Business leaders gathered in Enugu for the 2024 Amadeo Business Summit today were stunned to hear Professor Bart Nnaji, founder and chief executive officer of the Geometric Power group, tell them to think of business beyond profit-making.
“A business that is concerned with only maximizing shareholder value, or maximizing profit at all costs, will end up creating social disharmony that can consume it in the long run,” Nnaji, a former Minister of Power, declared to the large gathering attending the three-day summit that kicked off earlier today at Amadeo Event Centre, Enugu.
The event was declared open by Enugu State Governor Peter Mbah, who was represented by Adaora Chukwu, Commissioner for Trade and Investment. In her remarks, Chukwu commended the focus of the summit on sustainable business practices, stressing that “the Mbah administration is committed to creating an environment where businesses thrive not just for profit but also for the common good of society.”
Other dignitaries present included Architect Ahmed Musa, Minister of Housing, who emphasized in his speech the importance of businesses contributing to the development of local communities, as well as Monsignor Obiorah Ike and Professor Chinedu Nebo, former Minister of Power, among others.
Apparently disagreeing with the view of the Nobel Prize winner in economics, Milton Friedman of the University of Chicago—whose ideas influenced the late American president Ronald Reagan, the British prime minister Margaret Thatcher, and such international institutions as the International Monetary Fund (IMF) since the 1980s—Nnaji, a globally reputed engineering professor in the United States before returning to Nigeria to establish the Geometric Power group in 2004, cited the famous 18th-century British economist and philosopher, Adam Smith, to support his thesis.
He acknowledged that the farmer, the butcher, and the baker are motivated by the profit motive rather than altruism.
“However,” Nnaji, also an erstwhile Minister of Science and Technology, noted, “to make a profit for themselves, they invariably contribute to societal progress by giving society what it needs to be happy and stable like food and meat.”
In the lecture entitled “Business Must Strive for the Common Good,” Nnaji told the summit that the era of stockholder capitalism is being replaced by the stakeholder capitalism concept.
He referred Nigerian business managers and academics to the title and theme of a new book by the German engineer and economist Klaus Schwab, who in 1971 founded the World Economic Forum (WEF) that holds its annual summit in Davos, Switzerland, every January and is attended by world leaders, academics, business leaders, writers, and other thought leaders. The book is entitled “Stakeholder Capitalism: A Global Economy that Works for Progress, People and Planet.”
Nnaji explained that in the new economics, stakeholders are not just investors in a business but also workers, distributors, suppliers, the host community, non-governmental organizations (NGOs), and even the government, which gets tax revenue from organizations and is also happy that the organizations employ citizens directly and indirectly.
He added that business leaders like Bill Gates, founder of Microsoft, have embraced the new idea of capitalism because it is against exploitation.
“Businesses must care about the common good, not just profit,” the former minister declared.
He stated that he cited the 188 megawatt Geometric Power Plant and the Aba Power Electric Company, Nigeria’s 12th distribution firm, in Aba, Abia State, not only for profit but for “the common good inherent in spreading the benefits of manufacturing in different parts of Nigeria to stimulate progress in all parts of the country.”
He said that if he was driven purely by only profit, he could have located both the gas-fired plant and the embedded distribution company in such industrialized places as Ikeja or Ilupeju in Lagos State or the Agbara Industrial Estate in Ogun State where manufacturers could pay anything to have reliable, quality, and affordable electricity supplies instead of relying on self-generation, which is very expensive and worsens the environment.
He recalled how the then World Bank president, James Wolfensohn, and the former Nigerian Minister of Power, Dr. Ngozi Okonjo-Iweala, requested him in March 2004 to build a 50MW plant in Aba to serve the industries in the Southeastern city known for indigenous technology who could afford to pay higher for electricity, but he later decided to increase the power generating capacity to 188MW to accommodate small manufacturers in open markets, hospitals, medical laboratories, professional offices, and everyday people in the Aba metropolis and even all local government areas around it “at a huge cost to me and my partners.”
On the concept of corporate social responsibility (CSR), the professor said that “it goes far beyond giving back to society,” telling Nigerians, including management experts, that it also entails promoting environmental protection, treating organizational members with courtesy and dignity, assisting them to fulfill their career ambitions regardless of gender, creed, or ethnicity, and refusing to benefit from exploitation even if the exploitative act is not committed by the organization but by its partners like suppliers.
“A company can be guilty by association,” he remarked, citing the example of Nestlé of Switzerland that was severely criticized for benefitting from “slave labour because one of its suppliers was getting its cocoa beans from farms in Côte d’Ivoire where underage children were used.”
Nnaji also lauded the growing interest by researchers and other management experts in the South African Ubuntu philosophy “because it depicts the African traditional commitment to solidarity, harmonious existence, compassion, and interdependence.
“Ubuntu, which literally means ‘I am because we are,’ represents what the Igbo people call onye aghana nwanne ya, that is, be your brother’s or sister’s keeper.”
