Washington D.C., Oct 7, 2014 / 04:09 pm .- Business leaders should embrace virtues like solidarity and mutual dependence among their business partners, employees, customers and broader communities in order to bring wealth to everyone, a Catholic businessman said.
“As Catholics, we must not merely speak words like solidarity – rather, we need to think deeply about what they mean for us, in our personal lives, and how we embody them as we go about our daily business in society,” Frank J. Hanna III, the CEO of Hanna Capital, told CNA.
Hanna was among the speakers at The Catholic University of America’s conference “Liberty and Solidarity: Living the Vocation to Business.” The conference, co-sponsored by the California-based Napa Institute, took place Sept. 24-26.
Hanna emphasized that business men and women cannot separate their professional lives from Christian virtues.
“A free market, when engaged in by people acting in a virtuous manner, is a place where everyone who trades becomes wealthier,” he said in his Sept. 24 talk at the D.C. conference.
While a Christian businessman “must not neglect the dollars,” he or she “must actually conduct himself as if something else has priority,” he stated.
Hanna rejected the valorization of independence. Rather, he said, human relationships are strengthened through decreasing one’s independence and increasing one’s dependence. He noted as an example the dependence between family members at different times in their lives.
A similar dependence is also relevant in business, he said.
“The business partnerships that prevail are the ones where both partners need one another,” he explained.
When both participants in a trade act “in a virtuous manner,” they leave the market “with a greater degree of well-being, a greater amount of wealth, than they had prior to entering the market.”
He suggested that “flourishing human relationships” are the best at creating wealth and advancing well-being. He noted that it is hard to measure the quality of these relationships, and that while efforts to measure well-being in dollars can be relevant, they are “a very poor proxy for real wealth.”
Defining wealth in “a narrow, materialistic manner” leads to the view that business exchanges do not result in mutual wealth, he suggested.
Hanna also rejected claims that some vices are an “inherent feature” of the market, saying that he first encountered sins like “betrayal, greed, selfishness, materialism, cheating, narcissism, rudeness” on the playground as a child, not after he entered business.
While businesses want their customers to be dependent on their products, they are also dependent on their customers, he noted.
In the market, Hanna suggested, one’s level of dependence is “probably correlated to the amount of additional wealth created by that dependence.”
He noted that people have become dependent on cell phones because they “enhance our well-being, our wealth.”
In Hanna’s view, the best businesses are grateful for their dependence on their customers and are “more likely to create the kind of value for that customer such that the customer becomes dependent on them.”
This also applies within business partnerships. Hanna cited the work of Economics Nobel Laureate Ronald Coase, who proved that long-term partnerships and cooperation yield greater joint economic productivity.
Hanna said he has found this to be true in his own 25-year partnership with his brother. They both emphasize to potential business partners that they desire long-term business relationships that can last decades.
Hanna said that value creation is a way of cultivating dependence. He said he recommends that new graduates “constantly be focused on creating value for others.”
He rejected theft, swindling, and winning at gambling as legitimate paths to obtaining money, compared to receiving money as a gift or receiving money in exchange for value.
Delivering value is “other-directed” and requires that a person “put aside our selfish desires and focus on the needs of someone else,” Hanna said.
He stressed the need to strengthen human relationships and human flourishing in one’s home and community.
“Even before saving our own parishes or workplaces, we have to ask: are we saving our own families?” he said.
Solidarity and human relationships require “time and presence,” which must be cultivated through “staying still and silent.” Modern habits of mobility affect solidarity, he noted.
“We will not have solidarity in our society if we do not have it in our neighborhoods and our parishes and our workplaces, and if the turnover in each of those specific geographic locations passes the tipping point, each of them becomes more like a train station or an airport, rather than a home.”
He said corporations and employees don’t feel loyal to one another when they have not developed solidarity within their own communities.
Hanna cited Pope Francis’ encouragement that bishops must “live with the smell of our sheep,” adding that this advice can be applied to business leaders. He said business leaders must know not only their customers, employees and co-workers, but their own families in order to live a full life.