Social Responsibility No. 1
No company experienced more lost lives in the attacks of 9/11 than Cantor Fitzgerald, a brokerage firm that once occupied the 105th floor of the World Trade Center. Six-hundred and fifty-eight of its employees were killed that morning, and many thought the firm would cease to exist. When Cantor Fitzgerald’s CEO, Howard Lutnick, who had survived, cut off checks to the families of the deceased, many even hoped it would cease to exist.
But, as the New York Times related in a story over the weekend, Lutnick has come up with a happier epilogue than that. “He has rebuilt his firm, and then some,” the Times reported. “And many of those who criticized him at the time, notably, spouses and parents of Cantor employees who had died, now say he did the right thing.”
[EXPAND More]In fact, by surviving, the firm was able to regain enough profitability to help those who’d initially found themselves cut off. “The only way to take care of everyone was to have a company,” Lutnick told the Times.
As we’ve discussed, Peter Drucker believed strongly that businesses have responsibilities that go beyond simply making a profit. Still, at the same time, he asserted that “the first social responsibility of business . . . is to make enough profit to cover the costs of the future.”
“If this social responsibility is not met, no other social responsibility can be met,” Drucker asserted in The Frontiers of Management. “Decaying businesses in a decaying economy are unlikely to be good neighbors, good employers, or socially responsible in any way.”
For Cantor Fitzgerald initially to have cut off payments to grieving families was harsh, but to have kept paying out may well have overtaxed its own ability to continue on. “An organization has full responsibility for its impact on community and society,” Drucker wrote in Post-Capitalist Society. “It is, however, irresponsible for an organization to accept, let alone to pursue, responsibilities that would seriously impede its capacity to perform its main task and mission.”
What companies do you see out there that are doing the best job of balancing all of their social responsibilities—including making a profit and beyond? [/EXPAND]