Conscious Capitalism
Why Now is the Time for Conscious Capitalism
We have a golden opportunity to reboot capitalism, and we believe purpose is the source code at the foundation of this restart. Our aim should not merely be to replace what is lost, but to build our society and the planet back better than ever before. To do this, we need to do more than restore the status quo, because that condition created the extreme inequality and the climate crisis, both evidence of the systemic failure of unethical capitalism.
There has never been a more opportune time to make this shift. With the political world in tumult, unemployment at record levels, and the fragmentation of the international world order that has been the bedrock of progress since World War II, people expect businesses to fill voids that governments and nonprofits can't address alone. We need today's companies to show the will and wherewithal to lead the way in addressing urgent social and environmental issues.
What Are The Tenets of Conscious Capitalism?
Purpose-driven businesses with authentic values at their core focus on creating not just shareholder profit, but also positive social and environmental impact. This is the next stage in the evolution of capitalism.
Companies must advance a mindset of giving more than taking, of choosing for the future over the present, of public good over self-preservation. Brands must move from seeing customers as passive audiences of ads to active participants in change. We must promote listening, learning, compassion and involvement as the new pillars for innovation and growth.
180+ Leaders of Business Roundtable Sign A Conscious Capitalism Pledge
In August 2019, nearly 200 corporate leaders in the Business Roundtable signed the Statement on the Purpose of a Corporation. This declared that companies shouldn't make shareholders their sole focus. Instead, they should embrace sustainable environmental practices, and deal ethically with employees and suppliers, among other societal goals. A shortlist of these companies include Apple, AFLAC, American Airlines, Accenture, American Express, Amazon, Walmart, Walgreen, Johnson and Johnson, John Deere, Goldman Sachs, Home Depot, IPG, GM, Hearst, General Dynamics, Fedex, Fox, Deloitte, Dell, Coke, CVS, Chevron, Citigroup, Cisco, Cigna, Carlyle Group, Best Buy, AT&T, Boeing, Bristol Myers-Squibb, Bank of America, Blackrock, United Airlines, UPS, Tishman Speyer, Steelcase, Target, P&G, SAP, Qualcomm, Pfizer, PWC, Salesforce, PepsiCo, Oracle, Metlife, Morgan Stanley, MasterCard, Macys, Mass Mutual, JP Morgan Chase, Marriott, KPMG, Visa, Xerox, 3M and many more.
We are reaching a tipping point. The Business Roundtable's statement comes on the heels of years of growth of the Conscious Capitalism movement, and is the latest sign that these principles are becoming mainstream. As more and more people adopt this paradigm of capitalism, we will eventually reach a point where the term Conscious Capitalism is redundant. And that point may not be far off.
Why Conscious Capitalism Works for Consumers
Companies that take the time to deeply understand their DNA and relationship with society and build purpose-led strategies into their operations are much more likely to win over consumers. These consumers will not only pay attention to the nuances of how a company operates but, once delighted, will share that information with their networks. The value of their advocacy is a priceless incentive to be good citizens.
Beyond integrity in products and processes, consumers today want brands to take a stand on issues that matter, and to invite them to be part of the solution to the problems they both care about. By giving people a voice and a platform for participation, companies can spark a movement greater than their brand.
Conversely, disappointed consumers will turn elsewhere, choosing not to buy at all rather than spend on a product that doesn't align with their values—or worse, use the megaphones of social media to tear down a company that they believe is bad for the world.
Why Conscious Capitalism Works for Employees
Purpose-led companies will also need to listen to what their employees care about and respond accordingly. This inside-out approach will demonstrate that a company has the best interests of its employees at heart, engendering trust. In turn, these employees will create products and services that positively impact people and our planet.
Why Conscious Capitalism Works for Investors
And finally, purpose-driven companies will attract purpose-driven capital—those investors, both institutional and individual who are looking for social and environmental impact alongside financial returns. Whether it's the 7.2 trillion-dollar behemoth that is BlackRock, or the Millennial and Gen-Z investor wanting their 401Ks to be invested in line with their values; these are valuable stakeholders for the modern-day CEO to understand and collaborate with.
We Deserve a Better Model
Americans deserve an economy that allows each person to succeed through hard work and creativity and to lead a life of meaning and dignity. We believe the free-market system is the best means of generating good jobs, a sustainable and robust economy, innovation, a healthy environment, and economic opportunity for all.
Businesses play a vital role in the economy by creating jobs, fostering innovation, and providing essential goods and services. Companies make and sell consumer products, manufacture equipment, and vehicles; support the national defense; grow and produce food, provide health care; generate and deliver energy; and offer financial, communications, and other services that underpin economic growth. Conscious capitalism with purpose at its foundation must now inform all aspects of business, the economy, and society as a whole.