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Gretchen Spreitzer
  Gretchen Spreitzer
 

Businesses: Models for Peace?

9/7/2005 --

Business organizations can contribute to peace through a leadership approach that encourages employee empowerment.

ANN ARBOR, Mich.—The primary aim in the business world may be to make money, but companies also can serve as models for peace, says a University of Michigan business professor.

Prior research has shown that businesses promote peace by increasing trade—since trading partners are less likely to wage war—and by enhancing the economic well-being of people around the world, thus combating poverty as a key contributor to societal violence.

However, Gretchen Spreitzer of U-M's Stephen M. Ross School of Business says that business organizations also can contribute to "sustainable peace"—the lasting and stable reduction of conflict, corruption, bloodshed and war—through their leadership approach.

"Business organizations can do good for peace by creating business practices that enable people to have a voice," said Spreitzer, professor of management and organizations at the Ross School. "It's a win-win because the business organizations benefit from these progressive management practices while societies benefit from having models of peaceful societies."

In her new study, "Giving Peace a Chance: Organizational Leadership, Empowerment and Sustainable Peace," Spreitzer shows that businesses can promote peace through two organizational features: participative organizational leadership and employee empowerment. These can create conditions in companies and communities that, in turn, may foster peace in civic and governmental domains, she says.

Using various data sets that include nearly 80 countries, Spreitzer found less corruption (the use of public office for private benefit) and less unrest in countries where the leadership of business organizations is more participative.

Further, countries where employees report more freedom to make decisions are significantly related to less corruption and less unrest. However, in countries where employees are more compliant in following their supervisor's decisions without question, there is more unrest, although not necessarily more corruption.

According to Spreitzer, participative leadership encourages employees at all levels to take part in making important organizational decisions and to express their points of view. Such leaders tend to be more tolerant of differences because they believe those differences will improve decision-making, she says.

"Employees who have had a positive experience with participative leadership at work are likely to feel respected and appreciated and are likely to seek out a similar approach in civic and political life," Spreitzer said. "Prior research indicates that countries ruled by more participatory leaders are more prone to peace. Participative systems create conditions for peace because people are more likely to resolve disputes with words and not with more violent means."

Employee empowerment, she says, may enhance peace by reducing feelings of helplessness or lack of control since employees who feel powerless are more likely to resort to violence as a way of influencing their environment. Further, empowerment gives employees skills to institute change or settle conflicts without violence.

"This greater sense of control at work also may carry over into civic and political domains," Spreitzer said. "And when individuals feel more in control, they are less likely to lash out to re-establish a sense of control, reducing the potential for flashpoints of conflict or violence."

Overall, Spreitzer says that businesses serving as "sort of an olive branch for peace, rather than just a harbinger of excess and exploitation," is an attractive idea. Too often, she says, companies seek to have a positive impact on communities through corporate philanthropy or corporate social responsibility—while effective, are often expensive and can be seen as outside the mission of the firm.

"While not meant to substitute for more formal philanthropic efforts, this research indicates that business practices affect more than employees and the firms they work for. They also can impact the communities of which they are a part," Spreitzer said. "Business organizations can create models of peaceful societies that ultimately can move societies toward more peaceful outcomes."

For more information on Spreitzer, visit: http://webuser.bus.umich.edu/spreitze/. For a copy of the study, see: http://webuser.bus.umich.edu/spreitze/peace%20paper%203.pdf.

For more information, contact:
Bernie DeGroat
Phone:(734) 936-1015 or 647-1847
Email:bernied@umich.edu