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A Mindset Shift Towards Conscious Capitalism

Updated: Jan 28

by Sabreena Andriesz, PhD, MCC




Since the start of the industrial revolution capitalism has shaped the ways organizations make profit, businesses grow, and workers make a living. Free-enterprise capitalism is celebrated as the most effective and powerful system for social cooperation and human progress. The popular capitalist notion is that profiteering is healthy because as it is based on a voluntary exchange of services that creates value. It is considered integral to economic growth and the employment opportunities it provides. It could even be seen as noble because it elevates living standards and is a mechanism for future prosperity (Mackey & Sisodia, 2013).


This traditional framework is based on a model where the chain of services involved in the production of goods maximizes profit, but its negative impact and depletion of natural and human resources has only been fully realized in the last decade. An estimated 1.6 billion people worldwide lack adequate housing. (Habitat for Humanity, 2017), 192 million people are unemployed or underemployed (International Labour Organization, 2018), one out of nine people lack access to clean water, and one out of three people lack access to a toilet (WHO, UNICEF, 2021). Furthermore, one out of 10 people are malnourished, yet 13 billion tons of food produced globally get lost or wasted annually (Food and Agriculture Organization of the United Nations). These increasing shortages, levels of unemployment, homelessness and inaccessibility of clean water testify that capitalism has failed to progress humanity.


If all living systems are to continue to thrive, capitalism needs to change to one that is conscious of its impact on society, the world, and its future generations. The concept of conscious capitalism as a collaborative exchange of forces working together to create sustainable value for all stakeholders involved is not new and goes back to an indigenous philosophy of the seventh-generation principle. The ethos that underpins this tenet is that decisions made about our natural resources including energy and water must be sustainable for seven generations in the future.


The seventh generation principle holds high reverence for all life forms and a symbolic relationship with nature. The legacy of this ancestral wisdom crystallizes our sense of responsibility and relationship to all living things and all parts of the system. Most importantly, this concept asserts that human beings are not separate from their environment (Capra, 1996), This type of mindset urges us to think holistically about the impact of our decisions beyond the short-term and the nurture of stewardship as a global and cultural imperative.


If organizations were to adopt this ethos, the flavour of annual turn-overs would include building a workplace culture that espouses values driven leadership, collaborative partnerships and win-win-win proposition for all concerned. Organizations are no longer closed systems that operate independently to their environment. Similar to holons, organizations need to think interdependently not independently and see the environment as a part of its future growth and continued success. When businesses are able to articulate and align their visions to one that includes their higher purpose to society, employees are more likely to be engaged and motivated as they unite towards a common cause. This in turn is more likely to build solid businesses and stronger bottom-lines.


There was a time when this ethos might have been considered an idealistic notion yet organizations are increasingly beginning to adopt this systemic philosophy. Renowned brands such as Whole Foods, Starbucks, Google, Southwest Airlines, Ben & Jerry Ice cream, Panera Bread and Body Shop uphold best practices that mutually benefit their employees, stakeholders and the environment. In Singapore, well-known companies such as DBS bank, Visa and Shell are aligning their overarching corporate strategies to social causes. DBS for example, is a fervent supporter of social entrepreneurship, and provides seed funding to nurture the efforts of young change-makers interested in positively impacting their society and the environment. NTUC Income and Keppel Corporation contribute financially to improving the lives of the less advantaged and FoodXervices set up Food Bank Singapore in 2012. It is now run by over 900 volunteers and distributes approximately 60 tons of food per month to over 100,000 needy individuals (Yeo, 2016).


Within such organizations the conscious leader keeps in view the long-term gains and the short-term wins when setting the organizations strategic direction. They engage stakeholders both internal and external with the intention of co-creating joint value and partnership. Driven by values and purpose conscious leadership is about lifting and bringing out the best in each other. As they weave the social fabric of a business into one that is customer centric and caring for all stakeholder conscious cultures emerge. Businesses that adopt these conscious tents are more likely to outperform other companies because their ethos is mutually aligned and cause driven.


References:

· Capra, F. (1996). The web of life: a new scientific understanding of living systems, DoubleDay Publishing Group, New York New York.

· Clarkson, L, Morrissette,V., & Regalle, G.,(2001). Our Responsibility to The Seventh Generation Indigenous Peoples and Sustainable Development International Institute for Sustainable Development, IISD Publications, Winnipeg.

· Food Loss and Food Waste, Food and Agricultural Organization of the United Nations, 17th Jan 2022, retrieved from https://www.fao.org/food-loss-and-food-waste/flw-data

· Habitat For Humanity(2017).. Statement by Habitat for Humanity about the future of the United Nations Human Settlement. Retrieved from https://www.habitat.org/newsroom/2017/statement-habitat-humanity-about-future-united-nations-human-settlement-programme-un

· Mackey, J.E., & Sisodia, R. (2013). Conscious Capitalism: Liberating the Heroic Spirit of Business, Harvard Business Review Press, New York.


· Thomas, C. (2020) Companies that practice conscious capitalism, Hub Pages, 17th Jan 2022, retrieved from https://discover.hubpages.com/business/What-is-Conscious-Capitalism-Examples-of-Companies-That-Practice-Conscious-Capitalism

· World Employment Social Outlook: Trends (2018). International labour Organisation, ILO publications, Geneva.

· World Health Organization (WHO) and the United Nations Children’s Fund (UNICEF), 2021. Progress on household drinking water, sanitation and hygiene 2000-2020: five years into the SDGs. Geneva

· Yeo, J. (2016), Conscious capitalism: Making goodness the business of every organisation, June 18, 2016, ASEAN Today, retrieved from
https://www.aseantoday.com/2016/06/making-goodness-the-business-of-every-organisation/