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Tuesday, April 10, 2018

Strategic CSR - A 'professional'

The article in the url below was written by Frank Abrams for HBR in 1951. At the time, Abrams was 'chairman' of Standard Oil of New Jersey (which later became Exxon). I learned two things about this article from the late, great Bill Frederick. First, that this article (and not the better-known 1953 book by Howard Bowen, Social Responsibilities of the Businessman) represented the beginning of the CSR movement in the U.S.; and, second, that the article was actually ghost-authored by Courtney Brown when she was Dean of the Business School at Columbia University – Brown had previously worked for Abrams at Standard Oil.
I assign this article for my students in the first class of my strategic management course. I do so because Abrams' main point is that, in 1951, the job of being a manager was about to become a profession (and, by implication, the MBA was the vehicle by which this was to occur):
"Briefly, it seems to me that business management in the United States is acquiring more and more the characteristics of a profession."
As I point out to my students, however, today, we are further from that point than we were in 1951. This is clear when you consider the three main characteristics that define what it means to be a professional:
  1. A sense of duty beyond the self.
  2. A certified body of knowledge (governed by an accreditation organization).
  3. A code of ethics.
By these criteria, clearly, a manager is not a professional, even though most business schools label their MBA programs things like the 'professional program.' Nevertheless, it is worth emphasizing what might have been. What strikes me in particular about the article is Abram's vision of the high sense of duty that a manager has to society:
"There is no higher responsibility, there is no higher duty, of professional management than to gain the respect of the general public through objective participation in, and consideration of, national questions, even though these questions in many cases do not relate directly to their immediate business problems."
In fact, Abrams refers to the work of a manager as something closer to a patriotic duty:
"There is an underlying patriotic motive in all of this which an intelligent management thoroughly understands. In a democratic state, only those institutions which so conduct themselves as to deserve, secure, and hold public confidence can survive and prosper. It is a plain ordinary fact that our country, to be strong and constructive in a troubled world, is dependent upon free, competitive institutions to give its people opportunity of self-expression and advancement. If we are to be helpful in advancing our American way of life, we must be willing to show by example that individual objectives can best be served when they are identified with the common good."
The reason that society confers professional status on a particular job is, essentially, for protection. For example, there is a reason why society does not let me open a hospital and start operating on people (like a medical doctor), because they would die if I did. That is the same reason why society does not let me design and build buildings (like an architect), because those structures would fall down. In other words, in order to protect against the potential harm that can be caused by poorly-trained people doing those essential jobs (even if they are confident that they can), society sets very high standards (a form of quality assurance) to minimize the risks. In return for the strict requirements demanded in order to become a professional, society grants a monopoly to that group to practice that particular job (and reap the rewards for doing so).
What is important about this is that there is no such requirements to start up a business and call yourself a manager. Society has decided that it is willing to make the trade-off between risk and reward for business. If you have an idea and think it will be successful in the marketplace, you can form a company and try it out with very few barriers in your way. Of course, if you fail, the business can cause harm, but society is willing to take that risk in the hope of fostering the next Google, or Amazon, or Apple, or whatever the next life-changing company will be.
That is why managers are not professionals and the MBA is not the certified gateway to becoming a manager that it could have been. I'm not saying we would have been better off if the manager was a true professional, but I like to teach this to students to open their eyes about the risks/rewards of business, as well as the lack of understanding in most business schools about what it means to be a true professional. I also like to emphasize the business school's role in failing to create the conditions necessary to bring this about. Having said that, I make the point that, just because management is not a profession does not mean that they, as MBA graduates, cannot carry themselves as a professional by adopting the characteristics of a professional. To this end, the MBA Oath (, see also Strategic CSR – MBA Oath) initiated by Harvard MBAs for graduating students, is a good start.
Take care
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Management's Responsibilities in a Complex World
By Frank W. Abrams
May, 1951
Harvard Business Review
Vol. 29, No. 3