ABSTRACT
Among the key lessons from Enron and other corporate scandals in recent years is arguably the point that it takes responsible leadership—and responsible leaders—to build and sustain a business that is of benefit to multiple stakeholders and not just to a few risk-seeking individuals. The corporate scandals have triggered a broad discussion on the role of business in society—its legitimacy, its obligations and its responsibilities. As a result, businesses and their leaders are increasingly held accountable for their actions—and non-actions—by a multitude of stakeholders and society at large. These stakeholder expectations extend beyond mere compliance with rules and regulations and adherence to ethical standards; they go beyond sustaining the economic bottom line, acting as good citizens and ensuring safe, fair, equal and respectful treatment of all employees. Instead, given the power of large corporations in particular, stakeholders expect that business leaders take a more active role and thus acknowledge their co-responsibility vis-à-vis the pressing problems in the world: protecting and promoting human rights, ensuring sustainability, contributing to poverty alleviation and the fight against diseases such as HIV/AIDS. There is agreement in both business and society that multinational corporations and their leaders have an enormous potential for contributing to the betterment of the world (WBCSD, 2006). Moreover, active engagement of corporations and their leaders in initiatives such as the Business Leader’s Initiative on Human Rights (BLIHR), the World Business Council for Sustainable Development’s (WBCSD) “Tomorrow’s Leaders Group”, or the Global Business Coalition on HIV/AIDS may be seen as an indicator for a growing willingness among business leaders to spend time, expertise and resources to help solve some of the world’s most pressing problems by engaging in problem alleviation at the local level, especially in developing countries where the problem impact is most severe.
