When monetary profit maximization does not rule: historical analysis of English Quakers and the role of religious institutional logic

Abstract

Purpose This paper examines the limitations on monetary profit maximization assumption in Quaker businesses, historically one of England's most successful set of business people. This view challenges the central theoretical assumptions of management and strategic entrepreneurship by demonstrating the influence of religious institutional logic over the profit maximization drive in business. Design/methodology/approach Using a historical analysis of Quaker religious institutional logic, the authors demonstrate how Quakers’ religious logic of simplicity in lifestyle and equality of all people led, in turn, to actions by Quaker businesses that limited the monetary profit maximizing for their businesses. Such actions are consistent with the Quakers’ belief that linked their business activities to their religious beliefs. Findings The present analysis shows that English Quakers had specific beliefs, enforced by the group’s willingness to expel members that limited monetary profit maximization among Quaker businesses. Thus, the authors challenge the typical assumptions of business scholars by demonstrating that business entities can succeed economically even when they do not embrace profit maximization as their core element. This paradoxical finding has the potential to significantly expand management and strategic entrepreneurship theory. Originality/value The authors discuss how religious logic can replace profit maximization as a foundation for business. This insight enriches not only the understanding of business but also of religious institutional logic. Finally, the authors address the call for greater use of historical analysis in the management literature.

In the beginning: the light, scientific management and Quaker Philadelphia

“…Commons (1895) here confirmed the enormous wealth Philadelphia and Pennsylvania had amassed in comparison to other US cities and states. This seems to question that Quaker businesspersons voluntarily “[…] limited monetary profit maximization” (Burton and Sheng, 2023, p. 2). Although Burton and Sheng (2023, p. 4) admitted, for the UK context, the “height of the financial success” of British Quakers in the late 19th century.…”

“…This seems to question that Quaker businesspersons voluntarily “[…] limited monetary profit maximization” (Burton and Sheng, 2023, p. 2). Although Burton and Sheng (2023, p. 4) admitted, for the UK context, the “height of the financial success” of British Quakers in the late 19th century. Importantly, Commons’ (1895) data points to an interesting anomaly for the Weber thesis: Philadelphia and Pennsylvania hugely outperformed other Protestants of North America.…”

“…Particularly, Commons’ (1895) findings here qualify scepticism that the economic can be separated from the sociological or theological (Suddaby et al , 2014, p. 100). Burton and Sheng (2023), in this regard, also seemed too sceptical that the institutional sociological necessarily is in opposition to economics.…”

“…The individual was placed at the center of personal moral responsibility: “As Waldo Emerson was aware […] reliance upon self is, in the end, reliance on God,” and importantly, God, for Quakers, comes as the divine “inner light” within every single Quaker (Tolles, 1938, pp. 154, 164-165; Mott, 2015, p. 62; Burton and Sinnicks, 2022, p. 508; Burton and Sheng, 2023, pp. 5-6; also Baltzell, 1979, p. 454).…”

“…Honesty and trust were not exclusively economic categories yet, as Williamson (1993) later conceptualized this for the new institutional economics. Rather, honesty and trust were, as practice-based theories stress this, grounded in the implicit and tacit nature of underlying social processes, reflecting the sociological and theological (also Burton and Sheng, 2023). The Quaker "pioneers" of scientific management just were very "honorable" businesspersons and gentlemen (Prosser, 1919, p. 73).…”