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Milton Freidman vs. Whole Foods on Reason.com

| Tuesday December 20th, 2005 | 5 Comments

the social responsibility of businessIf you’ve ever grappled with the concept of Corporate Social Responsibility, you’ve undoubtedly encountered a certain degree of cynicism along with naivete. You may also recall Milton Friedman’s famous quote “the Social Responsibility of Business Is to Increase Its Profits” which is precisely the way many business people think about it. But check out this fantastic exchange between Friedman and Whole Foods Founder John Mackey at ReasonOnline.
Mackey’s take on Friedman’s vision is that it’s simply too narrow and basically old fashioned. Friedman says Mackey is just adding fluff to what is basically the same philosophy he has. I think it’s mostly a language barrier, and a matter a of exactly how you define “profit”. Must the word “profit” always refer to money in the strictest sense? It’s certainly a lot easier to quantify that something like “happiness”, but the intangible benefits of good, honest business clearly go way beyond pure finance. The question is, must we obsessively try to quantify it somehow, or is there language that can describe it accurately enough in non-abstract terms to arrive at some sort of agreement?
Check out the exchange, it’s very thought provoking.


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  • http://www.getoutdoors.com/goblog/ climb_ca

    Great artcle. Rodgers comments are not even worthy of discussion. Friedman disappoints as well, but for different reasons. With all
    due respect to his Nobel prize, you would have hoped his wonderfully “textbook” and parochial view of the world would have changed in his old age. Alas no, he’s about as progressive as a Trappist Monk. And at least they make good beer. Too much time in his ivory tower perhaps. Yesterday’s article
    in the NY Times
    observing that the wealthy donate disproportionally less than those with smaller incomes is a perfect example of the flaw in Friedman’s argument that the private sector is a more efficient allocator of social capital. It would seem from the study quoted in the article that the most wealthy are the least likely to allocate their “social capital.” They seem to be more interested in pursuing tax breaks and Hummers than tackling the real social problems facing the United States. Regardeless, thankfully there are progressive business men and women like John Mackey, Paul Hawkens, Ray Anderson, and Yvon Chouinard. Let us hope that some day undergraduates and graduates alike know their names as well as they know Friedman’s. And let us hope that their visions, not Friedman’s or Rodgers’, prevail.

  • http://www.ethicaladventures.org beev

    Thanks for that link, 3P. A really good read!

  • http://www.ethicaladventures.org beev

    Thanks for the link, 3P. A really good read!

  • http://commonground.typepad.com Enrique

    Friedman vs CSR, that’s so last month. Keep in mind Whole Foods thrives on convincing consumers to pay more for lux goods, matching high ideals with high incomes.
    http://commonground.typepad.com/com monground/2005/11/tree_huggers_vs.html#trackback

  • green LA girl

    Reading this makes me more curious about Mackey and his biz strategies. My friends’ve heard him say at green conferences that fair trade’s a marketing gimmick, for ex. Is he a guy who’s great at using socio-environmental plans toward achieving biz profit ends? Or vice versa?

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