Respect, shared values, and mutual trust among individuals, businesses,
NGOs, and government officials are the foundation of a market economy.
To compete effectively and sustain economic growth, enterprises need
social capital as well as financial capital. To contribute to this social capital,
an RBE can
• Make the case in its community for a market economy and the role of
responsible business.
• Develop a reputation for meeting the reasonable expectations of its
stakeholders.
• Agree to voluntary forms of alternative dispute resolution, such as mediation
and arbitration, while domestic courts are formed.
• Take responsibility for its mistakes and misconduct.
• Be willing to be held accountable for its mistakes and misconduct.
18 Business Ethics
• Correct misunderstandings about its decisions and activities.
• Compete fairly with competition, both foreign and domestic.
How effectively, efficiently, and responsibly an enterprise is able to add
value to its community depends, in large part, on how much its stakeholders
trust one another. As described further in Chapter 2, where market participants
and community members cannot trust one another, transaction costs
soar. It may be that in markets and communities, especially in emerging market
economies, the value an RBE most profitably adds is to be worthy of
trust—and to encourage other market participants and community members
to be trustworthy as well.
Where a society wants to evolve from a command to a market economy, the challenges presented to individual enterprises can be daunting. All economies face the same fundamental issues of responsible business conduct—product quality, transparency in financial matters, orkplace health and safety, protection of the nvironment, protection of workers, and compliance with laws and industry standards. However, they are magnified in both degree and kind when an entire society is making a rapid evolution toward a market economy.
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