What Is Enlightened Self-Interest, And Does It Matter?

Self-interest is the pursuit of one’s own well-being or happiness, regardless of the impact on others. Enlightened self-interest is the recognition that being good to others can also benefit oneself in the long run.

In business, enlightened self-interest increases company value by securing and maintaining market share, attracting and retaining a skilled workforce, and ensuring that natural resources and raw materials are available for the future.

Enlightened self-interest can also involve sacrificing short-term gains for long-term benefits, such as donating to a charity, volunteering for a cause, or protecting the environment.

The Merriam-Webster Dictionary defines ‘enlightened self-interest’ as “behaviour based on awareness that what is in the public interest is eventually in the interest of all individuals and groups.”

Businesses increasingly adopt strategies based on corporate social responsibility (CSR).

It has been said that CSR is a form of enlightened self-interest. The enlightenment of an organisation is motivated by self-interest, with the target of increasing sales, strengthening the company brand, and inspiring customers and employees.

Napoleon Bonaparte is reported to have said something along the lines of:

“A person will fight harder for their interests than for their rights. People are moved by only two mechanisms: fear and self-interest. Victory belongs to the most persevering.”

Enlightened self-interest is the idea that doing things that benefit others also provides tangible benefits to the individual.

Whether it's big business sponsoring a cause, getting free advertising or tax advantage in exchange for helping provide a public service, a country providing humanitarian aid to another in hopes of favourable future trade deals, or just ordinary people doing someone a favour, the idea is modest: you do well by doing good.

Enlightened self-interest differs from pure altruism, which the Cambridge Dictionary defines as:

“Willingness to do things that bring advantages to others, even if it results in disadvantage for yourself.”

This suggests that the self-interested individual is actively seeking future benefits.

What motivates the focus on CSR and, more recently, ESG (Environment, Social, & Governance)? Is it a genuine attempt to do good, or is it an attempt to look good?

Both terms relate to the social responsibilities of businesses. While CSR holds businesses accountable for their social commitments in a qualitative manner, ESG helps measure or quantify such social efforts.

Committing to environmentally and socially fair practices may initially seem difficult, especially when returns to the business are unclear or hard to quantify. However, when properly implemented, CSR and ESG can provide the guiding principles and measures that make social commitments actionable and directly beneficial to one’s company, especially in the long run.

One major benefit of CSR & ESG is that investors understand that strong social consciousness tends to create a corporate culture that makes the business less open to negative behaviours, such as fraud and corruption.

Social impact considerations are at the top of the agenda for key stakeholders; millennials and Generation Z are leading the charge on social impact, and consumers and employees are increasingly looking for businesses that share their values. Organisations that fail to embrace this new era of corporate sustainability risk getting left behind.

I embrace the concept of enlightened self-interest, that in doing something for others, people also reap profound benefits for themselves. It might involve a little bit of sacrifice and discipline, but participation has given me back so much more than I have given it.

To sum up, whether enlightened self-interest is good or bad is subjective and depends on the context. While it can lead to positive outcomes, it can also be used to justify unethical behaviour. It is important to consider the impact of our actions on others and society as a whole.

Ian Garner

Ian Garner is a retired Fellow of the Chartered Management Institute (FCMI) and a Fellow of the Institute of Directors (FIoD).

Ian is a board member of Maggie’s Yorkshire. Maggie’s provides emotional and practical cancer support and information in centres across the UK and online, with their centre in Leeds based at St James’s Hospital.

He is the founder and director of Practical Solutions Management, a strategic consulting practice, and is skilled in developing strategy and providing strategic direction, specialising in business growth and leadership.