College of Business

What is Responsible Business?

April 14, 2020

Kelly O’Brien and Shyam Kamath

Responsible Business Logo

Responsible Business is a core concept

Responsible business is a core concept at the College of Business at CSUMB and describes how the next generation (and many of the current generation) of 21st century businesses operate. What are the key characteristics of responsible business? How is responsible business different from corporate social responsibility?

The "Quintuple Bottom Line": Profit, People, Planet, Ethics, and Equity

Simply put, responsible business is the practice of creating customer value through the active concern for people, ethics, equity, and environmental impacts while running a profitable business. The Quintuple Bottom Line (QBL) of Responsible Business enables us to view business practices and challenges through the lens of Profit, People, Planet, Ethics, and Equity.

By focusing on Profit, a business ensures it is financially sustainable. Without generating a profit, a business cannot survive or thrive, so the primary role of a responsible business owner is to ensure that the business returns a profit and provides income to survive and grow. Unless it makes a profit, the business cannot fulfill the other four aspects of the QBL.

By paying attention to People, a business focuses on its employees, suppliers, and customers. Employees are the key group that make the business function and enable it to create value-added. Satisfied, happy, and productive employees are the lifeblood of a successful business. They deserve good wages, meaningful employment, and the means to sustain their families and live meaningful lives. Suppliers are key because they enable the business to obtain inputs that are goal-effective and cost-effective in order to generate value. Customers create the demand for its products and deserve safe, high quality, and high value products and services.

Planet refers to the responsibility of the business to operate in ways that minimize the harm to the environment and the planet, through its actions. It treats the natural environment as a finite resource, which must be sustained and respected. Environmental degradation and destruction leads to a situation in which business itself is no longer sustainable.

Ethics is a code by which a business abides, which includes legal, moral, and values-based considerations that guide business behavior. Ethics includes operating with integrity and in a transparent manner; that is, “doing it right” with nothing to hide. “Do right to do good” is the guiding principle of responsible business.

Kelly O'Brien

Kelly O'Brien is CEO of Tendaji, LLC, a woman-owned, employee-driven consultancy based in Carmel Valley, California. She is a member of the Business Advisory Council and an Executive-In-Residence at the College of Business at CSUMB.

Dr. Shyam Kamath, Ph.D.

Dr. Shyam Kamath, Ph.D., is the dean of the College of Business at CSUMB.

Become a responsible business leader

A strong commitment to responsible business can protect and enhance a company’s brand, create a more positive working environment, boost profits, and attract top-tier talent. Consider how an Online MBA from California State University, Monterey Bay, with its focus on responsible business, can offer you the professional business competencies valued by employers in today's global marketplace.

Visit the CSUMB Online MBA BLOG to read insightful and innovative articles on responsible business themes.