...Rethinking the Social Responsibility of Business From Reason (October 2005) Making Philanthropy Out of Obscenity -Milton Friedman By pursuing his own interest [an individual] frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. -Adam Smith, The Wealth of Nations The differences between John Mackey and me regarding the social responsibility of business are for the most part rhetorical. Strip off the camouflage, and it turns out we are in essential agreement. Moreover, his company, Whole Foods Market, behaves in accordance with the principles I spelled out in my 1970 New York Times Magazine article. With respect to his company, it could hardly be otherwise. It has done well in a highly competitive industry. Had it devoted any significant fraction of its resources to exercising a social responsibility unrelated to the bottom line, it would be out of business by now or would have been taken over. Here is how Mackey himself describes his firm's activities: 1. "The most successful businesses put the customer first, instead of the investors" (which clearly means that this is the way to put the investors first). 2. "There can be little doubt that a certain amount of corporate philanthropy is simply good business and works for the long-term benefit of the investors." Compare this to what I wrote in 1970: "Of course, in practice the doctrine of social responsibility...
Words: 3771 - Pages: 16
...Organizational Behavior at Whole Foods Introduction This paper will discuss the organizational behavior concepts that relate to Whole Foods. These concepts include Theory X and Theory Y, human and social capital, the profile of the 21st century manger, Carroll’s Global Corporate Social Responsibility Pyramid and the seven moral principles. Whole Foods Market is a supermarket chain that functions through several completely maintained divisions. The supermarkets are located in the US, Canada and the UK. It is headquartered in Austin, Texas and employed about 72,700 people as of September 30, 2012, of whom 16,400 were part-time employees and 3,200 were seasonal employees (“Company Profile”, 2013). McGregor’s Theory Y Role at Whole Foods In 1960, Douglas McGregor wrote The Human Side of Enterprise, which framed two sets of molds about human nature. The first one is Theory X is unenthusiastic and negative. It assumptions people don’t like working and must be forced to do their work, avoid responsibility and have little motivation. As Kopelman and et al. (2012) stated “the manager who holds Theory X beliefs may unwittingly engineer a low level of employee motivation and (ironically) lament to a colleague that you can't get good workers nowadays” (pg. 451). Theory Y is the counterpart. In this Theory, mangers assume employees can be self-motivated, committed, responsible and creative workers. Whole Foods hires people that are well-trained who flourish in their workplace...
Words: 1293 - Pages: 6
...Company Analysis: Whole Foods Market Introduction Whole Foods Market is American supermarket chains headquartered in Austin, Texas. Today, the company is the world’s leader in selling natural and organic foods and has more than 360 stores in the North America and the United Kingdom (Whole Foods, Inc. 1). As a company, they seek the finest goods available, while maintaining the most faithful quality of natural and organic food items. In essence, they have an impeccable commitment to sustainable agriculture. Their motto is “Whole Foods, Whole People, Whole Planet” (Whole Foods Declaration). The company markets food products and dietary supplements along with body care items, articles of clothing, educational books and household items which include furniture, carpets, lighting, etc (Whole Foods, Inc 1). Some of their specialty items are meat, fish, cheeses, wine, vitamins, vegetables, fruits, prepared meals, animal nutrition products (Whole Foods, Inc 1). The company has an overall good reputation when it comes to customer’s health and diet. With the expansion of the Whole Foods Market, organic food is becoming more popular in families’ kitchens across the globe. One might wonder what contributes to Whole Food Markets nationwide success. As a whole, ethics, social responsibility, sustainability, competitive advantage, technology and innovation are some of the contributing factors to Whole Food Market’s success. Application of Chapter Concepts Ethics One of the factors that...
Words: 2273 - Pages: 10
...Whole Foods Market Social responsibility means that an ethical framework that suggests that an entity, be it an organization or individual, has an obligation to act to benefit society at large. There are many actions can be considered as Social responsibility like Philanthropy, Environment ,Ethical labor practices and so on. One of the example of social responsibility organization is Whole Foods Market, Inc. Whole Foods supports sustainable agriculture, and they promotes the reduction of waste.They also encourages environmentally sound cleaning and cut down consumption of nonrenewable resources. The company created the Local Producer Loan program, which provides $10 million as low-interest loans for small local producers to grow their businesses. The best social responsibility that Whole Foods Market provide is giving back to the global community. Whole Foods works to reduce hunger and poverty around the globe by offering them jobs. Grgurich (2012), "The Whole Planet Foundation, a partnership between Whole Foods Market and Nobel Prize winners Muhammad Yunus andGrameen Bank, provides grants to microfinance institutions in Latin America, Africa and Asia, which provide loans, training and other financial services to the self-employed poor." Whole Foods Market is a trust brand because, it likes the relationships we have with friends and family. They are doing their social responsibility to the world and society. Not just focusing on their own business. The reason why Whole Foods...
Words: 280 - Pages: 2
...largest retailer and successful retailer in US market that offer low prices to customer. Wal-Mart is a company that focuses on it shareholder. Wal-Mart most definitely makes shareholder money. Since the establishment, Wal-Mart has served the public interest by creating wealth, primarily by selling worthwhile goods and services for a profit. This encourages Wal-Mart expand their business to international markets. Today, Wal-Mart’s customer base no longer targets only low income customers and has expanded into targeting African-Americans, the affluent, empty-nesters, Hispanics, suburbanites, and rural residents. As such, Wal-Mart took a holistic approach to changing its mission statement to “we save people money so they can live better” to appeal to a broader customer base. By expanding the target customer base, the retail giant has strategized to appeal to a mixed demographic which out performs other rivals. Wal-Mart’s net sales over the last 3 years have increased consistently with an increase in 2012 of 5.9% year over year. Wal-Mart’s performance and shareholders are inter-related, shareholders are concern about company performance because it will affect shareholders interests if company not doing well in their business. Wal-Mart main focus is to uphold and maintain it responsibilities to shareholders and follows free the market libertarianism model. Milton Friedman model was that Corporate Social responsibility a corporation to provide profit for it shareholders...
Words: 4698 - Pages: 19
...Organizational Behavior 18 February 2013 Belief and Support of Human Capital: Case Study Analysis of Whole Foods What role, if any, does McGregor’s Theory Y play at Whole Foods? Explain? The primary focus of this case study analysis shall be to examine the methods of Whole Food’s distinctive approach and development to the implementation of creative management strategies and how they can continue to successfully help them to maintain growth in their company. The underscoring premise of McGregor’s Theory Y primarily rest on the assumption that that the role of management is develop the potential of their employees and help them to realize their potential to meet the common goals of their organization (Steward, 2010). With this underlining thought in mind McGregor’s Y Theory plays an intricate and crucial role at Whole Foods. According to our textbook, Organizational Behavior, by Robert Kreitner and Angelo Kinicki, and the company’s primary mission directives, Whole Foods goal is for upper management to share the responsibility with their frontline managers in the development of a successful work environment (Kreitner & Kinicki, 2013, p. 30). Whole foods promotes their employee teams to be self-directed and take initiative and responsibility for operating together for the benefit of their entire business organization. To this end John Mackey, Cofounder and Co-CEO of Whole Foods Market promotes through the application of McGregor’s Theory Y the happiness and growth of all employees...
Words: 1242 - Pages: 5
...associations have taken active interests in introducing corporate social responsibility policies to gain more benefits. CSR continues to play a significant role in meetings and other leisure industry programs throughout 2011. The most typical example for CSR used into meeting industry is sustainability event or green meeting, which incorporates environmental considerations to minimize its negative impact on the environment. CSR might be a competitive distinction for a company compete with other both events corporate and business meeting companies who they with “similar products and services aimed at the same customer group.” As the CSR have been introduced by meeting associations , there is a big environment impact on the whole meeting industry. Regulation in corporate itself will cover each detail of a corporation's operations in different aspects. More and more meeting and conferences will use social awareness as a advertise to win public support in global markets, helping them improve competitive position and innovation. A strong commitment to CSR affect employee attitude. Moreover, businesses and corporate get opportunities to foster the business development from CSR in meeting market. Definition Corporate social responsibility literally is corporation's corporate self-regulation and interaction with society and a duty to society in general. The goal of CSR policy is to build responsibility for the company's actions and encourage a positive...
Words: 1616 - Pages: 7
...SOCIAL RESPONSIBILITY: WHY IT’S THE RIGHT THING TO DO “Being socially responsible means that people and organizations must behave ethically and with sensitivity toward social, cultural, economic and environmental issues. Striving for social responsibility helps individuals, organizations and governments have a positive impact on development, business and society with a positive contribution to bottom-line results,” (http://www.imasocialentrepreneur.com/social-responsibility/). In layman’s terms, corporations have a responsibility to serve the community while providing goods and services and making a profit. Business Law author Henry Cheeseman identifies the four theories of social responsibility as: a) maximizing profits, b) moral minimum, c) stakeholder interest, and d) corporate citizenship. In order to comply with social responsibility standards, all requirements must be met. Unfortunately, not all business owners feel obligated to be fully socially responsible. T.J. Rodgers, founder and CEO of Cypress Semiconductor, is one who does not. His primary interests are in maximizing profits and stakeholder interests. Whole Foods CEO John Mackey, on the other hand, fully grasps the idea of and practices all aspects of social responsibility. There are legitimate arguments for and against businesses performing social responsibility activities. The strongest argument in support of social responsibility is that because businesses have such a profound impact on their communities...
Words: 1568 - Pages: 7
...Case Analysis #1 Whole Foods Market Vision, Core Values and Strategy Introduction Whole Foods Market was founded in Austin, Texas, when four local businesspeople decided the natural foods industry was ready for a supermarket format. The founders were John Mackey and Renee Lawson Hardy, owners of Safer Way Natural Foods, and Craig Weller and Mark Skiles, owners of Clarksville Natural Grocery. The original Whole Foods Market opened in 1980 with a staff of only 19 people. It was an immediate success. At the time, there were less than half a dozen natural food supermarkets in the United States. By 2006, Whole Foods Market had evolved into the “world’s largest retail chain of natural and organic foods supermarkets.” Their rapid growth and success was primarily due to being highly selective about what they sell, as well as being dedicated to quality standards and core values. Whole Food’s stated mission statement was to “promote vitality and well-being for all individuals by offering the highest quality, least processed, most flavorful natural and naturally preserved foods available.” Whole Foods Strategy Strategy formulation is vital to the well-being of a company or organization. There are two major types of strategy, corporate strategy and business or competitive strategy. Corporate strategy, in which companies decide which line or lines of business to engage in and business or competitive strategy, which sets the framework for achieving success in a particular...
Words: 2609 - Pages: 11
...also certify that this paper was prepared by me specifically for this course. Student's Signature: _____Kandis D. Gaines_________________________ ***************************************************************** Instructor's Grade on Assignment: Instructor's Comments: Business Ethics and the Moral Foundation of Effective Leadership Introduction In the global business spectrum, ethics play a huge role within any form of business where key ethical principles such as morals, values, and judgment determine the overall success and direction of the company. Managers and entrepreneurs who make moral determinations behind ethics build trust and create positive relationships with their employees, consumers, and investors. This form of ethical behavior leads to substantial growth for the corporation along with maximizing profits and building a great reputation. Ethics in business is the upmost importance in keeping a company stable and an essential component to a successful and effective long term business leadership. When making business decisions, organizational leaders who fail to remember,...
Words: 4948 - Pages: 20
...Whole foods wants to hire leaders who are conscious leaders (Core Values). They want to be there to serve the company, other employees, and themselves. This seems to be what McGregor's Theory Y is all about. The text says that theory y employees are committed, energized, and responsible(Kreitner& Kinicki,2013). They also want to serve the organization as well as the organizations purpose. Happy employees results in happy customers. At Whole Foods, I am sure that need creative management so that employees do not become unhappy or feels “stuck” at work. If employees feel as if they are part of a company, they are more likely to be happy. John Mackey’s follows McGregor’s theory y concept because his employees are happy and provide top notch customer service. Theory y managers are easier to teach than theory x managers. Whole Foods prides itself in employee training and keeping them up to date on current issues and technologies that better the company. Whole Foods builds human and social capital in several different ways. Like most companies, they hire and train their employees to be knowledgeable in a specific product or service area. Team members then work directly with team leaders to make decisions regarding their specific area as well as contributing to store decisions as well (Core Values). When it comes to social capital, Whole Foods focuses on sustainable agriculture. It is emphasized to the point that whole foods launched a loan program to help local independent producers...
Words: 1204 - Pages: 5
...Whole Foods Market History Whole Foods Market was founded in Austin, Texas, when four local business people decided the natural foods industry was ready for a supermarket format. The founders were John Mackey and Renee Lawson Hardy, owners of Safer Way Natural Foods, and Craig Weller and Mark Skiles, owners of Clarksville Natural Grocery. The original Whole Foods Market opened in late 1974, it was an instant success. At the time, there were less than half a dozen natural food supermarkets in the United States. They have grown by leaps and bounds since the first store opened. The first Whole foods supermarket opened in New Orleans in 1974; with only staff numbers 19 employees, it was a huge success and made $1 million. Business ethics- is a form of professional ethics that examines principles and moral or ethical problems that occur in a business environment. It applies to all aspects of business conduct and is relevant to the conduct of individuals and entire organizations. Business ethics in the whole food market are very welcoming because they have high principles and respect new businesses to come in to their store to sell your products, also this market care for communities Benefits the company- The benefits of the company through business ethics are that they gain a good reputation from being honest to their customers and showing the customers that they can be trusted. By following business ethics they get respect from everybody who assoiled with their business also get...
Words: 2194 - Pages: 9
...Core Values and Strategy, Organizational Behavior and John Mackey CEO at Whole Foods Market 2013 A Case Study J H W State College This paper was prepared for Organizational Behavior September Semester, taught By Professor Core Values and Strategy, Organizational Behavior and John Mackey CEO at Whole Foods Market 2013 Introduction This case study research investigation will evaluate the organizational behavior theories and John Mackey’s Management concepts of Core Values and Strategy “Conscious Capitalism” approach at Whole Foods Market. The five organizational behavior theories that were chosen for this study are; Theory X/Y , human and social capital, the profile of the 21st century manager, Carroll’s Global Corporate Social Responsibility Pyramid, and the seven moral principles. Whole Foods Market was founded in Austin, Texas, by four businesspeople that decided the natural foods industry was ready for a supermarket. The original Whole Foods Market opened in 1980 with a staff of only 19 people and became an overnight success. Most of the success was attribute to the quality standards, a devotion to community and environmental responsiveness, a healthy growth model and highly-regarded employment practices. What Role Does McGregor’s Theory Y Play at Whole Foods? Theory Y believes employees are proficient in setting goals on their own; they can do it with little to no guidance from others. They are responsible, willing to take on new...
Words: 1505 - Pages: 7
...Whole Foods Market Corporate Social Responsibility Whole Foods Market prides itself on their Corporate Social Responsibility. They do not have a written initiative in place but do have many aspects of it on their website. They are very much into the community, the environment sustainability. One way they benefit society is by supporting organic farmers. The government does not subsidize the organic farmer like they do the non-organic farmer making it harder for them to make a profit. The non-organic farmer uses 1.2 billion pounds of pesticides each year. The organic farmer uses no toxic chemicals. By supporting the organic farmer, they are helping to keep the air we breathe, the water we drink and the food we eat clean. This is why they can state in their mission statement that they are “selling the highest quality natural and organic products available.” Whole Foods Market was one of the first American companies to sign on to participate in the Marine Stewardship Council. This Council promotes sustainable fisheries and responsible fishing practices worldwide to help preserve fish stocks for future generations. Whole Foods will only sell fish with the Marine Stewardship Council (MSC) label. This lets the Whole Foods Customer know that they are supporting seafood sustainability by buying these seafood products. This also lets the customer know that Whole Foods has taken their pledge of quality food seriously. Whole Foods Market gives over 5% of their total net profits...
Words: 519 - Pages: 3
...Whole Foods Market [ACTG 4760 Case Project 1] [Xiaofei Liao] History of Corporate Governance at the Firm Whole Foods Market was founded in Austin, Texas. 1980, with merely 19 people. There are four founders of the company, John Mackey, Rene Lawson Hardy, Craig Weller and Mark Skiles. John and Renee dropout from college and borrowed a total of $45,000 from their families and friends to open Saferway Natural Foods. Two years later, the couple partnered with Craig and Mark, owners of Clarksville Natural Grocery, to merge Saferway with their Clarksville. This action resulted the opening of the original Whole Foods Market in 1980. Whole Foods goes public in January 1992, trading shares on the NASDAQ Stock Market as WFM. It has become a public company for 23 years since then. The Appendix A shows a list of key dates in the development history of the company. Today, there are over 410 stores of Whole Foods throughout the United States, U.K., and Canada. There are more than 88,000 team members and the company is awarded as “100 Best Companies to Work For” by FORTUNE magazine for 18 years since the list’s inception. It listed 218 in the Fortune 500 list and all the accomplishments by Whole Foods ties closely with its strong corporate governance policies, including the Board, its Committees and the individual directors. Roles and recent challenges of the Board The Board of Directors is responsible for monitoring management’s operation...
Words: 1899 - Pages: 8
