Intrinsic alignment between personal interes, firm's goals and societal needs. Afresh lens for doing good and well

ROCHA, H.+

Congreso; Academy of management annual meeting; 2007

Este artículo es con referato This paper revisits "the great trade-off illusion" –that is, the belief that firms must sacrifice financial performance to meet societal obligations- from the standpoint of its assumptions in order to build alternative paradigms for a sustainable alignment between personal interests, firm goals, and societal needs. The basic argument is that making explicit the assumptions on human nature, human relationships, firm goals and societal needs of the dominant paradigm is the starting point for building models and making prescriptions for a sustainable alignment. After making explicit the assumptions of the dominant trade-off illusion dichotomy and their impact on practices and outcomes, this paper analyzes an alternative paradigm called "instrumental-alignment". This paper concludes that neither of these paradigms allow for a sustainable alignment given their restrictive assumptions. In particular, the latter paradigm is based on the assumptions of enlightened self-interest, profit maximization, societal material well-being, and a conflict between individual and collective rationalities, which create an inherent trade-off logic that make alignments not sustainable: they are just instrumental to personal, firm, or societal ends. In order to overcome the limitations of the instrumental-alignment logic, this paper proposes an "intrinsic alignment" paradigm based on the assumptions of excellence and practical or part-whole rationality. In this paradigm, both self-interest and others´ interests are taken into account as ends and therefore are not assumed to be object of trade-offs. Therefore, this paradigm allows a sustainable alignment between personal interests, firm goals, and societal needs because the alignment of interests has value in itself. This paper ends with implications for academics, managers, and policy makers at the level of assumptions, practices, and outcomes.