Social responsibility is just good PR. Markets cannot be leveraged for social good, and should not be hijacked to solve the world’s problems. Face it, the benefits of capitalism accrue to the few, the smart, the lucky, the connected. That’s the way the system works.
Much needed reality check, or utter hogwash?
Businesses can better scale solutions to social problems says Michael Porter in his recent TEDTalk, because profit and resources are the magic missing from government and nonprofit work.
Don’t trust markets with our civic life counters Michael Sandel in his TEDTalk because profit shifts values and monetizes social good.
The disparity between the haves and have nots is more extreme than ever, and capitalism as it’s now practiced is not working for the vast majority argues Chrystia Freeland in her TEDTalk, The rise of the new global super-rich.
Banker to the Poor, Muhammad Yunus, says businesses can better solve social problems than NGOs. This, he argues, is the solution to the world’s problems. Lots of small social businesses doing good while doing well enough to sustain themselves (but not a penny more).
I’m the co-founder of a business created to help solve a social problem. I support fair trade and balancing people, planet and profits. I believe in prioritizing the common good over maximizing personal profit and shareholder value.
But don’t mistake me for a naive do-gooder. I grew up in a business, have owned three companies myself, and sold one for a profit. I like building businesses that deliver great products and service. And I happen to believe that business can and should play a bigger role in solving the world’s problems. But convincing consumers, investors and even friends of the value of embedding social good in those products and services is a never-ending and often frustrating battle. You get blank stares and a lefty-socialist-redistribute-the-wealth sticker on your backside. That’s just not me.
But I do think we need a major update to capitalism. And so do a lot of other people. If we don’t, billions will suffer, die, or rise up in protest. Global business has done more to lift people out of poverty and promote shared prosperity than anything else the world has ever conceived of. Apologies to the anti-globalization folks – you’ve got strong and troubling points. I’ve seen the worst effects up close. But we need to all acknowledge that trade works – it just needs to work better, more fairly. Benefiting the many, not the few.
We all understand that capital naturally flows where frictions are lowest, and that as the Economist puts it, “finance has yet to meet a rule it doesn’t want to game.” But seriously, let’s look beyond bonuses and maximizing shareholder value for a moment, stop blaming policies for risky behavior, and think about the future from a global perspective. Inject a dose of common good into our decision-making.
What’s really missing are people who actively embrace the idea of shared prosperity as a way of life. Shoppers, investors, nonprofits, businesses, governments, leaders. You. It’s time to shatter traditional notions of for-profit and not-for-profit. Break down the divide, merge the best of both. I vote for solutions with real and lasting impact. Markets that work for everyone. Charity as a catalyst for change, not the solution itself. I vote for capitalism as a force for good.
How do we make that happen?
