Written by
Christo Nel

Published
15 Oct 2015

The principles of stewardship

15 Oct 2015 • by Christo Nel

What does stewardship involve?

Elements such as sustainability, corporate social responsibility, shared economic value, and caring capitalism are all sub headings to the overarching theme of stewardship, and are fast becoming staples of global political agendas.
 
It is not too long ago that the dominant world views were often over simplistically divided into the polarities of capitalism and communism/socialism. But as one commentator defined it, “Capitalism didn’t win; communism just lost first!” Within this polarity of thinking, stewardship seeks a third way forward. It consciously avoids the false conflict between viewing humanity as either an economic being in which people seek to fulfil their own largely exclusive interests, and humanity as a communal being in which the interests of the whole prevail over that of the individual.

Stewardship creates a bridge between these extremities by integrating these opposing views to create a third alternative where we shape our actions in ways that benefit the interests of all members of the communities we work and live in. 

What is the real role of business?

Within the context of business, it means managing organisations in ways that best contribute to the fulfilment of all stakeholder interests. This seriously challenges the ethos of Nobel Laureate in economics, Milton Friedman, who claimed that the only real role of business is to serve the interests of shareholders. In their best seller, 'Firms of Endearment', Sisodia, Seth and Wolfe challenge the assumption that the purpose of business is to maximise profits and generate returns for shareholders. Instead they present shareholders as only one of several key stakeholders; workers, suppliers, customers, managers, and the entire community within which the business operates. Their research demonstrates that instead of maintaining the belief that there must be inevitable trade-offs between serving the interests of some stakeholders at the cost of others, companies which actually deliver superior performance in the medium-to-long term care deeply for all stakeholders. 

The essence of stewardship can be found in the principles of collaboration; high involvement management practices, valuing diversity, and creating environments where multiculturism thrives. Stewardship respects the interests and perspectives of others and hence ensures that people are informed about the things that may affect them. But, more importantly, it requires involving people in the actions and decisions that could have an influence on their lives and work. Stewardship is thus deeply rooted in values of transparency, respect, engagement, and tolerance for diversity of views and of culture, in short everything that the modern workforce aspires to today.

What happens when stewardship is not present?

Perhaps the most compelling argument for promoting stewardship can be found in the acts that led to the collapse of Enron and Lehman Brothers, and more recently by the conscious attempts of Volkswagen to cheat emissions testing for millions of their vehicles. These lapses in management and leadership that have led to such economic disasters are rooted in selfishness and rejection of the holistic nature of existence – the opposite of what stewardship represents.

One benefit is that these events have provided a catalyst for change. Following the financial crash of 2008 many business schools took greater steps to ensure their graduates re-entered the workforce instilled with a sense of how to act responsibility both for themselves and their organisations, but for the wider community.

However, more can be done. At Nyenrode, we’ve strived through our teachings and our actions to create social change for social good. The institution is built on three key pillars; leadership, entrepreneurship and stewardship. I firmly believe that successful leadership or entrepreneurship cannot exist without a commitment to stewardship. 

In our increasingly interconnected and globalised world the call for stewardship is becoming one of the most vital values and deeds that leaders need to embrace and live so that we can create sustainable organisations that operate as extensions of society, and contribute to the upliftment of the communities within which they operate.