The next day at lunch Lady Britomart appears writing in her library. Sarah sits reading near the window; Barbara, in ordinary fashionable dress, broods on the settee. Today the family plans to visit Undershaft's cannon works.
Lomax enters and bluntly expresses his surprise at Barbara being out of uniform. Though sympathetic to her disillusionment, he always knew that, unlike the Church of England, there was a "certain amount of tosh" to the Salvation Army. Britomart chastises him.
A weary Cusins enters—to the shock of the family, he was up late drinking with Undershaft after the meeting. Apparently Undershaft completed the "wreck of [his] moral basis, the rout of [his] convictions, the purchase of [his] soul."
Morrison announces Undershaft's arrival. Britomart sends the children out to ready for the excursion. Undershaft enters and before he has time to breathe, Britomart raises the topic of Stephen. Undershaft cannot disinherit him. Undershaft protests that tradition demands Stephen's dispossession. The firm needs a man without relations or education, a man who would be out of the running if he were not strong. The tragedy is that these days all the foundlings are snapped up by the welfare state, domesticated and crammed with secondhand ideas. In any case, if Britomart wants the foundry in the family, she should find a foundling to marry Barbara.
Stephen enters and announces that he wants no part of the foundry. When Britomart attempts to intercede, Stephen informs her that all discussion of his future will now take place with his father, between one man and another. A teary Britomart complies.
Chiding his son for so sulkily repudiating the foundry, Undershaft asks Stephen about his interests. Philosophy, the arts, and law are ridiculous to him. All Stephen knows above all, however, is the difference between right and wrong. Undershaft jeers and asks how Stephen can claim to know what has puzzled philosophers, artists, and lawyers through the ages. Like the Salvationists, respectable people are far too convinced they can teach morality. As Stephen knows nothing and thinks he knows everything, he should go into politics.
Stephen balks at his father's insults to the government. Undershaft brutally reminds him that Undershaft and Lazarus are the government. A patronizing Stephen replies that with his own old-fashion breeding he cannot help but continue to believe that the national character governs fair England. Undershaft rejoins that Stephen is a born journalist.
The group returns to the library. Cusins wonders why he and Barbara are traveling to Undershaft's "Works Department of Hell." A scandalized Undershaft promises that Wilton Crescent is a "spotlessly clean and beautiful hillside town." He never has to play the tyrannical owner because the community's system of social hierarchy keeps everything in order. Cusins recoils in revulsion.
Barbara announces to her father that she will never forgive him for taking a man's soul from her hands. Craftily Undershaft asks if his daughter really believes she can "strike a man to the heart" without leaving a mark on him. Barbara finds hope again and departs for the foundry, searching for "some truth of other behind all this frightful irony."
Act III begins immediately prior to the family's trip to Undershaft's ideal planned community, a masterwork of social engineering. These scenes consist of a number of short dialogues.
In the first scene, Barbara has shed her uniform, prefiguring her ultimate declaration that "Major Barbara will die with the colors." Her disillusion with the Army is complete. A weary Cusins declares himself lost to Undershaft's gospel. As before, the tactless Lomax, speaks, as Lady Britomart remarks, using the formulaic "schoolboy drivel" that successful society men speak in England. His consolation for this is comical: unlike the Anglican Church, the Army always had a bit of "tosh" to it. Clearly, as Shaw insists in the preface, the unmasking of the "tosh" to the Army would implicate the established church as well.
In the subsequent private exchange between Undershaft and Britomart, the former explains the necessity of Stephen's dispossession with what one could call the myth of the foundling. For Undershaft, the foundling is a man who, without family or education, has risen through the world by his will alone. The tragedy is that the welfare state tames these men from birth, rendering them indistinguishable from the herd. The foundling figures as a New Man of sorts, a man whose thoughts and actions free from the binds of social convention. Only such a mythically nameless man can assume the Undershaft mantle and carry forth the firm's gospel.
Andrew bristles at Britomart's insistence on his fatherly duties, since the Undershaft tradition trumps the preservation of the family. Undershaft will have nothing of such obsolete "tricks of the governing class." As observed earlier, among Britomart's primary arms are those of class convention and her maternal authority. Britomart deploys these arms—as well as the memory of their marriage, perhaps—against her ex-husband's bombast. For example, when she plays the maternal wife and comically chastises Undershaft for his crooked tie, she reduces him to "childish grimaces." These familiar forms of domestic sociability present themselves as charming. They allow the audience to deflate and guard themselves against the hero's grandiloquent excesses as if they were the complaints of a child.
The subsequent exchange occurs between Undershaft and a self-important Stephen, dislodging Britomart from her place as head of the family. Stephen attempts to discuss his future with his father, as men must do. The comedy of their dialogue functions according to a principle of enumeration and accumulation. Undershaft lists a series of potential occupations and Stephen rejects each, revealing his uselessness to the world. While without talents or inclinations, Stephen firmly claims to know the difference between right and wrong. Undershaft makes his impetuous son's declaration to highlight the irony of the ideas of the moralists. He wonders how he can, like the Salvationists or politicians, be so sure they know the difference between good and evil.
The final major exchange occurs between Cusins, Barbara, and Undershaft, the poet, savior, and millionaire. Protesting Cusins's description of Percivale St. Andrews as a "Works Department of Hell," Undershaft begins to explain how he has brought his ideal community into being. Percivale St. Andrews runs on its own—its citizens preserve the social hierarchy and make any authoritarianism on his part unnecessary. As we will see, Undershaft's emphasis on hygiene and cleanliness will take on sinister proportions as well, though ones the play does not readily avow. Though the pair recoils in horror as they have done through, they will ultimately come to realize that Undershaft's gospel is the path to human salvation.