Conscious Capitalism

On Thinktopia I read this article about Conscious Capitalism. I’m a strong believer in the foundations of Conscious Capitalism, but there are some pitfalls that aren’t addressed (good enough) yet.

Conscious Capitalism focuses principally on the recognition that every business has a purpose beyond the firm. It’s no longer sufficient for a company to service itself and its direct stakeholders. Or as Jeff Klein says in the article:

“Rather than seeing business as a tube (money in, money out), we look at business as an ecosystem of interdependent interrelated stakeholders. For stakeholder management, the business has to produce profits over time, but that doesn’t mean that’s its sole purpose. For the business to be sustainable flourish and resilient, it needs to focus on the whole rather than its parts. Corporations have often serviced the societies in which they flourish. Their primary purpose was nota bout making money, but serving their stakeholders.” – Jeff Klein

We’re looking for entrepreneurs that want to design a value-driven, sustainable world. This asks for profoundly changed business models and ethics.

“The next generation really gets this. They understand that being a conscious business leader means leading in a conscious way – not just environmentally but also being conscious of social and economic justice issues. And understanding that it takes a lot of diverse perspectives to tackle the big problems we’re facing.

We’re a lucky generation living at a lucky time. We have a movement mentality, and we understand we have to work together. Nobody has that much experience and if you have skills and if you understand the mission, you can really rethink, redesign, rebuild everything.” – Deb Nelson

As Polak points out in the article, the big challenges for conscious companies are authenticity and designing for scale and market instead of designing a scale or a market. This is where it gets more difficult.

“As the new recession has demonstrated, it is difficult to survive serving the richest 10%of the world’s customers. At the same time, the world is reaching its capacity, and providing a ceiling to continious growth.

Not that the existing ones (multinational corporations) are inherently good or inherently bad, but the market structure has evolved.” – Polak

By creating a legal description like B corporations, you give these organisations an easy shot at differentiating themselves from ‘traditional’ companies. However, it’s very easy to turn the B corp-description into a marketing tool that’s completely hollow and meaningless. A company could be working on poverty while paying out big bonuses to their managers is not aligned with its fundamental principles. But since this company is working on social issues, it could very well be a B corp.

The second challenge is that of growth. At this point, organisations have to grow in order to show us they are doing well. When dealing with a certain problem within a big global challenge (say clean water in Rural India), in the end, you should be aiming to make yourself unnecessary. You have to invest time and money with the aim of going out of business once your challenge is tackled. Your company should be able to change its core business every time you tackle a problem. The smaller the problems, the faster you can move. Corporations nowadays are not built to focus on temporary projects.


About leyssensjan

Jan Leyssens is a designer and entrepreneur who strongly believes you can’t turn sustainability into a positive story if your main focus is on negative impact. When designing, he is always looking for the overlap between activism and entrepreneurship, technology and community. His main expertise lies in strategic business model development, Circular Economy, the makermovement, and social innovation. With a background in Industrial Design, Jan quickly shifted his focus towards business design and using the design process in strategic management. Jan is the father of two kids and founder & CEO of Regenerative Design, co-founder of Full Circle, ImpactBoost, and the Circular Design map, podcaster, storyteller, and changemaker.

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