Social Catholic Thought and the Economy of Communion as business model

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Social Catholic Thought and the Economy of Communion as business model New Economy, Old traditions: Caring Entrepreneurship Annual European SPES Conference Social Catholic Thought and the Economy of Communion as business model Tel Aviv, September 2017 José Luis Fernández Fernández Cristina Díaz de la Cruz

Three Classical Questions for Economics What should we produce? How should we produce it? For whom should we produce it? The new questions How should we extract raw materials? How could we convert disposals into resources? The Quest for Sustainability Extraction-Production-Distribution-Consumption-Reuse Impact: Micro level Meso level Macro level

New Disruptive Ways for Combining Production Factors Land Circular Economy Sharing Economy Capital Digital Economy Technology Lineal Economy MARKET Labour

Social Catholic Teaching We have a Good News that we are happy about It is not the "repentance" of John the Baptist; Neither "the Kingdom is near", of Jesus ... It is: "He is risen." And this changes the story How to translate to day to day? The Social Catholic Teaching helps us

Timeline It has been forged over nearly 130 years Rerum Novarum Quadragessimo Anno Mater et Magistra Pacem in Terris Gaudium et Spes Octogessima Advenines Laborem Exercens Solicitudo Rei Socialis Centesimus Annus Caritas in Veritate Laudato Si’ Accrual It has been forged over nearly 30 years

Benedict XVI: Caritas in Veritate In front of a very serious crisis Not only a dialectical crisis but a structural, systemic, and enthropic one We need a new paradigm We need a new leadership We nned a new humanins We need to read the Encyclical as a timely message to rederict Business Ethics

Benedict XVI: Caritas in Veritate The culture of “giving” 34. Charity in truth places man before the astonishing experience of gift. Gratuitousness is present in our lives in many different forms, which often go unrecognized because of a purely consumerist and utilitarian view of life. The human being is made for gift, which expresses and makes present his transcendent dimension. (…) In addressing this key question, we must make it clear, on the one hand, that the logic of gift does not exclude justice, nor does it merely sit alongside it as a second element added from without; on the other hand, economic, social and political development, if it is to be authentically human, needs to make room for the principle of gratuitousness as an expression of fraternity.

Benedict XVI: Caritas in Veritate The purpose of the enterprise 46. When we consider the issues involved in the relationship between business and ethics, (…), it would appear that the traditionally valid distinction between profit-based companies and non-profit organizations can no longer do full justice to reality, or offer practical direction for the future. In recent decades a broad intermediate area has emerged between the two types of enterprise. It is made up of traditional companies which nonetheless subscribe to social aid agreements in support of underdeveloped countries, charitable foundations associated with individual companies, groups of companies oriented towards social welfare, and the diversified world of the so-called “civil economy” and the “economy of communion”. This is not merely a matter of a “third sector”, but of a broad new composite reality embracing the private and public spheres, one which does not exclude profit, but instead considers it a means for achieving human and social ends.

Benedict XVI: Caritas in Veritate In front of a very serious crisis Not only a dialectical crisis but a structural, systemic, and enthropic one We need a new paradigm We need a new leadership We nned a new humanins We need to read the Encyclical as a timely message to rederict Business Ethics

Origin of Economy of Communion (EoC) It began in Brazil in 1991. The Movement of Focolares was growing up really fast and they were unable to cover even the most urgent needs of their members, notwithstanding the intense communion of goods. Chiara Lubich, the founderess of the movement, thought that their people could set up firms and business enterprises so as to engage the capabilities and resources of all, and to produce together in favour of those in need. Source: Chiara Lubisch (1999). Available at: https://eocnorthamerica.files.wordpress.com/2015/11/chi_19990129_en.pdf

Pope Francis: Laudato Si’ On Care for Our Common Home

Social Thought Teaching Principles Transcending Common Good Solidarity Subsidiarity Flourishing Human Person: Imago Dei

Economy of Communion (EoC) A challenge to the standard Economic Theory An innovative way of doing business An alternative paradigm to management A potential development for a Christian ethos into management A new comprehension of Business Purpoose A way for humanizing the economy

Spread of Economy of Communion In these first years the project has had immediate echo not only in Latin America where it was launched, but also on other continents. In October 2015 there were 811 member companies of various dimensions: Europe 463 (of which 263 in Italy) Latin America 220 North America 26 Asia 18 Africa 84 The doubling of the number of African companies compared to the previous census is to be noted. This new economic culture intends to promote a new concept of economic action which is not only utilitarian, but aimed at the integral development of man and society. Source: http://www.edc-online.org/en/eoc/how-itas-spreading.html

Philosophical foundations Anthropology: From Homo Oeconomicus to Homo Reciprocans Freedom From Free-to-chose, to Free-for-fullfilment Markets From A-social or Anti-social, to capable of Reciprocity Not Neo-Liberalism nor Neo-Statism Not Consumerism nor Communism, but Communion Beyond the Possessive Individualism, Culture of Giving and Gift as gratoutiousness

Origins of EoC It began in Brazil in 1991. The Movement of Focolares was growing up really fast and they were unable to cover even the most urgent needs of their members, notwithstanding the intense communion of goods. Chiara Lubich, the founderess of the movement, thought that their people could set up firms and business enterprises so as to engage the capabilities and resources of all, and to produce together in favour of those in need. Source: Chiara Lubisch (1999). Available at: https://eocnorthamerica.files.wordpress.com/2015/11/chi_19990129_en.pdf

EoC: The Purpose of the Firm Shareholder Approach Stakeholder Approach Corporate Social responsibility model Mission Driven Organization EoC COMMUNION Intrinsic Motivation Vocation PERSON COMMON GOOD

EoC: How to Share Profits The enterprises would have to be managed by competent persons who would be capable of making them function efficiently and derive profits from them. These profits would be put in common freely: One part would be used for the same goals of the early Christian communities: to help those in need, to give them something to live on until they find work. Another part, to develop structures to form “new people” (as the apostle Paul calls them), that is, people formed and animated by love, suited to what we call the “culture of giving”. Finally, one part would certainly be used for the growth of the firm. Source: Chiara Lubisch (1999). Available at: https://eocnorthamerica.files.wordpress.com/2015/11/chi_19990129_en.pdf

EoC: Principles Contrary to the usual approach in situations of poverty that is thinking at redistribution of the wealth generated by others Redistribution in the invisible hand of the market is not enough Lubich invited talented entrepreneurs to create companies managed according to the “communion principles” Neither communism, nor consumerism, communion Understanding the market as a meeting place where it is possible to live “virtuous” relationships and no just fierce competition Source: Hernando, Isaías (2015), Spiritual Capital for innovation the economy of communion (EoC) experience. Spirituality & Creativity in Management World Congress 2015, ESADE: Barcelona.

Principles of Economy of Communion Understanding the enterprise as a community of personas The seven colours of the rainbow, represent seven important aspects of the personal con communitarian life: 1. Red: Entrepreneurs, workers and business 2. Orange: Relationships with clients, suppliers, financiers, civil society and external subjects 3. Yellow: Spirituality and ethics 4. Green: Quality of life, happiness and relationships 5. Blue: Harmony in the workplace 6. Indigo: Formation, instruction, wisdom 7. Violet: Communication Source: Hernando, Isaías (2015), Spiritual Capital for innovation: The economy of communion (EoC) experience. Spirituality & Creativity in Management World Congress 2015, ESADE: Barcelona.

Conclusion Let’s read a short paragraph from Chiara Lubich

THANK YOU FOR YOUR PATIENCE Tel Aviv, September 2017 José Luis Fernández Fernández: jlfernandez@comillas.edu Cristina Díaz de la Cruz: cdcruz@comillas.edu