How might one empirically assess the contribution of business actions to peace?


(Business Fights Poverty) #1

Smita Trivedi: Assistant Professor of Business and Society/Sustainable Business, College of Business, San Francisco State University
John Forrer: Associate Research Professor of Strategic Management & Public Policy Associate Faculty, Trachtenberg School of Public Policy and Public Administration, George Washington University
Tim Fort: Kelley School of Business, Indiana University
Phyllis Blees: President, Peace through Commerce
Begoña Casas Sierra: Associate Professor Ethics, Negotiation and Management Skills, Education and Professional Development Department, Social Science and Communication Faculty, Universidad Europea

This written discussion is part a new month-long Challenge with Indiana University around the question: “What role can business play in pursuit of peace?” The Challenge consists an online programme of written articles and online discussions, available on the Challenge homepage.

Despite the fact that broad macroeconomic connections between business and peace have long been acknowledged more needs to be done. This Challenge aims to deepen understanding around the role that business can play in peacekeeping, peace making, and peace building.

This discussion focuses on how one might empirically assess business actions and how such quantification might be valuable for businesses and society alike. A one-hour live panel will take place on Wednesday 26 October from 10am ET / 3pm UK.

The discussion will focus on three questions:

  1. What are some of the options for empirically measuring the contribution of companies to peace?
  2. What are some of the issues involved in measuring the contribution of businesses to peace?
  3. Some argue that we should rank companies on their contribution to peace, or alternatively certify them against some standard. Which might be better and should they be made public or used to inform internal management decisions? What role should business play in developing these approaches?

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(yunqian gong) #2

Thinking of the first question, I would say there are many different ways for companies to contribute to peace. For example, Marketing is a very good way to promote peace to people. Businesses can use social media to share peaceful advertising campaigns. For example, BMW has a Blessing Basket Project, which helps people live in Africa to sell their handmade baskets. BMW makes a lot of advertisements not only on their website but also on TV. Moreover, it is also a good way for companies to contribute to peace by increasing the diversity.


(Jeanne Susanto) #3

For the first question, I also agree with Yunqian Gong that one of ways that a business can promote peace is through marketing. A business can sell its products/services by contributing to the world peace, like a business can give donation to the United Nations everytime a consumer purchase the products/services. An interesting example of it is how Coca Cola launched a campaign called Coke Small World campaign where they put videos of poor condition in Pakistan and India by putting live video feeds on the vending machine.

To answer the second and third question, we realize that sometimes we cannot really get the exact measurement on how a business supports peace and fight poverty. We might not know whether the business really send all of the help or not which is why I might say that it is important that a business proves it by making another commercial/announcement showing that the donation has been delivered to the right party. I am not sure that I am agree with how a business should reach a certain standard to get certified. I always believe that when one has the intention to do good deeds, we should not measure it while we should embrace it despite of how much or how big the effort is.


(Victor Lu) #4

Regarding the third discussion question - specifically "What role should business play in developing these approaches?" – I can’t help but think about potential perverse incentives that could be introduced. As an example, the documentary Poverty Inc. illustrates how many of the most well-intentioned charitable efforts to eradicate poverty actually reinforced many of the underlying causes of poverty. This is because charitable handouts to poor countries in the form of free or subsidized resources can disrupt local entrepreneurial efforts that have greater potential to introduce sustainable prosperity.

I am of the opinion that businesses operating in poor countries will inherently support conditions for greater peace (provided that they operate ethically) through the creation of employment opportunities and economic growth – two powerful drivers of societal stability. Thus, the best role businesses could play in the contributing to peace is to pursue the profit motive. More direct attempts at developing peace – perhaps in the form of conflict intervention – should be left to state authorities.


(Alec Engblom) #5

I agree with Victor that the best way a business can promote and produce peace is to go about their daily actions to increase profits. In poorer countries where these companies that choose to do business they bring with them opportunity and employment that help the overall community and increase the standard of living. When a business takes responsibility of conflict prevention they are allocating unnecessary resources toward this process. These responsibilities should be left up to a state authority that has the available resources so businesses can focus on increasing their own profitability and expanding to other areas of the world they may be needed.

Victor Lu said:

Regarding the third discussion question - specifically "What role should business play in developing these approaches?" – I can’t help but think about potential perverse incentives that could be introduced. As an example, the documentary Poverty Inc. illustrates how many of the most well-intentioned charitable efforts to eradicate poverty actually reinforced many of the underlying causes of poverty. This is because charitable handouts to poor countries in the form of free or subsidized resources can disrupt local entrepreneurial efforts that have greater potential to introduce sustainable prosperity.

I am of the opinion that businesses operating in poor countries will inherently support conditions for greater peace (provided that they operate ethically) through the creation of employment opportunities and economic growth – two powerful drivers of societal stability. Thus, the best role businesses could play in the contributing to peace is to pursue the profit motive. More direct attempts at developing peace – perhaps in the form of conflict intervention – should be left to state authorities.


(Jun) #6

I agree with Gong that advertisements are a good way to promote and contribute to peace. However, I do not think it can empirically measure the contributions each company has on peace. Are you just saying that the company made the most advertisements contributed the most to peace? I do not think so. I think a huge part in marketing is the conversion rate, meaning how many people actually did what the advertisements told them to do or how many people are actually being help by the projects. Taking Gong's BMW project for example, I think the only way to measure BMW's contribution are 1. how many baskets were sold? 2. how much money were raised? 3. how many African families were help in the project? I think by sampling using the amount of advertisement or marketing strategies a company used, it only tells the effort the company was contributing to peace. However, I think effort is not good enough. A devoted company who is contributing to peace should convert what they tell in their advertisement into actual numbers of financial figures.


(Brian Suhre) #7

Measuring the contributions of companies to peace is a challenging proposition, mainly because "contributions to peace" can be hard to define. However, there are some metrics that might help. First, charitable donations by companies is perhaps the most obvious metric. This can be further refined by focusing on charities that relate to poverty or operate in war torn countries, like the Red Cross/Crescent. Secondly, companies can be measured based on the number of war-torn or impoverished countries they operate in. This measurement should be augmented by metrics that account for wages, contributions to local charitable organizations, and employee benefits/education efforts. As Victor said, businesses that operate in impoverished areas inherently contribute to peace by providing employment.


(Joana Cruz) #8

Assessing the contribution of business actions to peace will need to involve a lot of data gathering. Conflicts or violence may differ per country, area, or even a small community, so it is best to take it into consideration when analyzing those data. A business or an institution will have to identify problems and possible root causes of conflicts or violence in the society, or in a community. After identifying conflicts or violence that has the most impact in that particular area, they can then formulate solutions or improvements for those problems. They can make certain benchmarks they want to achieve, and have a before and after comparison after implementing those probable solutions. It would be difficult to identify just one key solution to conflicts and violence, but rather it would be better to try different approaches and see which combinations will work best for a community.


(Katie Sikora) #9

I agree with a lot of people, when I say that business definitely has a role in peace. I think that what Anheuser Busch did during Flint water crisis is a great example. For one week, they took their production and canned clean drinking water instead of beer. This was something they were completely capable of doing, both production wise, and financially wise. There are so many other companies that are doing so well, and it would really put no financial strain on them to do something like what Anheuser Busch did, just to help someone. If more companies worked like this, there would be a lot more peace.


(Katie Sikora) #10

You make a great point, Brian. I think the easiest way to measure it would be to simply see if companies are making a good faith attempt to help those in need, since there is no good way to measure it financially speaking. Even if every company that was able to, just did something small to help the world, it could make a huge difference, and inspire others to do the same.

Brian Suhre said:

Measuring the contributions of companies to peace is a challenging proposition, mainly because "contributions to peace" can be hard to define. However, there are some metrics that might help. First, charitable donations by companies is perhaps the most obvious metric. This can be further refined by focusing on charities that relate to poverty or operate in war torn countries, like the Red Cross/Crescent. Secondly, companies can be measured based on the number of war-torn or impoverished countries they operate in. This measurement should be augmented by metrics that account for wages, contributions to local charitable organizations, and employee benefits/education efforts. As Victor said, businesses that operate in impoverished areas inherently contribute to peace by providing employment.


(Lauren Dekker) #11

As an answer to question number three, I think certifying companies against some sort of "peace standard" and making this public knowledge would be a smart thing to do. This would hold companies liable for their actions and might make them think about how their decisions might impact others.

Take for instance the Niger Delta, an area of Africa that is abundant with wildlife and is home to millions of people. Shell and ExxonMobil, two large international conglomerates, have been stationed here for decades. Given they are companies with such wealth and power, they have the ability to help the surrounding communities and create a peaceful interaction between them and the natives. Instead of this, they have relied on using their power to do what they want at great cost to the environment and people of the area. Thus, the natives have rebelled and there now exists a group of rebels known as the Avengers that go around sabotaging these oil pipelines. They have chosen to do so to make a point and rebel against the harsh treatment they receive from these oil companies. If Shell, ExxonMobil, and the other oil companies were to focus on rehabilitating this land, assisting the community with clean up and treating these communities with respect then they could exist together in peace.

Now if there was this so-called "peace standard" then maybe these companies would be a bit more conscious of their actions. They might choose to work with the locals and try to create a peaceful relationship with these people. At this point in time, the public and investors are a lot more concerned with the social responsibility and integrity of companies around the world. If this "peace standard" was public knowledge, companies might be more cognizant of it knowing that people are then aware of how they helping to make the world a better, more peaceful place.


(John Kim) #12

Measuring the contribution of the peace is definitely a big challenge as collecting the data may be very difficult. Once the data is found, another problem arises where as to find if the data is actually relevant to be used for the study of measuring the contribution. Once the big companies figure out the formula of showing external good side of the company, the true contribution of the peace is questionable. I agree that the measure of the contribution of the peace can only be comparable through data analytics because it is the factual and evidence that can be compared. However, there still lies the complexity of assessing whether the contribution was with the culture of the company of the brand image making events.

Joana Cruz said:

Assessing the contribution of business actions to peace will need to involve a lot of data gathering. Conflicts or violence may differ per country, area, or even a small community, so it is best to take it into consideration when analyzing those data. A business or an institution will have to identify problems and possible root causes of conflicts or violence in the society, or in a community. After identifying conflicts or violence that has the most impact in that particular area, they can then formulate solutions or improvements for those problems. They can make certain benchmarks they want to achieve, and have a before and after comparison after implementing those probable solutions. It would be difficult to identify just one key solution to conflicts and violence, but rather it would be better to try different approaches and see which combinations will work best for a community.


(Lauren Dekker) #13

I think Brian brings up some very good points. It will be difficult to measure a company's contributions to peace. Thus, there would need to be a set of standards and evaluation points for companies to be analyzed against. I agree with Brian's other points, but the last one on how businesses that operate in impoverished areas inherently contribute to peace by providing employment is not always true. Sometimes a company enters an impoverished area and needs only a few employees to keep the operation running. In this case, they provide few jobs and reap all the benefits. In the case of oil companies in the Niger Delta, they provided few jobs, polluted the environment and harmed a lot of the population thus leading to the state they are at now--rebels are sabotaging their oil pipes and nothing peaceful is happening there.

Brian Suhre said:

Measuring the contributions of companies to peace is a challenging proposition, mainly because "contributions to peace" can be hard to define. However, there are some metrics that might help. First, charitable donations by companies is perhaps the most obvious metric. This can be further refined by focusing on charities that relate to poverty or operate in war torn countries, like the Red Cross/Crescent. Secondly, companies can be measured based on the number of war-torn or impoverished countries they operate in. This measurement should be augmented by metrics that account for wages, contributions to local charitable organizations, and employee benefits/education efforts. As Victor said, businesses that operate in impoverished areas inherently contribute to peace by providing employment.


(Da Tong) #14

Regarding the first question, I think that it is common for a charity party to rank companies depending on how much they contribute at the end of the party. It is a efficient way to evaluate the contribution of companies to peace becuase the result is direct and observable. Many companies donate much money to NGOs which contribute to fight poverty in poor areas like Africa. At the same time, NGOs may list names of companies on website. It is a way to measure the contribution of companies to peace. Moreover, social media play an important role on measuring the contribution of companies to peace. People will phrase companies which donate to fight poverty on social media. People will critize companies which only consider about profits without social responsibility.


(Reiner Bennardo Riantan) #15

I agree that one way for businesses to contribute to peace is through advertising. However, I think companies should start introduce peace from inside the company; make peace as a part of their corporate culture. Companies can do this by making sure each employee is treated equally in every aspect. Moreover, companies should also make sure that all employees' voices or opinions are heard and responded. Management of the company should start the culture of respecting all employees and all stakeholders related to the company. By doing this, the management has set the tone at the top. When employees see their management respect them and other stakeholders, employees are prone to do the same. Through this, companies will have peace internally. And when companies have peace internally, I believe they will start doing everything to promote peace, including to the society the businesses are in.


(Vijay Kamath) #16

I am looking at the second question in the discussion, “What are some of the issues involved in measuring the contribution of businesses to peace?” One issue that arises is that many businesses have different views on peace. A business in the oil industry may view peace differently than a business in the clothing industry. Both businesses may think that they are contributing to peace, but their view on peace may not resonate with the public.

If a business wants to be environmentally friendly, there are many standards and examples that they can employ. However, the first question in the discussion also brings up another issue. Without having some kind of empirical measurement or benchmark that businesses can look at to view their contributions to peace, it is hard to know where they can start and what exactly a business should do.

Another point to consider is if a business is actually trying to contribute to peace. For example, if a business that produces plastic water bottles wants to be environmentally friendly, it may reduce the plastic needed to make the water bottle. On the other hand, by reducing the plastic needed to make water bottles, the business saves money by using less plastic per water bottle. The question then becomes, did the business have the intention to reduce costs in order to increase profits or was it to be environmentally friendly? This question will also come up when a business tries to contribute to peace. Do businesses actually want to contribute to peace or is their motivation to find a way to increase profits?


(Kabir Bhullar) #17

When it comes to business. One has to see the position they are in. Large business are in a position of power. If they say something people will hear it and it they do something people will react. With this, they are in the perfect position to make a difference. Specially in business there is alot of connection with people. This makes sense for businesses to affect and make a change in poverty around the world.


(Haley Moore) #18

Jun, your example of giving the companies efforts a numerical figure and giving the efforts a quantitative result are extremely necessary. It does now raise a question of how much is enough? How much money, baskets, and resources need to be devoted in order for them to be able to advertise that they are a business of peace? It's very subjective, and I think that everyone would have a different answer to both questions. I agree that when they do the advertisements they should be fully disclosing how they are making their contributions and how many people they are helping. That is one of the good things that come from the Internet with advertising. It reaches the masses and then we as consumers and advocates can hold them accountable.

Jun said:

I agree with Gong that advertisements are a good way to promote and contribute to peace. However, I do not think it can empirically measure the contributions each company has on peace. Are you just saying that the company made the most advertisements contributed the most to peace? I do not think so. I think a huge part in marketing is the conversion rate, meaning how many people actually did what the advertisements told them to do or how many people are actually being help by the projects. Taking Gong's BMW project for example, I think the only way to measure BMW's contribution are 1. how many baskets were sold? 2. how much money were raised? 3. how many African families were help in the project? I think by sampling using the amount of advertisement or marketing strategies a company used, it only tells the effort the company was contributing to peace. However, I think effort is not good enough. A devoted company who is contributing to peace should convert what they tell in their advertisement into actual numbers of financial figures.


(yunqian gong) #19

To answer the first question, I think today, many companies are trying to help people improve their living by giving back to society or charity. Toms is a good example. They will donate money to people in need when they sell a pair of shoes. By this method, Toms not only gives back to the world, but also increases their company reputation. The good reputation will attract more people to shop at Toms. Many of companies are doing the same thing like Toms. We can know many companies has a section called "social responsibility" on their websites to show they are willing to give back and help people in need.


(Jeanne Susanto) #20

I agree with your Reiner. I believe that every good thing should start from the inside then out. As what I have read, ethics is not something that you learn in one night. It should be done daily and it will become a habit. For a business, it is really important to start a good thing from the top to the bottom because the employees will reflect on what their supervisors do and act. I can see your point that if peace does not start from the inside of the company, how come they can advertise about peace in the society. Surely, it will not reflect what a company believes in. If a company can be honest about themselves, they can do it in front of the public and it will be easy for them to generate profit and known as a peace support business.

Reiner Bennardo Riantan said:

I agree that one way for businesses to contribute to peace is through advertising. However, I think companies should start introduce peace from inside the company; make peace as a part of their corporate culture. Companies can do this by making sure each employee is treated equally in every aspect. Moreover, companies should also make sure that all employees' voices or opinions are heard and responded. Management of the company should start the culture of respecting all employees and all stakeholders related to the company. By doing this, the management has set the tone at the top. When employees see their management respect them and other stakeholders, employees are prone to do the same. Through this, companies will have peace internally. And when companies have peace internally, I believe they will start doing everything to promote peace, including to the society the businesses are in.