19 December 2015

The Real Capitalism

When I first set out to write about my viewpoints on business almost six years ago, the one that was always closest to my heart was its potential impact.  In my opinion, the capitalistic approach is the best way to allocate resources, improve society,  and solve the world's problems.  And while I have written about microfinance, corporate and individual philanthropy, and social enterprise over the years, I feel I have never given it as much importance on the site compared to my conviction.  Unicorns were simply more sexy to write about and read.

First off, the double bottom line makes sense for companies.  I would want any strategist in my company thinking about how to reach consumers by solving fundamental issues.  Vodafone did it with mobile devices in Africa.  Unilever does so in India.  Google has single-handedly improved the standard of life for almost every person on the planet by giving them access to information once only held by the elites.  And these companies have dominated their industries and made gobs of money doing so.

I'm not moved by so-called "capitalists" that use their power to skim off the top to line their pockets.  The barbarians at the gate were just that.  The current political system is riddled with personal agendas that make me sick to my stomach.  To me, real capitalists are entrepreneurs that either bring new products and services to market or help lower costs or improve access for consumers.  Companies and systems that are profiting simply by their stature will not last in the long-term.  You see, for example, wall street continues to see their proprietary trading and advisory businesses decline as new entrants and models come to market.  In another example, the sharing economy is systematically taking money out of monopolistic or inefficient industries and giving it to consumers.  The tide is turning and will continue to do so as long as entrepreneurism is embraced.

Corporations are such an important facet of the world that it only makes sense to work in collaboration with governments and NGOs to accelerate social progress.  Corporations are one of the largest sources of revenue and should demand better conditions within their footprint.  Non-profits have the mission and access to serve, while corporations have the chops to measure, execute, and run programs efficiently.   Some of the most critical problems such as education, healthcare, poverty, and climate change will not be solved in a vacuum by one of these groups.  The only way to crack these complex problems is to harness the power of corporations, governments, and nonprofits into a common path.  This will lead to not only a sustainable, happier planet but also provide a stable environment for cash flows of businesses.

I'm optimistic in where the world is now as there is more momentum around capitalism's ability to serve.  Fortune magazine published their first "Change the World" list of companies this year.  Industrialists such as Bill Gates rival predecessors of the past in deploying their vast financial and operational resources to improve the world.   The millennials place more importance to company missions more than any generation in both in choosing where to work and whom to buy from.   New companies simply incorporate social efforts into their everyday business.  All the while, the strength of for profit impact ventures as well as NGOs continues to accelerate.  While governments continue to lose their ability to help due to political turmoil and budget constraints, it's good to see more power and emphasis shifting to those groups that can move quicker and more effectively.

I'll be taking a bit of a hiatus from writing due to my own constraints, so I wanted to make sure I wrote about this important topic.  I'll return when I have a more time to dedicate to writing and perhaps under a new more sustainable platform of my own.


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