The Integrative Justice Model as a Framework for Sustainable Development

1. The Integrative Justice Model as a Framework for Sustainable Development Nicholas Santos, S.J. Gene R. Laczniak Presented by: Tom Bausch Marquette University, Milwaukee, USA June 2009 IAJBS – 15th World Forum, XLRI – Jamshedpur, India

2. Sustainable Development • Brundtland Report of the World Commission on Environment and Development (1987) • development that meets the needs of the present without compromising the ability of future generations to meet their own needs • Copenhagen Declaration at the World Summit on Social Development (1995) • economic development, social development, and environmental protection are interdependent and mutually reinforcing components of sustainable development • Johannesburg Declaration at the World Summit on Sustainable Development (2002) • poverty eradication, changing consumption and production patterns, and protecting and managing the natural resource base for economic and social development are overarching objectives of and essential requirements for sustainable development

3. The Integrative Justice Model (IJM) • Normative ethical framework for marketing to impoverished market segments • Constructed using the normative theory building process in philosophy proposed by John Bishop (2000) • Integrates the notion of “fairness” or “equity” in marketing transactions as developed in different strands of thought in moral philosophy and management theory • Uniqueness of the IJM: well-grounded, logical, consistent, and systematic model

4. Frameworks covered • Virtue Ethics • Ross’ Theory of Duty • Habermas’ Discourse Theory • Kant’s Categorical Imperative • Rawlsian Theory • Classical Utilitarianism • Sen’s Capability Approach • Stakeholder Theory • Triple Bottom Line Approach • Sustainability • Socially Responsible Investing • Service-Dominant Logic of Marketing • Catholic Social Teaching

5. Key Elements of the IJM • Authentic engagement with consumers, particularly impoverished ones, with non-exploitative intent • Co-creation of value with customers, especially those who are impoverished or disadvantaged • Investment in future consumption • Interest representation of all stakeholders, particularly impoverished customers • Focus on long-term profit management rather than short-term profit maximization

6. IJM elements – Theoretical support

7. Sample derivation of IJM element: “Authentic engagement with non-exploitative intent” • 2nd formulation of Kant’s categorical imperative decrees, “never treat a person as means to an end merely”. • The “difference principle” of John Rawls implies that actions, policies and procedures not make those least well off, worse off. • One of Ross’ “prima facie” duties is beneficence which suggests rendering aid to those in need whenever reasonable. • Stakeholder theory recognizes the claims of all those affected by the organization not to bear the cost of negative externalities caused by the actions of the firm. • The 3BL measurement of company performance includes “social sustainability “ as part of its business model; sustainable exchange is typically fair to both parties. All of these frameworks are suggestive of treating consumers, especially vulnerable ones, with fairness and without exploitation.

8. The IJM and sustained profitability • 5th element of the IJM – long term profit management • Taking the “long view” in the oversight of financial rewards – integral part of the CSR movement • Amartya Sen & John Rawls – moral underpinnings and justification of long-term approach especially regarding poor consumers • Foregoing extraction of profits in the short run can lead to beneficial exchange with impoverished segments far into the future

9. The IJM and sustained societies • 3rd element of IJM – investment in future consumption • Vast number of people who live in poverty with little or no access to basic healthcare, nutrition, sanitation, education etc. – indicative of an unsustainable society • Investment in future consumption – more than merely proposing a budget for increasing consumption • Ties in with Sen’s idea of expanding the capabilities and freedoms of people • Attempt at procuring a better participation of the impoverished in the market system (as producers, innovators, employees, distributors, customers etc.) • Case examples: • Toyota University (India) • Investec (South Africa)

10. The IJM and sustained ecosystems • 3rd element of the IJM – investment in future consumption without endangering the environment • One of the fears of expanded marketing to impoverished market segments – dire consequences of increase in overall consumption on the planet • Major assumption made is that present production patterns will also be used in future to support increased consumption • This need not be the case • Biotechnology – more sustainable agricultural practices • Disruptive innovations – enable more people to have access to the fruits of development while helping to preserve the environment

11. The IJM and sustainable labor • Impoverished markets – ability to purchase on an ongoing basis only possible with the continued presence of viable employment opportunities • Two common entry-level economic transactions in impoverished markets • Micro loans • Fair trade production • Micro loans – helps create a labor driven “business activity” that will help repay the loan and provide basis for future consumption • Fair trade production – intended to establish an economic climate that allows for continuation of business activity in a manner that assures future disposable income for these workers • Exploitation of workers diminishes likelihood of future consumption • Sustainable wages contributory to future economic engagement by the poor (“investment in future consumption” may commonly be implemented by “investment in labor”)

12. Pedagogical implications of the IJM • Key elements of the IJM complement core elements of conventional models of economic growth with a long-term sustainability perspective • Significant pedagogical challenge in Jesuit Business Schools: bridging the chasm between conventional models of economic growth and sustainability • In most Jesuit Business Schools – compartmentalization of courses that are exclusively focused on profit generation and those dealing with social responsibility, business ethics or the environment • In postulating a normative ideal, the IJM implicitly informs the distinctiveness of courses taught at Jesuit Business Schools • Consistent with the IJM all courses taught at Jesuit Business Schools could promote an authentic engagement with customers, co-creation of value, investment in future consumption, interest representation of all stakeholders, and a focus on long-term profit management • Precise pragmatics of implementation and setting forth of actionable guidelines – tasks that Jesuit Business School faculty can best attend to

13. Thank you