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Boston University: Alessandro Benetton’s commencement address to the 2009 MBA graduates of the School of Management

Good evening, ladies and gentlemen,

Twenty years ago I was here celebrating, as you are now, knowing that I was at a watershed moment of my life. I was becoming an adult and was eager to take up my responsibilities. Yet I was also frightened, as I imagine you are, by the challenges and tests you will face as you leave this great campus and the beautiful city of Boston.

Let me first of all express my sincere congratulations and my warm wishes for success to all of today’s graduates. I also wish to extend my thanks and compliments to the faculty, for its excellence and professionalism. And I would like to thank the Dean of the Boston University School of Management, Louis Lataif, who kindly invited me to take part in this happy occasion.

Finally I would like to thank the parents and relatives of the graduates, and all of you here, for your kind welcome.

The ceremony that we share today marks an important milestone in your development. It signifies not only an arrival but a new departure, the start of a new phase of your professional and personal journey.

This journey is a little like life itself, and shares many aspects of it: leaving behind the known, accepting risk and uncertainty. But it also brings pleasure, opportunity, and the promise of happiness.

As a graduate of this great university I should be providing you with guidelines for the journey that you are about to start in the world of work. I ought to give you some so-called good advice. But there’s an old maxim that goes, “Old men delight in giving good advice as a consolation for no longer being able to provide bad examples.”

So instead I would like to reflect on some issues that I think are important, especially at this historic moment: a time of global recession such as the world hasn’t seen since the end of the Second World War.

First, let me briefly introduce myself. After getting my undergraduate degree here at B.U. and an M.B.A. at Harvard, I followed an independent professional path. I started at Goldman Sachs International in London, and later founded the first private-equity firm in Italy, 21 Investmenti.

When my family asked me to take charge of the company that bears our name, I agreed with excitement and enthusiasm. Today I’m the executive vice-president of the Benetton Group and on the administrative board of Edizione, the holding company that oversees all our various activities.

My first reflection, which may seem rather eccentric, starts from the Italian worddesiderio, which preserves the same root in other languages: “desire” in English, désirin French. Its origin is Latin, from de-siderare, which means failure to contemplate thesidera, that is, the stars or constellations in which omens for the future could be read.

We desire what we can’t have, and the ancients suffered from the absence of stars on overcast nights because the augurs couldn’t consult them. They had “lofty” desires; they looked to tomorrow.

Our current desires, on the contrary, are too closely tied to the present, to the immediate: now, right away. There is in the world today a general flattening of the sense of time, which is gradually pervading both individual and collective behavior.

The desires not only of individuals but of societies, and hence their thoughts and decisions, tend to respond solely to the principle of instant gratification, of immediate happiness. What ultimately prevails is the “short-view” of those who no longer reflect on the past, nor plan for an achievable future. Indeed, society’s constant focus on the present could be seen as a possible key to understanding the economic crisis.

It’s a hypothesis I find interesting because I believe that one of the causes of the crisis has in fact been a limited vision on the part of managers, of business leaders whose temporal horizons are too limited. I’m thinking, for example, of choices and policies aimed at the short term: the logic of the “quarterly report,” measuring a firm’s success or lack of it with the breathlessness of results calculated every three months.

This obsession with immediate results has, I think, led to a distribution of wealth – to the few – rather than to the true creation of wealth. Indeed, it was President Barack Obama who in his inaugural address declared that the success of the economy also depends “on the reach of our prosperity; on our ability to extend opportunity to every willing heart.”

If you will allow me another small personal digression, I would add that the Benetton Group has had to choose between short-term actions, often sought by the market – like the liquidation of property assets or the disbursement of special dividends, or a greater recourse to borrowing – and long-term vision.

We have chosen this second, carefully considered direction. We have chosen to invest. And we have been able to confront the current international crisis with solid assets and with a capital of experience and values that can express our vision of the world, a vision not driven by the financial market short view or by the stock price of the moment.

The manager of today, then, must have a long-term vision and, at the same time, awareness and knowledge of the past, with the aim of “reinventing the past to see the beauty of the future.”

The second theme I would like to reflect on, is that of responsibility. It’s an important subject, especially at a moment when, in the United States as in Europe, the crisis of trust in business and management is being transformed into “populist rage,” asNewsweek put it a couple of months ago.

Throughout the world – here, in Great Britain, France, Belgium, Italy – slogans ring out, and unfortunately not just slogans, against managers, bankers, entrepreneurs, who, rightly or wrongly, are considered principally responsible for the crisis.

In Europe in recent weeks a French film entitled Louise et Michel has been playing. In the film, a group of factory workers, who have been fired overnight, decide to pool their small settlements to hire a hit man to kill the factory owner.

Luckily for us this only a movie! It’s an entertaining and paradoxical black comedy but it captures a certain spirit of the times, treating the burning topics of today’s political-economic agenda with an irony that verges on sarcasm.

I think that to respond effectively to this increasing social tension, the economic, financial and governmental world needs to construct a new framework of regulations and, at the same time, assume a deep responsibility.

In the face of a crisis so serious and widespread, taking responsibility, toward business but also toward society, toward others as toward ourselves, becomes indispensable, so that we may look with an ethical sense outside the business system: at the social context, the community, the environment. And reconcile the creation of wealth with greater social equality.

It’s time for a new alliance between capital and work, between responsibility and democracy, in order to prevent the crisis – first financial, then economic – from becoming a real lack of equality and hence an even greater social problem.

The theme of responsibility is closely intertwined with that of ethics, so that we arrive at a definition of managerial morality that goes beyond obligation and responsibility to the firm and the shareholders.

What we need, then, is a greater civic and collective morality, because without it society cannot advance; and along with it we need a private, individual morality, which continually renews and regenerates the public one.

Besides, today we can’t afford the luxury of opposition between government and the market. Collaboration is more essential than ever. The combination of free and open markets, properly regulated, with a government promoting social justice and opportunity for all, might indicate the right direction.

Managers, bankers, and entrepreneurs must also find in the crisis the possibility of rethinking their own organization, with the aim of regaining efficiency with greater capacity and awareness, getting past the idea of quick returns. Exhorbitant executive salaries should became a thing of the past as well.

To sum up, the managers of today should be bold and innovative but at the same time cautious and analytical. They must take on the decision-making process responsibly, avoiding improvisation, and mindful that success will not be immediate.

Another concept that seems to me important is that of the frontier. It might seem pleonastic, in a time of globalization, to assert the need to examine anew the concept of the frontier. And, furthermore, in a country that was constructed on the myth of the Frontier: first the geographic frontier, then the human and social.

But today we need to think of the frontier not as a barrier to potential conquest but as, eventually, a passage toward further human progress.

And if in scientific knowledge and innovation the frontier today is more than ever the shape of the future, of new horizons, in economic terms it can and must be an opening to the world and to new markets: an opening free of political, ideological, or religious prejudice.

This is the case of the Benetton group, which has a presence in 120 different countries, and whose international development has been based on the spirit of travel, on the crossing of borders, and hence on respect, dialogue, and collaboration with different societies, cultures, and peoples. This is, if you look closely, the opposite of globalization that conceives of the world as fixed and time as finite – a conception that denotes an absence of imagination and an attachment to the present.

In order for us to emerge from the current crisis – as the president of the European Commission, José Manuel Barroso, noted – globalization has to be “refashioned,” through a series of regulations on a worldwide scale that, originating in an effective international collaboration, will allow the potential of markets to become a resource for citizens, and enable us to face together global challenges such as climate change, energy security, and the fight against poverty.

I believe that the manager of the future must be truly without borders, above all mental borders. He or she must not place limits on their own creativity. This is a word that, beyond clichés and exaggerations, represents a true resource.

The future will belong to active, creative managers in networks where the newest ideas, the most advanced knowledge, the most profitable agreements circulate. And by “creative managers” I mean those who can be free and inventive within a framework of regulations, a basic structure, in developing the identity of their business.

Managers have to have a sense of belonging, of identification, beyond the sole objectives of salary increases and personal advancement. In fact, a coldly specialized, exclusively “technical” vision may enable one to deal with an emergency but not build a career.

The subject of creativity goes back to the importance of aesthetics as a value that defines the meaning of art and, more broadly, everything that is beautiful. But it is also closely linked, in its Greek derivation, to sensation, to the perceptions of the senses: to a way of “sensing” the world.

Aesthetic knowledge – like the idea of taste – is indispensable if one is to operate successfully in today’s mass-consumer market, along with the ability to manage, and to give the proper weight to, the elements of style, design, communication, and “emotion” of products and services.

This knowledge is essential if the manager is to avoid a myopic vision, excessively focused on technical questions, because he is incapable of seeing the repercussions of his actions on a global scale.

As a convinced optimist, I think that we must instead make room for ideas, for creativity, for talent, for youth. At Benetton we continue to invest in these values.

In fact, I am convinced that this crisis has generated the possibility of looking at and living this moment – not an easy one – in an innovative and different way. We can change our point of view, put ourselves on the side of opportunity with faith and optimism. We can make of our own thoughts, words, and experiences a bridge that connects us to others, that makes diversity stronger and more constructive than homogeneity.

What will count more, in the end, is the wide range of qualities, values, and passions that you can put into your experiences, with all the optimism that your fine education permits, and with the desire for the future that day after day you must cultivate within yourselves. Again, my congratulations. Good luck to you all and thank you for your attention.

Boston 15th May 2009

 

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