New Encyclical Seeks New Way of Doing Business

Ethical values are needed to overcome the current global economic crisis as well as to eradicate hunger and promote the development of all the world’s peoples, Pope Benedict XVI said in his new encyclical. The document, Caritas in Veritate (On Human Development in Charity in Truth) was released at the Vatican on July 7.

The truth that God is the creator of human life, that every life is sacred, that the earth was given to humanity to use and protect and that God has a plan for each person must be respected in development programs and in economic recovery efforts if they are to have real and lasting benefits, the pope said. Charity, or love, is not an option for Christians, he added, and “practicing charity in truth helps people understand that adhering to the values of Christianity is not merely useful, but essential for building a good society and for true integral development.”

In addressing the global economic crisis and the enduring poverty of the world’s poorest countries, he said, “the primary capital to be safeguarded and valued is man, the human person in his or her integrity.” The global dimension of the financial crisis is an expression of the moral failure of greedy financiers and investors, of the lack of oversight by national governments and of a lack of understanding that the global economy requires internationally recognized global control, the pope said.

United Nations reform. Pope Benedict stressed that the revitalization of the United Nations system is essential if the world is to recover successfully from the current economic crisis and find peaceful means of resolving conflicts. “In the face of the unrelenting growth of global interdependence, there is a strongly felt need, even in the midst of a global recession, for a reform of the United Nations organization, and likewise of economic institutions and international finance, so that the concept of the family of nations can acquire real teeth,” the pope wrote. “To manage the global economy; to revive economies hit by the crisis; to avoid any deterioration of the present crisis and the greater imbalances that would result; to bring about integral and timely disarmament, food security and peace; to guarantee the protection of the environment and to regulate migration: for all this, there is urgent need of a true world political authority,” he said.

Development aid. That the world’s richest nations, the pope wrote, would scale back their development aid while focusing on their own economic recoveries overlooked the long-term, practical economic benefits of solidarity with the world’s poor as well as the moral obligation to help them. “In the search for solutions to the current economic crisis, development aid for poor countries must be considered a valid means of creating wealth for all,” the pope said. The economic growth of poorer countries and their citizens’ demands for consumer goods actually benefit producers in the world’s wealthier nations. The pope said that “more economically developed nations should do all they can to allocate larger portions of their gross domestic product to development aid,” respecting the commitments they made to the U.N. Millennium Development Goals, which aim at significantly reducing global poverty rates by 2015.

Expansive pro-life agenda. Pope Benedict said that being pro-life means being pro-development, especially given the connection between poverty and infant mortality, and that the only way to promote the true development of people is to promote a culture in which every human life is welcomed and valued, arguing that food and water are “universal rights of all human beings without distinction or discrimination” and form a part of the basic right to life. “The acceptance of life strengthens moral fiber and makes people capable of mutual help,” he said.

Development programs and offers of aid that encourage coercive or unethical population-control methods or that promote abortion do not have the good of people at heart and limit the recipients’ motivation to become actors in their own development and progress, the pope said. In addition, an anti-life mentality in the world’s richest countries is partly responsible for a lack of concern for the poor. “How can we be surprised by the indifference shown toward situations of human degradation when such indifference extends even to our attitude toward what is and is not human?” the pope asked. “While the poor of the world continue knocking on the doors of the rich, the world of affluence runs the risk of no longer hearing those knocks on account of a conscience that can no longer distinguish what is human.”

Recognizing all stakeholders. Pope Benedict also re-emphasized church teaching that making money and being wealthy are not in themselves sinful, but that the way in which money is made and the way it is spent can be occasions of sin. The encyclical in particular condemned corruption, the exploitation of workers, the destruction of the environment, the continuing practice of wealthy nations imposing such high tariffs on imports that they shut poor countries out of the international marketplace and, especially, an “excessive zeal” for enforcing patents, especially on medications that could save the lives of thousands of poor people if they were available at a reasonable cost.

The document called for “a profoundly new way of understanding business,” which recognizes that investors are not a company’s only stakeholders, no matter how the business is structured and financed. Employees, those who make the products, people who live in the communities where companies are based, where their products originate and where their products are sold, all have a stake in a business, the pope said. He also wrote that investing always has a moral dimension. “What should be avoided is a speculative use of financial resources that yields to the temptation of seeking only short-term profit without regard for the long-term sustainability of the enterprise, its benefit to the real economy and attention to the advancement—in suitable and appropriate ways—of further economic initiatives in countries in need of development,” he said.