The Profit of Peace
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The Profit of Peace

Corporate Responsibility in Conflict Regions

It may seem a strange notion to give the private sector a role in conflict prevention or resolution, but multinational corporations (MNCs) do have some characteristics that make them good partners in a well-designed strategy for peace and stability. By focusing on their core competencies, their presence in a conflict region can help to provide prosperity for rebuilding society and its institutions, and improved respect for human rights.

This book is not a song of praise for MNCs in general. There is a litany of examples of companies that feel no shame in profiting from conflicts by trading weapons or illegal resources, that prolong war by supporting one or other of the parties, or that are only in a war-torn country because the lawlessness suits them well. Even companies that refrain from such criminal activities cannot be envisaged as potential peace-builders if they profit unscrupulously from cheap labour or cheap subcontractors. Instead, this book is about corporations that are disposed to ethical, responsible entrepreneurship: companies that balance their desire for profit with compliance with international business and human rights standards and with a genuine investment in local workers, environmental protection, social development and stability.

Worldwide about 60,000 MNCs work in over 70 conflict regions. They operate in regions where social unrest is harshly repressed, where outright fighting takes place, or where civil war has recently ended. Whatever the attitude of multinationals and whatever their area of business, they influence conflicts or are themselves influenced by conflicts. Even if they do not directly invest in or trade with a conflict region, they always risk being associated with those conflicts.

The Profit of Peace examines how multinationals can use their core business competencies to promote peace and stability in conflict regions and what role  – if any  – business has in diplomacy. To investigate these questions the authors interviewed CEOs and high-level managers of multinationals working in 'challenging' countries such as Afghanistan, Burma and Rwanda. The interviewees provided extraordinarily candid views on both the practical and ethical issues that occur when operating under extremely volatile circumstances. The lessons learned by these managers make the book invaluable for any manager working for a large company in a region of unrest.

Two vital elements emerged. Firstly, the ability to manage cultural differences is a key factor for success. Without a keen sense of the differences in management styles, in perceptions of ethics and morality, and in the values behind political opinions, every peace effort is doomed to fail. Secondly, ethically correct decisions do not necessarily lead to ethically correct results.

It was not the objective of the authors to judge which of the parties in conflict regions are right or wrong. Rather, they wanted to find out what kind of attitude at the end of the day contributes most effectively to conflict prevention or stabilisation of a region. In other words, in this book corporate responsibility is measured by the results and not by the intentions.

All of the CEOs interviewed for this book were well aware of the fact that their companies operating in conflict regions would always influence the conflict one way or another. This awareness in itself is quite extraordinary, and it shows that the indifferent comment "business is business" by and large belongs to a past era. Also extraordinary was that the managers allowed such a frank look into their sanctuary, since this candour makes them all the more vulnerable to criticism.

Through the information from the interviewees and from other managers who have experience in conflict regions, the book outlines the ingredients for an approach that can best lead to a solution of conflicts and to greater stability. It will only be in the long run that we will be able to establish how successful the new profession of 'business diplomat' can be, but in the meantime the daily practices of MNCs show that they can work on 'the profit of peace'.

This book is based on investigative journalism and contains many examples of best practices worldwide. It will be essential reading for practitioners, policy-makers and students involved with corporate social responsibility, peace studies, development studies and stakeholder management.

The Profit of Peace is both simply and extremely well written. It combines interviews with top executives, values analysis and intercultural perspectives. It leads to the conclusion that trust and collaboration between these multinationals and NGOs has the greatest potential not only for reaching the organizational goals of each, but enables them better contribute to local well being and prosperity – perhaps the critical condition for developing greater freedom and increased respect for human rights. ...Who should read this book? Certainly multinational managers and policy makers who would like to question organizational machismo and seek deeper insight into the nature of their dilemmas in conflicted environments; certainly NGO activists and those academicians who fear that initiating dialogue with corporate types makes them adulterous bedfellows; certainly interculturalists and those of us who consult with people who manage and work in organizations. ...I would also recommend The Profit of Peace strongly to those working in the media and those engaged in politics. Often it is the moral indignation or the trust of the public that can be either most damaging or most helpful in ethical dilemmas. The challenging ideas in this book whether read in its pages or mediated by those who influence populations and organizations can help to refine our overall ethical sense. www.georgesimons.com, 28 May 2006. Read the full review (Word document)

Dr George Simons

This is a book, long overdue, which addresses one of the most neglected aspects of the complex process of establishing a stable post-conflict environment. ... [The authors] have produced a book which should be essential reading for any student, of whatever level, who wishes to understand the reality and complexity of post-conflict stability and development issues; the style in which it is written should also ensure that a wider audience amongst politicians, NGOs and the business community will enjoy and benefit from reading it ... Finally, the extensive bibliography and list of useful web-sites will prove invaluable to hard-pressed students seeking to explore this important aspect of post-conflict reconstruction further ... The authors are also to be congratulated for the clear and jargon-free style in which the book is written. Read the full review (PDF document)

Peace Conflict and Development, Issue 8 (January 2006). David Pinder

Their core argument is that multinationals can contribute to peace and to solving conflicts by focusing on their core business – that is, doing what they do best: make profits... What makes this book ... an interesting read are the interviews with CEOs.

Review of International Social Questions, 2 September 2005

The authors take a pragmatic approach, pointing out that ethically correct decisions do not always produce ethically correct results. Each chapter examines a management dilemma, illustrated with examples from a range of conflict zones, interspersed with insightful comment from managers who have worked 'on the front line'. By sticking to its core business, the book argues, a multinational can contribute to strategies for peace. But companies have a responsibility to go further. Managers must become 'business diplomats', partnering NGOs and making the case for private sector based development.

Corporate Citizenship Briefing, September 2005 Oliver Wagg

The authors of this book dare to challenge us with the concept that our ethics bear the stamp of our own cultural peculiarities, and that perhaps those peculiarities need to be reflected upon and negotiated rather than be imposed as absolutes ... The book leaves us with dilemmas to digest, e.g.: Which comes first, peace or justice? Democracy or well-being? ... Who should read this book? Certainly multinational managers and policy makers who would like to question organizational machismo and seek deeper insight into the nature of their dilemmas in conflicted environments; certainly NGO activists and those academicians who fear that initiating dialogue with corporate types makes them adulterous bedfellows; certainly interculturalists and those of us who consult with people who manage and work in organizations ... ... I would recommend The Profit of Peace strongly to those working in the media and those engaged in politics ... ... The challenging ideas in this book ... can help us refine our overall ethical sense ... www.dialogin.com

Delta Intercultural Academy

Investing in conflict regions ... requires perseverance and necessitates solving many ethical problems ... Co-operation between the national government, tribal leaders, the UN, non-governmental organisations, embassies and multinational corporations is very important ... This book, containing many examples of good efforts, is an important contribution to developing such a strategy.

Major-General Patrick C. Cammaert, Military Adviser, Department of Peacekeeping Operations of the Un

Business cannot succeed if states fail. How business acts and uses its influence in conflict-prone situations can make a big difference, both for better and for worse. This book provides important insight for business executives and policy-makers. It will hopefully help to make business part of the solution.

Georg Kell, Executive Director, Global Compact Office, United Nations, New York

Foreword
Major-General Patrick Cammaert, Military Adviser, Department of Peacekeeping Operations of the United Nations
Introduction
1. Multinational corporations and conflicts
2. Ethics and culture
3. Enterprise and government
4. Clean hands and failing states
5. Power and privilege
6. Carrots and sticks
7. Profits and ideals
8. Scenarios and storytelling

Bibliography
Useful websites
Appendix: map of conflict regions

Karolien Bais and Mijnd Huijser are the founders of Logos Research, a consultancy working with multinational enterprises in conflict regions that are willing to match their corporate goals with local needs for stability, prosperity and peace.

Karolien Bais is an investigative reporter, specialising in international relations, development co-operation and military peace missions. Born in Indonesia, she has lived in the Antilles, Nigeria and the Netherlands and has been a travelling journalist working for Dutch media and press agencies since 1972. She has published articles, surveys and books on conflict-ridden countries including Nigeria, Mozambique, Nicaragua, Cambodia, Bosnia-Herzegovina, Israel/Palestinian Territories, Sri Lanka and Afghanistan.
www.businessdiplomacy.biz

Mijnd Huijser is senior consultant in cross-cultural management and managing director of CMC-Culture & Management Consulting. Having lived and worked for 15 years in Southeast Asia, the Middle East and France, he has gained considerable experience in international business and inter-cultural co-operation. He specialises in cross-cultural communication, confidence building and conflict management. In the Netherlands he has worked with 'culture gurus' Geert Hofstede and Fons Trompenaars as a cultural awareness trainer for Fortune 500 companies. Among his current clients are 3M, Accenture, Canon, Clifford Chance, Nissan-Renault, Philips, Unilever and the Clingendael Institute for International Relations.
www.cmc-net.org

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