Illustration by Graham Roumieu, 2011

The world of business can be a happy household – just ask Aristotle.

The Greek philosopher defined business in two ways: chrematistics, which means the art of money-making, and oikonomia, the Greek root word of economics, meaning household stewardship or management.

A household is ultimately an enterprise—a group of citizens who choose to live and strive together for the purpose of optimizing their well-being and happiness. A business is simply a legal enterprise that is ultimately an extension of a household. By nature, I believe we are all economists who run an enterprise called a household for the purpose of pursuing happiness.
Yet fundamentally, business has strayed from this principle.

In eight years of teaching business students at the University of Alberta about ethics, corporate responsibility and social entrepreneurship, I have often posed the question: what is the role of business in the 21st century? This year, the discussion led my students to a sobering conclusion: they were graduating as professional chrematists, being taught to pursue profit above all. And they weren’t happy about it.

The majority of Canadian and U.S. business schools continue to teach that the primary purpose of business is to make money or maximize profits for owners and shareholders. However, I believe this philosophy is problematic, particularly so when one looks closely at the statement of “best interests” in a business’s legal charter. In fact, there are no clear statements about what a business is responsible for.

The demand for greater corporate social responsibility (CSR) over the past 15 to 20 years has been driven by several factors, including the Enron and WorldCom scandals and the Madoff affair. CSR has taken the form of sustainability reports, triple-bottom-line accounting and the ongoing promotion of the new image of companies trying to do good. But some cynics, including many of my business students, believe these are merely token gestures, made mostly by larger companies, serving to mask the corporation’s true character.