and thus the intertwining of humanistic knowledge and scientific culture antinomy that goes beyond the traditional (and mistaken) paradoxes. Gavina was a designer (one of the “maestros” of the 1950s and 60s along side Munari and Mari, Ponti and Castiglioni) and so was used to reflecting on culture and enterprise, on form and function, words and numbers, designs and products, and to finding unique syntheses of thought and action, of an idea and its execution. This, of course, is the essence of good manufacturing and of the “polytechnic culture”, one might even say, borrowing a phrase much loved by the Pirelli Foundation. In other words, there is a close connection between “modern” and “classical”, between innovation and its roots in history, between the fundamental values of science and the humanities from which modernity draws its creative energy, and this connection is to be understood and fed. Historical and cultural heritage is our past. Science and creativity are the innovative tools used to create that which will be the heritage of tomorrow.

These words of Gavina’s come to mind when reading the thoughts of Carlo Rovelli, a theoretical physicist and recent recipient of the Merck Award, as to why Italy is a nation lacking in scientific culture (see La Repubblica, 19 July). It is an analysis of education and knowledge and of a cultural deficit tied to an underestimation of the importance of research, whether “pure” or “applied”, in producing innovation that can be used in business and that can aid in economic development (a contrast that Italy has, at times, been able to avoid, as seen in the story of Giulio Natta, a Nobel laureate for chemistry in 1954 and the father of polypropylene – a key success story of Italian industry – with his Moplen). Rovelli believes that Italian schools are among the best in the world, paradoxically so for anyone with a passion for science in that Italian students have something that other nations struggle to provide: not just creativity and flair, but also – and above all – a great depth of culture. As Rovelli writes, “I’m convinced that studying Dossena, Kant and Michelangelo provides a scientist with more finely honed tools of thought than does spending hours calculating integrals like kids do the élite schools of Paris”. And he continues, “The ability to look to the future and see key problems came out of Italian education and the breadth of its historical and cultural prospective”. What is lacking, on the other hand, is science. Italy, he claims, is “a nation dangerously lacking in scientific culture compared both to other European nations, where science in profoundly respected, and perhaps also to emerging nations, where scientific culture is seen an the key to their development”. Confirmation of this lack of culture lies in “the lack of serious science in school; the inability to hold debates in which points and counterpoints are listened to with care; the widespread ignorance of science among our élite, beginning with our Parliament; and, even worse, the tiresome airs of those who brag that they understand nothing of science”.

And yet Rovelli also writes, “Culture is the richness and complexity of knowledge, the set of conceptual tools used by a community to reflect on themselves and on the world. Classical and scientific culture are complementary sides of this whole, each reinforcing the other.

[And so] our nation’s lack of scientific culture is a grave weakness. Both wealthy and emerging nations know that, without sufficient scientific culture, a nation today falls quickly behind. And Italy has fallen behind.”

But this hasn’t always been the case. Rovelli describes Galileo as “perhaps the most extraordinary product of the heights of the Italian Renaissance, a man of music and of letters, a profound connoisseur of classical antiquity, of Aristotle and Plato […] and the founder of modern science, the first to understand how to interrogate Nature, the first to find a mathematical law to describe the motion of bodies on land, the first to look to the heavens at things that no human had ever before imagined” and as a figure to be given greater consideration. “I wish that Italy were proud of Galileo and not just of Raphael”, he writes, that Italy would rediscover Piero della Francesca, the mathematician, and not just his great skills as a painter, we might also add. In short, we could finish up with Rovelli, who writes, “I wish that Italy would move away from the idea that culture is just the antique arts or sterile knowledge of one’s past, that Italy would grant culture, and scientific culture in particular, the dignity that it must have in educating the individual.”

Boomerangs, business and Charlie Brown have a lot in common. The first is a treacherous tool. It requires space, timing and great care, as well as a good dose of risk. It’s no toy no matter how you look at it, something that Charlie Brown found out first hand when he tried his best to use one, but without much success. The boomerang is also a metaphor for the challenges and surprises that arise, both in life and in business, and this is why the latest work by Nicola Palmarini (a graduate of Università Cattolica and with a specialist qualification in Mass Communication & Society from the University of Washington, Seattle) takes inspiration from the boomerang to then talk about innovation, creativity and new technologies that were not always as successful as hoped.  

Boomerang, a 200-page book available in both hard-copy and electronic format, is a nice read that is helpful right from its subtitle: “Why a hundred years of technology hasn’t made for a better world (yet)”. In fact, the issue of what innovation and technology can cause is all right there. Why, instead of generating wellness, do they often just lead to “illness”? 

Palmarini uses the example of the boomerang as an analogy for the way in which we have conducted our research and pursued our dreams and ambitions over the last hundred years with the use of technology and in the name of a future that, in the opinion of the author, looks increasingly like utopia, all instilled, naturally enough, with the same idea of production and business, the same culture of making and innovating. 

The book is a collection of the great many boomerangs that can be found throughout the history of society and enterprise: the false idols of entertainment and culture; the failings of the welfare state; the social and cultural levelling of fashion; the blind spots that can be created by the web and instant communication; the confusion and lack of communication in modern language; the uncertainty and anxiety created by the Internet; the underlying difficulties and dis-ease of many organisations (and manufacturers in particular); the myth of the smart city, and the myth of profits and of successful finance.  All of these are boomerangs – some that have covered a very short flight path, others that are still in flight, and still others that will complete their flight today or tomorrow – with the words “The End” engraved in them. 

But Palmarini also writes of the potential for redemption and for avoiding the harm that can be caused by boomerangs. It’s what he calls etica del limite (literally: ethics of the limit), which can help businesses and society to land on their feet. It’s a sort of self-awareness of issues – cultural concepts, really – such as pollution and the environment, respect for others and for their future, and even more specific issues such as the use of water and other natural resources, the use of chemicals, and the production of energy. 

Towards the end of this work, Palmarini does, of course, say that there is no “magic button” that we can push to solve everything, but there is a sense of our limits, a sense that must be achieved and that arises from the particular ethics through which we must seek to see all things, including (and perhaps above all) matters of manufacturing and consumption.

At a certain point in his book, Palmarini makes an all-too-true statement that should give us all something to think about: “As the pace of change accelerates, we are seeing an equally rapid deceleration of culture.” 

Boomerang is, indeed, a book that makes you think and which often makes you anger, but it is also one to be read over and over again. 

Boomerang. Perché cent’anni di tecnologia non hanno (ancora) migliorato il mondo

Nicola Palmarini

Egea, June 2014 

How can organisations that have the goal of making a profit collaborate with organisations that work to achieve social wellbeing? This is an important question, especially in this day and age, because, on the one hand, social responsibility in the for-profit organisation is becoming an increasingly hot topic and, on the other, the work of non-profit organisations is growing in importance just as the problems to be solved are also increasing. Actually, there have always been certain ties between organisations that seek profits and those that have other goals. Nowadays, however, these ties are more complex and so, perhaps, more interesting to explore.

Therefore, in order to understand them better, it takes a keen eye that is able to see the many realms that connect these two types of organisation, not to mention the culture of enterprise that underlies each.

It is for this that one should read Cross-fertilization tra mondo profit e imprese sociali (Cross-fertilization between the for-profit world and social enterprises) by Laura Corazza (University of Turin), an article that recently appeared in Impresa sociale and which looks at the links between “normal” for-profit corporations and social organisations in order to understand the mutual influences and benefits. 

The study centres around an actual case study concerning the European project Lessons and Options for an Integrated European Approach to CSR (LOIEs), which includes a series of interviews with some of the people involved (and particularly members of the corporation Divitech SpA and of the social cooperative ORSO). A project of a year and a half that began in March 2012, LOIEs is an example of how organisations with different goals can actually work together. 

First of all, however, Corazza summarises, in just a few pages, the theory behind the connections between profit and non-profit organisations using the method of cross-fertilisation, which is an ongoing process of sharing knowledge, ideas and suggestions that arises prior to the creation of an actual partnership between diverse organisations. 

By looking at both theory and practice is this way, Laura Corazza reaches three conclusions that can be applied in many other similar cases. Cross-fertilisation really works and acts on at least three levels: the first is psychological (starting to work together has an important emotional impact); the second is managerial (good results come when the management of the organisations involved talk with each other and truly collaborate with each other); the third is technical/operational (by working together, the organisations can come up with new services and new products). 

The article does have one other quality: the fact that it was written using clear language and does a good job of presenting a different way of looking at culture of enterprise today.

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Cross-fertilization tra mondo profit e imprese sociali

Laura Corazza

Impresa sociale, no. 3, April 2014

“”Relationship capitalism” is damaging the most vital, most competitive part of Italy’s economy [and promotes] unproductive, inefficient public spending [often aimed at] satisfying the specific interests of lobbies and rent-seekers”. In other words, it is holding back balanced growth for the nation as a whole and is to be stopped through policy decisions and reforms that focus on competitiveness, productivity, and sound culture of enterprise for an open, transparent, well-regulated and well-controlled market. This harsh assessment of the damage being done by “relationship capitalism” comes from an authoritative source, Prof. Giovanni Pitruzzella, president of the Italian antitrust authority and expert in constitutional law, a man who studies carefully the economic aspects of government policy and legislation, and it can be found in the annual report that the antitrust authority presented to the other institutional authorities and to the world’s economic and political leaders (on 30 June of this year).

Pitruzzella points the finger – and rightly so – at a series of unwritten, yet well-established rules “based on privilege, rather than on merit [that] heighten inequality, make society closed, static, and not open enough to competition and innovation” and focuses on the defects created by a perverse web of guilds made up of (state and local) bureaucracies and of corporations averse to competition, of backchannel relations mired in bribery and the exchange of favours, and of market distortion in the name of the clientelism (with all of the consequences in terms of the dramatic rise of the influence of organised crime not only in areas where it has traditionally been strong, but even in the richer regions of northern Italy). This statement of Pitruzzella’s is dense with ethical and political importance. It emphasises issues of lawfulness (which have, for some time now, been growing in importance for business leaders and industry confederations and organisations, from Confindustria and Assolombarda to their counterparts in the Veneto and Piedmont regions), but also points the spotlight at the issue of Italy’s efficiency, productivity and competitiveness, which this “relationship capitalism” both hinders and distorts.

There was a long period in the history of the Italian economy that was governed by the rules of “inner-circle capitalism”, characterised by privileged relationships between major corporations and the financial system, all under the umbrella of Enrico Cuccia’s Mediobanca, a network of intertwined relations backed by “shareholder agreements” that was essentially conservative and fairly closed to the more vibrant dynamics of the stock market and of the marketplace. This network served to protect the best of private-sector capitalism from the incursion of the worst of Italian politics (and from the attacks of market speculators much like Sindona, serving as a front for organised crime).

This, too, was also referred to as “relationship capitalism”, but this, compared to the analysis of Pitruzzella, had features that were quite different. (To get a better idea, one might read a couple of recently published books, such as Cuccia e il segreto di Mediobanca, written by Giorgio La Malfa and published in Italian by Feltrinelli, or Promemoria d’un banchiere d’affari, which is an interesting collection of writings by Cuccia – edited by Sandro Gerbi and Giandomenico Piluso and published in Italian by Aragno – which provide a detailed and, at times, original reconstruction of the role played by Mediobanca in the second half of the twentieth century in Italy and which shed much light and cast a few shadows on the system in particular.) It was a protective capitalism ruled by a strong man of the utmost integrity. It may have been adverse to transparency and to the market, but it did have a system of sanctions and of merit. It was a system made strong through its autonomy, both from politics and from the worst of the freewheeling temptations of the companies themselves, and it was, nonetheless, a form of capitalism that was already in crisis in the 1990s before definitively fading away. (It would be interesting for historians to eventually attempt to provide a serious, unbiased account of those times.) Goodbye, shareholder agreements. It was time to learn to be a part of the market and, even better, of the markets of international competition.

The “relationship capitalism” of which Pitruzzella speaks is something entirely different, something to be combatted and overcome. How exactly? Through greater commitment to privatisation and liberalisation, so as not to replace public monopolies with private-sector ones and in order to bring an end to a sort of “municipalistic capitalism” of the local public enterprises, as well as through the coherent efforts of the antitrust authority, which has been, as Pitruzzella put it, “focusing on those areas in which relationship capitalism is strongest and in which proper competition could provide a push towards competitiveness and growth”, areas such as energy, transportation, services, digital communications, online commerce, and financial services, which are the same as those on which the European Commission is focusing.

There’s a lot of work to be done, but it is possible. Less bureaucracy, fewer guilds, less clientelism, more market and, therefore, more development. Honest businesses and an Italy looking to grow will all be grateful.

A business and its leadership can lead the way towards a “new beginning”, so long as they are “happy”, so long as they are, in other words, guided by clear principles and focus on the enhancement of social wellbeing. It’s an idea that may seem antagonistic – and in some ways it is – but it is also an idea to be taken quite seriously because the image of the “happy business”, one that embodies a new model for society, is certainly a concept to be explored. 

To do so, one might read the latest work by Renata Borgato (an instructor with the Department of Psychology at the University of Milano-Bicocca, and a corporate trainer). Entitled L’impresa felice. La responsabilità sociale come impulso alla crescita (The happy business. Social responsibility as a driver of growth), this book of just under a hundred pages seeks to bring together a number of apparently distinct concepts: the enterprise as a machine for products and profits, corporate social responsibility, and the role the enterprise can play in leading the creating of a new model for society.

“The perception of the seriousness of the current crisis gives us reason to expect a new beginning,” says Borgato. “But we must find the right leader for this process of change to serve as a point of reference that the traditional social partners are no longer able to be. This leadership could be provided by enterprise. It is not by chance that jobs have always been one of the founding elements of society.” The happy business is clearly defined right from the outset. It is an entity that is a part of “a solid core of manufacturers, farms and service firms that have adapted their global strategies and that represent a solid block of the real economy, as opposed to the break-up of the finance economy”. 

This is the starting point from which the book then explores the link between enterprise and the community, between the enterprise and ethics, and between the enterprise and the people that bring it into being. Borgato then touches on delicate matters such as the empathy that should arise in the organisational structure, in leadership, in communication, in the motivation and evaluation of employees, in work schedules, and in the handling of mistakes. Having covered all of these aspects, the author moves on to take a look at the “seven deadly sins” in business, namely: “pride”, “greed” and “sloth” in management and in projects; “envy” and “wrath” in the organisation; “gluttony” and “lust” in the goals to be achieved. It’s easy, for example, to slip into organisational relations in which envy takes the place of collaboration or into management that leaves room for the ego of the individual or into the laziness of maintaining the status quo without seeking innovative forms of production and administration. Indeed, a happy business is not what comes out of goals centred around a thirst for power or for money. 

The book concludes with a note by Luciano Pero, who describes – in contrast to these deadly sins – the four cardinal virtues of “prudence”, “justice”, “courage” and “temperance” and how they apply to a business model that could give meaning to the community. At the end of the day, the happy business comes from prudence in planning and in management, backed by the strength and determination of the business’s leadership and its employees, all working together towards just goals. 

Towards the beginning of the work, there is a nice example of the happy business, one that embodies the virtues and eliminates the sins. Brunello Cucinelli, a fashion magnate, tells of his business and the common interests of employer, employee and community and says, “Profits are to be divided into four parts. The first goes to the business to make it strong; the second comes to me as the business owner; the third goes to the workers in the form of wages (with are roughly 20% higher than required by the national collective bargaining agreement), and the fourth goes to beautifying humanity, to the creation of services – a theatre or a hospital, for example – that the entire community can enjoy.” 

L’impresa felice. La responsabilità sociale come impulso alla crescita

Renata Borgato

Franco Angeli, 2014