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Minka Woermann
Since the beginning of the twenty-first century, a number of developments pertaining to business ethics as both academic enterprise and practice have taken place on the African continent. To address properly the theme of business ethics in Africa, one should bear in mind the great social, political, geographical, and religious heterogeneity that characterizes the fifty-three countries that constitute the continent (Sheeran 2008, esp. 38). As such, this chapter presents a systematic consideration of business ethics within Africa. Taking into account that business ethics is both an academic enterprise and a matter of practical conduct, the presentation also draws attention to pertinent historical, cultural, and institutional considerations that serve to complicate such analysis.
Apart from heterogeneity, a second challenge to writing on business ethics in Africa is “that scholars have largely ignored Africa,” as revealed by a review (Parboteeah etal. 2013: 979) of leading business ethics and management journals. Praveen Parboteeah and colleagues argue that the lack of scholarship on Africa is “surprising given the growing importance of the [African] region in terms of global trade” (980). The dearth of literature on business ethics in Africa is most dire in the case of North Africa. For practical reasons, the focus of this chapter will thus be on the forty-four countries of sub-Saharan Africa (SSA), which is further divided into West Africa, Southern Africa, East Africa, and Central and Francophone Africa.
That there is little in the way of scholarly literature on business ethics in the African continent need not, however, imply that there is little in the way of practical business ethics or that there are not strong African traditions that may sustain a business ethics. Therefore, to provide a comprehensive overview of the topic at hand, three perspectives on the topic are explored.
The first and obvious approach (forwarded in the first section) constitutes a predominantly descriptive report on developments in business ethics in the different regions of SSA. Another frame of reference, undertaken in the second section, scans the development of business in Africa with specific reference to traditional African and Western influences. Despite the fact that Africa has inherited the business ethics language and tools from the West, the issues affecting the practice of business ethics in Africa cannot be separated from their unique contexts, which, in part, are shaped by historical forces. A third and final perspective delineates a normative response to African business ethics, premised on African culture, values, and business practices. As Augustine Shutte notes:
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there exists a characteristic indigenous ethical tradition or set of traditions in sub-Saharan Africa that has certain common characteristics . . . [and that] embodies ethical insights that are both true and important in themselves, and are also significantly lacking in the dominant ethical thinking in the global community.
(2008: 16)
This uniquely African ethical tradition is commonly referred to as Ubuntu. In the third section, the question of whether, and to what extent, Ubuntu could inform thinking on business ethics on the continent, as well as contribute to the formulation of global norms, is investigated.
Business ethics developments in Sub-Saharan Africa
Findings from the Global Survey on Business Ethics
In terms of academic business ethics, the first comprehensive and valid baseline study for Sub-Saharan Africa (SSA) was published in 2000 (Barkhuysen and Rossouw 2000). This study reveals that, at the time, business ethics was taught in six African countries, and that a total number of 167 publications on business ethics in Africa existed (of which 130 were articles and 37 were books or unpublished dissertations). In both teaching and research, the bulk of activity originated in South Africa, the focus of activities was on the micro and meso-economic levels,1 and the approach to business ethics was mostly descriptive or prescriptive.
When compared with this study, the report on Africa (Rossouw 2012) in “Global Survey of Business Ethics in Teaching, Training, and Research”2 (Rossouw and Stückelberger 2012) reveals that significant—if uneven—strides have been made by countries in the development of business ethics as an academic field in SSA since 2000. By 2010, there was evidence of business ethics-related academic activities in 20 Sub-Saharan African countries.3 A total number of 145 university courses,4 in which business ethics was taught at undergraduate level and postgraduate level, were identified, and the number of research publications5 for the period under review totaled 218.
The bulk of activity was reported in East Africa and Southern Africa. In Southern Africa, activity continued to be almost exclusively concentrated in South Africa, whereas East Africa was identified as the region in which business ethics-related activities were the most evenly dispersed across countries. In South Africa, business ethics is now an established field in higher education; whereas in East Africa, business ethics is finding traction in younger faith-based universities (where curricular reform is less onerous than in well-established universities), and the focus tends to be on ethics and civic education rather than on business ethics as such. This latter focus is mostly due to the fact that some states play a prominent role in promoting business ethics. The Ethiopian government, for example, has a Federal Ethics and Anti-corruption Commission (FEAC), which is heavily involved in business ethics teaching and training6 at both secondary and tertiary education levels.
Little activity in the field of business ethics was reported for West Africa and Francophone Africa. However, there is evidence that the discipline is beginning to develop more rapidly. The current emphasis in these regions is on strong advocacy7 in business ethics and good governance. The primary activity identified in these regions was that of research, as opposed to training and teaching (publications included non-academic documentation, possibly connected to the promotion of ethics and governance in the regions). Faith-based organizations (including NGOs and universities) again play a prevalent role in advancing the business ethics agenda.
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In terms of prevalent themes addressed in training, teaching, and research, Deon Rossouw notes that the emphasis continued to be on the meso- and micro-economic levels in SAA,8 and that a possible reason for this is that the high levels of corruption and corporate misconduct at all levels in SSA serve to focus the attention on issues of ethical management and leadership (including the subthemes of corporate governance and the prevention of corruption and corporate malpractice within organizations). This was particularly true of training in business ethics. In contrast, academic teaching (specifically at the undergraduate level) tended to be more focused on the theoretical frameworks that can guide ethical decision-making.
The strong focus on corruption and corporate misconduct also relates to the manner in which business ethics terminology is used. A peculiar feature regarding the usage of the term “business ethics” in SSA is that it implies the “business” of both the private and the public sectors (which, as previously mentioned, clarifies why the term “civic education,” as used in Ethiopia for example, is sometimes viewed as synonymous with business ethics). A first possible explanation, forwarded in the Survey by Rossouw, for this usage is that the state remains a key player in many African economies due to the high prevalence of state-owned enterprises. State enterprise is thus identified with market enterprises and so—in many instances—business ethics is a matter of state rather than private firms. In this sense business ethics offers a description and evaluation of current organizations, rather than a reflection on how private for-profit entities ought to conduct themselves. A second reason is that business ethics activities in SSA are closely associated with anti-corruption initiatives (such as corporate governance reform) and the improvement of ethical standards in both the private and the public sector. As argued below, governance reform is viewed as critical to conducting ethical business in Africa, and attention accorded to governance reform in both the private and public sectors points to a mutual “business” ethics agenda, despite the obvious differences between these sectors.
Governance reform in Sub-Saharan Africa
The academic business ethics agenda is closely related to governance considerations due to the manner in which the role of business enterprise is articulated in many governance regimes in SSA. The role of the firm is understood in terms of attending to a broad array of stakeholder concerns and interests, as opposed to being viewed primarily in terms of shareholder interests (as in the United States). Rossouw (2009) offers two hypotheses for why this may be the case: first, corporate governance regimes are embedded in larger socio-cultural systems, and, as such, reflect the values and norms of these systems. In Africa, the cultural and societal norms are more communitarian-orientated than is the case in the West, so the purpose of the firm is seen as extending beyond the interests of individual shareholders.9 Second (and as noted above), the socio-political environment plays a role in defining the purpose of the firm. In Africa most states have an active stake in enterprises, so the state’s socio-political priorities also influence the firm’s agenda. As such, African businesses operating in a post-apartheid or post-colonial context are expected to contribute to socio-political reform and development. As a consequence, the values according to which business ought to be conducted, and the interests that business ought to serve, cannot be isolated from the larger environment in which business operates or from the corporate governance regime underpinning that environment.
Apart from these normative considerations, it is also important to note that the goal of governance reform is to affect change in the economic (and political) environment(s). For this reason, governance reports and codes also provide concrete measures and guidelines for realizing ethical considerations, including defining the duties and responsibilities of the board and suggesting or prescribing measures for the active management of a company’s ethical performance. As such, governance concerns transcend the more specific normative and descriptive focus of academia by focusing on the operational dimensions of ethical business.
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South Africa’s corporate governance regime is representative of corporate governance on the African continent as a whole. South Africa’s corporate governance stance is set forth in the King Reports on Corporate Governance in South Africa. These reports constitute a set of corporate governance guidelines for South Africa. King I, specifically, represented an attempt “to reinforce the fundamentals of a capitalist corporate system . . . and a means of aligning the economy with international trends and imperatives” (West 2009: 11). The post-apartheid corporate environment was, therefore, modelled on the Anglo-American shareholder-centered model. Yet, even at this early stage, the state’s socio-political priorities served to temper businesses’ focus on shareholder interests in that several legislative statutes applicable to business,10 and passed in the 1990s and the subsequent decade (West 2009), are aimed directly at redressing economic inequalities stemming from apartheid.
Apart from these legislative statutes, the orientation of the King Reports serves to challenge the primacy of shareholders. The governance model promulgated in these Reports is an inclusive, stakeholder-centered model, which “considers, weighs and promotes the interests of all the company’s stakeholders” (IoD RSA 2009: 1.11). Andrew West (2009) concludes that South Africa’s corporate governance environment is most aptly described as “a modified Anglo-American model” (12): the orientation is broadly capitalistic but stakeholder interests and socio-political and socio-economic imperatives are also considered.
The inclusive stakeholder model is prevalent throughout SSA. Indeed, the only Sub-Saharan African country not to have initially followed the stakeholder model was Nigeria. However, in the 2011 revision of their 2003 governance code, emphasis was placed on management’s responsibilities towards employees and other stakeholders (SEC Nigeria 2011: 2.2.). Furthermore, and again following the example of South Africa, all the governance codes in SSA advocate a unitary board model11 and a self-regulatory approach, where companies are encouraged to treat their national corporate governance code or report as a guideline for ethical behavior (the “comply or explain” or “apply or explain” approach), as opposed to a set of legislated rules (the “comply or else” approach).
Although South Africa’s governance reports are heralded as world-class, James Khomba and Frans Vermaak (2012) question the appropriateness of using the King Reports as the model for governance regimes in the wider African context. In particular, they argue that corporate citizenship (as reflected in social and environmental corporate responsibilities) is often not fully embedded in the structures and systems of organizations or adequately represented at board level, stakeholder interests are not sufficiently accounted for, and power differentials and conflict is not considered. These issues lead the authors to conclude that “[g]enerally, corporate governance issues in Africa are in their infancy and are, therefore, transitional” (3513).
Apart from the practical problems pertaining to the inclusive stakeholder-centered approach, scholars also argue that the modified Anglo-American corporate governance model (that characterizes South Africa’s governance regime) may not be suited to other African countries, since these countries often do not reflect South Africa’s level of economic development. In this regard, West argues that:
many African countries do not have the size and sophistication of markets, or regulatory frameworks, for the concept of [regional] convergence to be meaningful. For many, the need for economic growth overshadows considerations of governance, and it is likely that the biggest influence on corporate governance in individual African countries will be their partners in trade and investment.
(2009: 15)
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The foregoing demonstrates that both practitioners and business ethicists need to take cognizance of the history and level of economic development and accepted cultural norms in order to ensure that business ethics teaching and governance interventions resonate with African contexts and the experiences of African people.
Business in Africa: contextual considerations and challenges
A consideration of the historical and economic context does not yield unique and incontrovertible conclusions. In this section, three competing theses on the link between business ethics and the development of capitalism in Africa are set forth, followed by an overview of current challenges affecting business and the business ethics agenda.
The development of capitalism in Africa
The three theses can be summarized as follows: The first holds that the values underpinning Western capitalism are fundamentally incompatible with African (economic) values, with the result that capitalism has not led to the economic successes witnessed in the West. The second thesis is that Africa inherited a dysfunctional form of capitalism from the West with the consequence that ethical business values are largely lacking in the post-colonial African context. The third thesis postulates that Africa’s current-day business ethics challenges are the result of a dysfunctional post-colonial political system, partly kept in place by Western aid.
Western economic liberalism arrived in Africa via several sources—colonialism, Islam, and Christianity. With that in mind, Munyaradzi Felix Murove (2005, 2009) explores the first and second of the above theses. In contending that economic liberalism is incompatible with African values, Murove draws on the work of John Iliffe (1983) and Paul Kennedy (1988). Iliffe’s (1983) argument is that economic liberalism is a consequence of the Christian influence, in that Christianity (particularly Protestantism) stresses individual as opposed to community salvation, and thus provides the genesis for the individualism that undergirds capitalism. Iliffe maintains that this emphasis on the ethics of individualism is foreign to traditional African societies and that, as such, “[t]here is very little indication that indigenous institutions aided the emerging capitalist” (52). Similarly, Kennedy (1988) argues that the entrepreneurial spirit, which is so central to the development of capitalism, is missing in Africa, in which the collective is prized over individual achievement. Like Iliffe, Kennedy also stresses the role of religion in sanctioning Western economic liberalism.
Although the strong liberal underpinnings of modern capitalism was absent in traditional African societies, George Ayittey, in contrast, argues that capitalism is “as African as the sunset on the savannah” (2009: 41). He states that in pre-colonial African capitalism the means of production were privately owned, but—unlike in the West—the basic economic and social unit was the extended family, as opposed to the individual. Ayittey offers the following description of traditional African economic life:
The family pools the resources of its members to produce agricultural products, the surpluses of which are sold on free markets at the village and regional levels. Here prices are determined by bargaining; they are not fixed by tribal chiefs or anyone else . . . Africans generally went about their economic activities on their own initiative and free will . . . In modern parlance, such people are called free enterprisers.
(2009: 40)
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Christine Gichure’s research affirms Ayittey’s account of traditional African capitalism. She notes that “[l]ocal trade was part and parcel of the social and food production systems that evolved amongst communities” (2006: 42). The manner in which local trade functioned curbed unethical behavior in that the continual need to barter for essentials, as well as social patterns and mores, limited groups and individuals from amassing large quantities of wealth at the expense of others; the payment of goods and services was determined by local customs; local trade facilitated the integrity of, and the interdependence between, groups; and wealth (in the form of livestock, wives and children, land, drums, trinkets) was on open display, which limited fraud and embezzlement.
Both Ayittey’s and Gichure’s accounts provide a challenge to the thesis that traditional African economics did not provide fertile soil for the development of capitalism (albeit that the particular Western flavor of individual liberalism does not have a good base in Africa). Furthermore, Gichure’s description of the social organization and norms structuring pre-colonial economic activities also provides a partial challenge to the second thesis, which holds that Africa’s current business ethical challenges stem from the fact that Africa inherited a dysfunctional form of capitalism from the West. This argument presumes that business (and the norms guiding business conduct) did not exist before the arrival of colonialism, which—as demonstrated above—is a contested claim. Nevertheless, there is no denying the fact that colonialism had an impact on Africa’s socio-economic landscape, and, as such, the second thesis—warrants investigation.
With reference to the second thesis, Murove (2009, 2005) argues that the Protestant work ethic did not find traction in post-colonial Africa, and, as a result, modern-day capitalism is all too often associated with “‘ostentatious consumption’ without production” (344). Yet scholars like Ali Mazrui (1986) lay the blame squarely at the feet of the colonialists, arguing that these early capitalists were responsible for severing the connection between commerce and ethics. He contextualizes this point as follows:
The aristocratic legacy of masters and servants had its adverse consequences for the work ethic in post-colonial Africa . . . White masters in Africa drinking their gin and tonic leisurely while their servants pulled off their boots—this was the colonial caste which transformed physical labour into a burden of servitude.
(233)12
Based on the above, Murove (2009: 225) concludes that post-colonial Africa inherited “the economic ethic of looting” from Western colonialists. Like Murove, Wayne Nafziger (1990) also draws attention to the negative socio-economic consequences of colonial capitalism, including general oppression and the destruction of indigenous institutions, religions, and cultures. Although colonialism paved the way to new sources of wealth creation and economic development, Nafziger notes that the majority of colonial investment was in infrastructure designed to promote trade with the colonizing country (mostly in mineral-related industries), that colonial expenditures were generally meager, and that the colonial legacy contributed to agricultural underdevelopment in the post-colonial period. Nafziger contends that as a result of rule by the West, forms of post-colonial capitalism are also still largely contingent on “the dependence of ruling classes on M.N.C.s, foreign aid and western military support” (150).
Ayittey downplays Africa’s colonial legacy in favor of an interpretation centered on the exploitation of the state by the ruling elite, coupled with misdirected development aid from the West. In this regard Ayittey writes that Africa “is not poor because of the residue of colonialism . . . [but] because its dysfunctional, kleptocratic politics have disorganized its societies, and Western countries and their aid vehicles have been unwittingly complicit in this” (2009: 37). On the questions of economic development one should consult also the work of William Easterly (2006), as well as the earlier and important studies of P.T. Bauer (1972, 1981).
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In elaborating on this third thesis, Ayittey argues that in failing to consider history and context, the global development elite have largely ignored the fact that African economies consist of three sectors operating according to distinct principles: namely the traditional sector, the modern or formal sector, and a transitional or informal sector. Even though the majority of Africa’s wealth is generated in the traditional and transitional sectors, development projects have focused almost exclusively on the formal sector, i.e., the regulated sector, in which companies are legally registered and (crucially) contribute to the tax base. Ayittey argues that this emphasis, coupled with corrupt political leadership, has strengthened what he calls “the artificial, parasitic African vampire state . . . [in which] Western-funded state enterprises became towering edifices of gross inefficiency, waste and graft” (2009: 39, 42). This enabled the ruling-elite—whom Ayittey depicts as “a gang of unrepentant bandits and vagabonds in Ray-Ban sunglasses and Italian suits” (42)—to enrich themselves and their tribes at the expense of their countrymen, sediment their positions of power, and lock out rivals, with the effect that a new system of economic apartheid has established itself in Africa. This system of economic apartheid has thwarted both local and foreign enterprise because the market cannot function properly in a context marred by unfair competition, opportunism, cronyism, rent seeking, and corruption.
Current-day challenges to business ethics in Africa
The foregoing discussion of some of the developments of capitalism in Africa already points to a number of structural features that mark the African business landscape as fundamentally different from that of the developed world (particularly the West). Consequently (and as demonstrated in the discussion on corporate governance regimes), the prevailing norms and issues that should be prioritized in African contexts may also be different from those of the developed world.
Although space does not permit an exhaustive analysis of pertinent issues or how and where they manifest themselves, an overview of the extant literature reveals that corruption and weak institutions, ethnic diversity, and economic pressures (which partly stem from Africa’s history of economic development) pose significant challenges to sound business ethics practices in much of Africa.
Corruption and weak institutions
Corruption is often seen as Africa’s number one problem, and the 2014 Corruption Perception Index conducted by Transparency International (TI) indicates that “the majority of [Sub-Saharan] African countries still have a score of less than 50 per cent, which . . . depicts a situation of endemic corruption” (Uwimana 2014: para. 1). Chantal Uwimana reports that the persistence of widespread corruption is one of the central features that prevent “the transformation of economic growth into development dividends for all citizens” (para. 2).
Opportunities for corrupt activity exist when a country’s macro-level institutional infrastructure is weak. This infrastructure is required for the enforcement of legitimate property rights (e.g., in some developing nations the poor cannot get a document of ownership), freedom of entry and exit into enterprises, non-confiscatory tax laws, predictable and non-onerous regulation, an impartial judiciary, and a sound currency—all of which contribute to sustainable business practices. When these macro-institutions are either non-existent, weakly enforced, or marred by corruption, business is weakened, which both undermines investment potential and reinforces the perception that it is impossible to do (clean) business in Africa. This point is widely recognized and, as a result, a number of Sub-Saharan African countries, including Nigeria, South Africa, Tanzania, and Uganda, have amended their anti-corruption legislation (TI, 2009).
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Strong macro-level institutional infrastructure not only safeguards business but also public interests. In Transparency International’s Global Corruption Report 2009: Corruption and the Private Sector,13 Jomo Kwame Sundaram (TI 2009: xx) notes that “[i]t is not uncommon for domestic firms and multinationals to pay bribes in order to secure public procurement contracts, nor unusual to learn of powerful corporate entities exerting undue pressure so as to capture institutions and influence regulations to elicit favourable investment conditions.” Corruption may extend beyond the practice of simple bribery and may include the taking of “any undue advantage, irrespective of value, results, perception of local custom, tolerance or alleged necessity” (TI 2009: 1119). Narayana Murthy (TI 2009: xix) further notes that in instances where corruption is rife, “[the] public trust in the beneficial partnership between business and society is gradually undone.”
In order to address private sector corruption, two elements are crucial: “the commitment and compliance systems of companies; and the rules, regulations and enforcements of governments” (TI 2009: 8). Enforcing good governance within companies (i.e., at the micro-level) ensures both that the risks associated with corruption within the organization are identified and addressed by corporate management, and that business responds effectively to the stakeholder networks that constitute the social and reputational contexts within which businesses operate at the meso-level. The responsibility of ensuring that the laws and institutions that constitute the macro-level business environment are legitimate, credible, and fair rests primarily with law makers and government regulators. The findings of the Global Survey (Rossouw and Stückelberger 2012) regarding the anticipated future focus of business ethics in SSA confirm that there is an increasing awareness amongst business ethicists of the significance of the macro-level business environment. As such, this environment is likely to constitute an increasingly important focus area for academic business ethics.
Ethnic diversity
Another challenge to general and equitable development has arisen, say some scholars, from the factionalization linked to ethnic groups. The problem or challenge is less one of ethnic diversity than of how ethnic identities have been used by colonialists and by current leaders to reward some and punish others. Praveen Parboteeah etal. report that misuse of ethnic diversity also has had “[a] dramatic impact on . . . economic development” (2013: 983), primarily through influencing national and business climates. According to Parboteeah etal., the political uses of ethnic diversity can be traced back to the “scramble for Africa,” during which time informal indigenous political systems were upended and spheres of influences were determined by colonial rulers. Often colonial rulers pitted different ethnicities against one another, and ethnic groups became competitive rather than cooperative.
In post-colonial Africa, this competitive behavior continues, and Parboteeah etal. (2013: 984) note that the perception too often exists that “only when a particular ethnic group has its own kind in political or organizational power, can it benefit from the nation’s or organization’s resources, hence increasing the phenomenon of ethnic identity.” There, thus, seems to be a connection between the valorization of ethnicity and cronyism. The widespread occurrence of ethnically-mediated cronyism in contemporary African politics confirms that this perception, however general, is not unfounded. Furthermore, others have noted that a strong emphasis on ethnic identity fuels “despotism, repression, state terrorism and manipulated ethnic hatred” (Ayittey 2009: 42), as well as xenophobic violence—all of which undermine economic stability and success.
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In their research on the ethical climates of companies in Africa, Parboteeah etal. (2013) further found that ethnic valorization is positively correlated with business climates in which “company norms support the satisfaction of self-interest at the expense of or with disregard to others” (981). Parboteeah etal. found that very few young people entering the labor force in Africa have faith that employment opportunities in the public and private sector will be allocated on merit rather than ethnic identity. This reinforces a corrupt business climate wherein who you know is more important than what you know.
Economic pressures
As developing nations, the countries of Sub-Saharan Africa are marked by widespread poverty and high levels of unemployment. Economic interests are thus paramount. Wayne Visser (2006) argues that due to the centrality accorded to economic interests in SSA, the social impact of business is primarily assessed in terms of business’s economic contribution. For this reason, and with reference to Archie Carroll’s (1991) influential CSR pyramid, Visser (2006) argues that in Africa, economic responsibilities trump all other responsibilities, and are highly prized by society. In order to discuss the extent to which these economic obligations are accepted by business, it is necessary to compare the trajectories of large formal enterprises with those of smaller firms and more informal modes of doing business.
In defining the scope of economic responsibilities, Visser notes that—as in Europe—the economic contributions of companies operating in Africa are more widely defined than is the case in North America, where the focus is on profitability and return to shareholders. In a 2014 policy briefing on governance in Africa, Terence Corrigan states that, in terms of governance, “[a] major African contribution to corporate governance thinking has been to entrench considerations of stakeholders’ interests in business operations” (2014: 2). However, the degree to which stakeholders (and their economic interests) are considered is contingent upon the depth of understanding of CSR practices. In this regard, Corrigan draws on economist and management expert Simon Zadek and his conceptions of three generations of CSR (2001). Corrigan summarizes the three notions as follows:
The first . . . [is] a form of philanthropy, sometimes ad hoc, dealing with social issues. The second involves a greater professionalism and the systematisation of initiatives—targets are set and progress reported, and CSR is integrated into planning. A third would see businesses taking a more active role in partnering with other elements in society to deal with overarching social problems such as poverty and environmental sustainability.
(2014: 2)
If Visser is correct in arguing that the social impact of business in Africa is primarily measured in terms of economic development (and, more specifically, in terms of “‘economic multipliers’” (2006: 38), including generative investment and income, safe products and services, job creation, human capital investment, local business linkages, the uptake of international business standards, technology transfer, and physical and institutional infrastructure development), then one could hypothesize that we are likely to witness a move towards second and (especially) third generation CSR, where business takes an active role in addressing overarching problems (including issues pertaining to socio-economic and equitable development).
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As previously argued, this broad stance to CSR is reflected in South Africa’s King Reports. However, drawing on research conducted in six Southern African countries (Lesotho, Mauritius, Mozambique, South Africa, Tanzania, and Zambia), Corrigan concludes that although “[i]n conception, Africa’s expectations of CSR are expansive . . . small, ‘first-generation’ activities may be all that is feasible for emerging businesses” (2014: 2, 4). It thus seems that, in many cases, economic benefits are merely incidental, and are not actively conceptualized in terms of corporate responsibilities, even though—in theory—the need to “reconcile economic growth with developmental benefits . . . is a growing strategic issue” (2014: 2).
Both the small and medium-sized enterprises (SME) and informal business sectors make up a significant part of the economic landscape in SSA, and, as such, the (potential) economic contributions of these sectors warrant investigation. Emmanuelle Lavallée and François Roubaud note that “operating in the informal sector is the rule rather than the exception [in SSA] and is not the result of recent systemic changes” (TI 2009: 412). They reference a 2002 World Bank discussion paper in which it is stated that Africa’s informal sector “is estimated to account on average 42 per cent of GDP in Africa in 2000” (Schneider 2002), although they also note that the size of the informal sector varies radically between countries. It stands to reason that factors that prevent the formal institutionalization of business also directly undermine CSR (defined in terms of economic imperatives) because many economic benefits—including taxation, investment, and safe products and services—are contingent on the registration and regulation of business.
Lavallée and Roubaud postulate that corruption may be one factor that perpetuates Africa’s informal sector. Yet, despite the size of this sector, Lavallée and Roubaud state that, to date, little comprehensive empirical research on the link between corruption and the informal sector has been undertaken. In order to generate some data on this link, the authors conducted a study of the informal sector in seven major cities in the Western African Economic and Monetary Unit. Their findings reveal that non-compliance in terms of legal registration of businesses has more to do with ignorance of the law and ineffective enforcement of registration requirements than with corruption (although Lavallée and Roubaud (TI 2009: 414) also report that paying bribes for non-compliance “is a significant means for settling disputes with public agents”).
As with the informal sector, SMEs also play an important role in SSA and, as such, it is worthwhile to investigate the extent to which they embrace CSR. Mollie Painter-Morland and Kris Dobie’s research indicates that these businesses are perceived by many as the “engine of the economy” (2009: 9), and are generally viewed as being in a much closer relationship to their communities than is the case with big business. However, Painter-Morland and Dobie also note that many SMEs believe themselves to be operating in survival mode. This perceived business pressure, coupled with the existence of systemic corruption, means that SMEs often “‘cut corners,’ reduce product quality, and overpromise or over commit, which eventually impacts negatively on the sustainability of these operations” (2009: 9).
What is clear, even from the above summary discussion, is that both the informal sector and SMEs pose significant opportunities for economic development in SSA, and that—as such—it is important to define, harness, and identify threats to these opportunities. Ayittey writes that “the stark truth is that meaningful development and poverty reduction cannot occur by ignoring Africa’s traditional and transitional sectors, nor can these sectors be developed without an operational understanding of the institutions supporting them” (2009: 39). This point is particularly important from the perspective of future business ethics research, since—to date—the paradigm case for most conceptual and empirical studies has been big business. In SSA, SMEs and the informal sector (as well as their links with other economic sectors and actors, and with government) should also be considered if we truly wish to develop business as a vehicle for socio-economic development.
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Towards an African business ethics
Much of the analysis thus far has dealt with the macro-economic landscape, and how it supports or undermines business and business ethics. However, this third and final section investigates the extent to which an indigenous African ethics can contribute to the normative basis of business ethics.
Ubuntu: a uniquely African ethics?
One should be loath to speak of an African ethics in the singular. However, there is evidence that the concept of Ubuntu—a Nguni Bantu term frequently explained with reference to the aphorism “umuntu ngumuntu ngabantu” or, loosely put, “a person is a person through other people” or “I am because we are”—is widely accepted across much of SSA as a normative standard of conduct. Ubuntu is typically construed as conveying a communitarian ethic distinct from the more individualistic emphases of the West. Thaddeus Metz (2007), who has done extensive work clarifying the concept, notes that the Ubuntu maxim has both descriptive and prescriptive meaning. Ubuntu signifies that one’s personhood or identity is inextricably bound up (in both a causal and metaphysical sense) with the identity of others. Yet Ubuntu also obliges us to morally support one another.
Empirically there is evidence that an African ethics is widely referenced across SSA (see Newenham-Kahindi 2009). The widespread occurrence of Ubuntu terminology, however, is not sufficient evidence for the claim that Ubuntu signifies a uniquely African ethics. If, however, it can be shown that the notion of Ubuntu is rich enough to inform a normative theory of right action, then the idea of an African ethical theory—representative of moral reasoning across the continent—need not be at odds with Africa’s heterogeneity. The reason for this is that, when formulated in terms of an ethical theory, Ubuntu would not be contingent on contextually-determined norms, but would rather signify a “general principle grounding particular duties that is informed by such values and that could be compared to dominant Western theories such as Hobbesian egoism or Kantian respect for persons” (Metz 2007: 321). Furthermore, if such an ethics truly does present an alternative to the Western ethical canon, then we also find support for the claim that Ubuntu can make a unique contribution to the global debate on business ethics.
A number of introductions to, and applications of, Ubuntu to the field of business ethics appear in the scholarly literature.14 West (2014) notes that these contributions are generally based on two strands of argument, both of which presume that Ubuntu constitutes a true alternative to Western ethical theories. The first argument is that African economic systems should reflect African values and that Ubuntu values should thus form the cornerstone of business in Africa (Murove 2005, 2009); whereas the second argument is that, because of its distinctive nature, African ethics can contribute to the development of a global business ethics (Shutte 2008; Visser 2004).
Andrew West (2014) is critical of both of these lines of argumentation, for the reason that it is not clear that Ubuntu values differ significantly from Western values.15 If West is correct, then the appeal to Ubuntu as a uniquely African business ethics is undermined. As concerns the first argument, West states that the claim that Ubuntu values differ from Western values is often simply assumed rather than supported by empirical evidence. In cases where empirical evidence is provided, it tends to be anecdotal. As such, he concludes that there is simply not enough proof in the literature to support this argument. This conclusion also holds implications for the second argument: if the distinctiveness of Ubuntu cannot be proven—in other words, if the language of Ubuntu resonates with Western ideas—it is not clear what unique contribution African ethics can make to the development of a global business ethic. Compounding this issue is the fact that there are many ambiguities and differences of opinion as to what the distinctive features of Ubuntu are.
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Given the above, West argues that there is a need to undertake comparative empirical studies, aimed at determining both whether there are variations in the value systems of different African countries and cultures, and whether there are significant value differences between Africans and non-Africans. West further notes that additional research aimed at clarifying the meaning of Ubuntu (and its relation to other ethical systems) is required if Ubuntu is to move beyond being a vague communitarian philosophy (that encompasses a number of virtues), to become a robust normative position capable of promoting a just and equitable society, and capable of being fruitfully applied to various disciplines.
Towards a general principle of Ubuntu
Some of the more recent scholarship on Ubuntu centers on the attempt to extract a principle from a plethora of different meanings associated with the term. Of particular influence is the work of Metz who has attempted to develop an Ubuntu principle to ground a normative ethical theory that can serve as an alternative to the normative principles espoused in the Western canon. As a standard to guide right action, Metz formulates the following principle:
An action is right just insofar as it promotes shared identity among people grounded on good-will; an act is wrong to the extent that it fails to do so and tends to encourage the opposites of division and ill-will.
(2007: 338)
Metz’s methodology for deriving this principle was to identify two sets of moral judgements, namely those viewed as uncontroversial by both Africans and Westerners, and those deemed to be more uncontroversial by Africans than by Westerners. In terms of the former, shared moral judgements include prohibitions against killing, raping, lying, stealing, breaking promises, and discriminating. In terms of the latter, moral intuitions associated more strongly with Africans include beliefs that the following are wrong: retributive punishment, decision-making in the face of dissensus, fiercely competitive economics, a rights-based allocation of wealth, isolation from a community’s way of life, and failure to procreate through marriage.
Having identified these sets, Metz then attempts to develop an integrating principle that accounts for the moral judgements in both sets. On this basis, he generates six competing principles, of which the above formulation constitutes the most promising theoretical foundation of an African ethic. Metz argues that the combination of shared selfhood (or personhood) and good-will (understood in terms of the search for the good of others) espoused in the above definition promotes social harmony and togetherness, which Bishop Desmond Tutu (1999: 35) defines as both the crux of Ubuntu and “the summum bonum—the greatest good.” Furthermore, these characteristics best accommodate both the moral intuitions shared by Africans and Westerners, and the moral intuitions that are more common in Africa.
Metz (2007) notes that this project leaves some unanswered questions, primarily related to the promotion of harmony. Nevertheless, despite these unanswered questions, Metz is of the opinion that the above formulation represents the best “fundamental and general principle prescribing right actions that is epistemically justified relative to the circumscribed set of African competitors that could in future work be paired up against Western moral theories” (322–333).
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Applying Ubuntu
In order to operationalize Ubuntu, it must find significant traction in the fields of moral philosophy and business ethics.16 Three factors currently impede the incorporation of Ubuntu in business ethics: Firstly, Ubuntu concepts are vague, abstract, and difficult to operationalize (Metz’s project of systematizing Ubuntu principles in a coherent normative ethical theory is important in overcoming this problem). Secondly, current scholarship is unlikely to culminate in one overarching theory of Ubuntu. The heterogeneity of the term could undermine its uptake in the global ethics community, yet West (2014) argues that this need not mean that Ubuntu could not have a profound impact on certain local contexts.17 Thirdly, Ubuntu shares distinctive features with Western ethical thought (particularly with communitarian positions) and it is also not clear that the moral judgements that feature more strongly in African moral reasoning could not be sufficiently accommodated in existing ethical frameworks.
Apart from these structural challenges to operationalizing Ubuntu, the uptake of Ubuntu in the business community has also been the subject of criticism. David McDonald, for example, views the marketization of Ubuntu values in South Africa over the last two decades as an exercise in window-dressing. He argues that “there is little to suggest that ubuntu rhetoric has done anything to change corporate practice in [South Africa]” (2010: 147). To the contrary, the marketization of Ubuntu has allowed South African business to profess values such as putting communal interests ahead of the individual and strengthening social relations, whilst—for the most part—pursuing business as usual. McDonald argues that governance and corporate responsibility practices in South Africa rather seem to be shaped by international norms and markets (which are becoming increasingly homogenized), than by “any abstract notion of an African ubuntu ‘cosmos’” (2010: 147). As such, he concludes that, to date, the value of the Ubuntu discourse has not been its transformative impact, but its ability to convince “South Africans that market reforms are democratic and egalitarian, while at the same time serving to defuse opposition to underlying neoliberal change” (2010: 140).
To what extent Ubuntu could find traction in business ethics scholarship and practice remains to be seen. However, the emergence and proliferation of high-quality scholarship on Ubuntu in recent years (particularly in the philosophical literature) is a positive development.
Concluding remarks
This chapter has sought to situate and contextualize the study and practice of business ethics in Africa and to suggest, thereby, some avenues for further exploration. It should however be noted that a meta-analysis of the kind undertaken here cannot do proper homage to the plethora of unique socio-economic and scholarly environments in which the subject of business ethics in Africa should be interpreted, evaluated, and operationalized. Yet, the hope is that, in showing how historical, institutional, and cultural contingencies both affect and complicate questions related to the development of business ethics, this research provides an illustration of the type of considerations that should inform any serious reflection on business ethics, whether it be in the African or any other context.
In most of Africa, business ethics is not yet properly institutionalized (both as a practice and as an academic field), and there are many challenges related to its institutionalization. However, the fact that the discipline is still in its infancy also provides exciting opportunities for those working in the field. Business and business ethics practices have the potential to make a big contribution in Africa, particularly because the public sector in many countries is lacking in institutional capacity. Practical contributions should resonate with local realities, and, in this regard, those working in the field should concentrate on developing culturally-sensitive solutions to the identified challenges.
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In light of this analysis, the following were identified as important focus areas for the future: With regard to academic business ethics and governance reform initiatives, research initiatives should be aimed at identifying salient contextual factors that may affect (either positively or negatively) the efficacy of current and future programs, policies, and guidelines. In terms of addressing significant current-day challenges to ethical business and sustainable economic development, focus needs to be placed on the macro-environment in which business operates (and which all too often prevents, thwarts, or renders difficult the development of sustainable enterprise), as well as on SMEs and Africa’s informal sector. With regard to developing business ethics tools for dealing with African problems, a three-pronged approach is forwarded: indigenous governance, political, and economic structures should be investigated with the goal of harnessing and redefining traditional knowledge for modern business; influential Western business ethics theories should be reinterpreted in light of the African context; and, the current scholarship on an Ubuntu ethic, and its potential application to the field of business ethics, should be further explored.
Essential reading
For region and country-specific information on business ethics developments in sub-Saharan Africa see Deon Rossouw and Christoph Stückelberger, Global Survey of Business Ethics in Teaching, Training, and Research (2012). For information on current developmental challenges and opportunities in Africa, see George Ayittey, Africa Unchained: The Blueprint for Africa’s Future (2005). For scholarship on African ethics and its applications, see Munyaradzi Felix Murove (ed.), African Ethics: An Anthology of Comparative and Applied Ethics (2009), and Thaddeus Metz’s forthcoming monograph, titled A Relational Moral Theory: African Contributions to Global Ethics. The African Journal of Business Ethics (available online at http://ajobe.journals.ac.za/pub) is also a good resource on business ethics developments in Africa.
For further reading in this volume on the international extension of Western notions of business ethics, see Chapter 32, The globalization of business ethics. For a general discussion of the question of values across cultures, see Chapter 33, Cross-cultural management ethics in multinational commerce. A discussion of corruption and bribery can be found in Chapter 34, Corruption, bribery, and moral norms across national boundaries. On general issues of corporate governance, see Chapter 24, Corporate governance. On stakeholder theory, see Chapter 11, Stakeholder thinking. For a consideration of the conditions of economic development and innovation, see Chapter 19, Creativity, innovation, and the production of wealth.
Notes
1 The micro-economic or intra-organizational level “focuses on economic activity within business organizations. It concentrates on the moral dimension of business practices, policies, behavior and decisions that occurs within business” (Kretzschmar etal. 2012: 22). The meso-economic or organisational level “refers to the level at which the impact of business on broader society is evaluated” (282) and pertinent themes include corporate responsibility and corporate citizenship. The macro-economic level or economic systems level is the “level at which economic systems or macro-economic policies and trade agreements are scrutinised to see that they are equitable and fair” (280). Here the focus is on economic ethics and sustainability.
2 The Global Survey was commissioned by Globethics.net in 2009 and tracks business ethics developments between 1995 and 2010.
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3 The countries are South Africa, Botswana, Zimbabwe, Angola, Mozambique (Southern Africa); Uganda, Kenya, Tanzania, Ethiopia, Somalia (Eastern Africa); Nigeria, Ghana, Cameroon, Benin Republic, and Togo (Western Africa); and, Ivory Coast, Burundi, Senegal, Rwanda, and the Democratic Republic of the Congo (Central and Francophone Africa).
4 The Survey, in fact, refers to “modules” but without any definition. However, the term is typically used to refer to a university course that runs either over one term (i.e., a quarter of an academic year) or over one semester (i.e., half of an academic year).
5 For the purposes of this survey, the term “publication” was widely interpreted to include academic research, educational publications, corporate reports, and public documents dealing with business and economic ethics research (Rossouw and Stückelberger 2012).
6 For the purposes of this chapter, training programs focusing on business and economic ethics, and taught by universities, professional organisations, and anti-corruption agencies, are distinguished from teaching programs, understood in terms of formal academic courses on business and economic ethics (Rossouw and Stückelberger 2012).
7 Advocacy typically means that the need for, and commitment to, ethical business is affirmed by key stakeholders in business, government, and academia; and this commitment is often expressed by establishing networks and special interest groups centered on the promotion of ethical business.
8 Interestingly, Francophone Africa currently exhibits a much stronger focus on development and economic ethics, when compared with the other regions (Rossouw 2012). The macro context also featured more strongly in the research outputs of Francophone and West Africa than in the other regions. Rossouw offers two possible reasons for this, namely that in these regions business ethics problems are seen as structural rather than functional, and that faith-based institutions involved in the production of most of the research in these areas tend to focus on the macro, as opposed to the meso or micro, context.
9 Rossouw (2009) notes that the interesting exception to this hypothesis is Europe. Despite the fact that individualism and personal autonomy are viewed as paramount, most European countries follow a stakeholder-orientation with regard to governance.
10 These statutes included the Labour Relations Act of 1995, the Basic Conditions of Employment Act of 1997, the Employment Equity Act of 1998 (which, in part, promotes the inclusion of black labor in the formal economy), and the Broad-based Black Economic Empowerment Act of 2003.
11 A unitary board refers to a single-tiered board model, where executive and non-executive board members have an equal legal responsibility for the management and performance of the company.
12 This bleak picture also provides an apt description of the policy (and culture) of apartheid in South Africa, in which people of color were viewed and treated as subservient to white people. Apartheid was kept in place from 1949–1994 by the National Party Government who, through a process of state engineering, artificially segregated the races and provided inferior education to the black population.
13 This report, which can be downloaded from www.transparency.org/whatwedo/publication/global_corruption_report_2009, also provides data and information on private sector corruption in the following sub-Saharan countries: Burundi, Cameroon, Ethiopia, Ghana, Kenya, Nigeria, Rwanda, and Zimbabwe.
14 Beyond the scholarly literature, it is interesting to note that Ubuntu values have also been included in the King Reports. This inclusion bears testimony to the fact that the South African business community believes that Ubuntu can be profitably applied to business, as a means “to better corporate governance and social responsibility while at the same time improving the bottom line and safeguarding the market economy” (McDonald 2010: 143).
15 Many philosophers argue that beneath the apparently different moral norms that exist between cultures, there lies a more abstract agreement on ultimate values. What accounts for these seemingly different moral norms are different backgrounds and non-moral beliefs about the way in which the world works (see, for example, the discussion of cultural relativism in Chapter two of Rachels and Rachels 2007).
16 See Barbara Nussbaum (2009, esp. 249–250) for a discussion on an Ubuntu-infused capitalism.
17 A case in point is South Africa: the smooth transition to a post-apartheid South Africa was facilitated by both Nelson Mandela’s notion of a “Rainbow Nation,” and Bishop Tutu’s reference to Ubuntu during the Truth and Reconciliation Commission hearings. In this context, the Ubuntu rhetoric was instrumental in building a new national identity, thereby straddling the divide between races and facilitating moral regeneration (West 2014).
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