Recently, I came across this speech of Peter Bakker, the President of the World Business Council for Sustainable Development (WBCSD). The former CEO of TNT, now leading this organization with more than 200 corporate members, pledges for a revolution of capitalism, in order to adress the most pressing challenges of our world : poverty, hunger, climate change… What would be the conditions for such a revolution to happen ? You can check out WBCSD vision to see what this organization stands for. As far as I can reflect on that topic, I can see at least three necessary conditions : acknoledge people not only as customers or employees, make big changes in governance and metrics, lead the inside revolution.
Acknowledge People not only as Customers or Employees
So far, strategic corporate intents towards alleviation of poverty has been seen mostly as a way to gain more customers. I appreciate “Bottom of the Pyramid” initiatives or social business ventures between corporations and NGOs, but I think that business leaders also have to understand that not everything in life is business, that some areas have to be business-free, just like New York planners created Central Park to allow the city being livable by people. This means that companies have to respect some natural and human limits. These limits are more than obvious now in the case of natural resources, but it seems that we lack a better understanding of what human ecosystems limits are. As Majid Rhanema puts it in his remarkable book, too often the logic of business has been to make a common good scarce in order to be able to sell it afterwards. What if businesses put into their mission statements the goal to contribute in restoring life in the human ecosystems they operate with ? This would enlarge dramatically narrow-minded views of what a customer is or what an employee is capable of.
Make Big Changes in Governance and in Metrics
The first condition leads to the second. In the United States, CEOs of public corporations have an obligation – by law – to maximise shareholder value. This is crazy. Maximisation does not equal optimization. The B-Corp movement tries to promote a different way of looking at the role of a company. No matter the legal status of a company or the country it is operating in, nothing is possible without a real change in governance and metrics. Governance has to include more and more the communities that the company is dealing with or whose resources it is using (employees, customers, education systems, NGOs,…). Metrics – at the highest level – have to incorporate societal metrics (in the spirit of what Danone introduced a few years ago for its top managers).
Lead the Inside Revolution
Behaviours come from deeply rooted mental models or beliefs. Corporate world cannot play any role in changing the world for good if it does not start with looking itself in the mirror. It will not only see fantastic team power or radical innovation. Corporate world is also full of pain and suffering. Corporate world is a world where some basic human rights are denied. I am not talking here of the plague of slavery that too many people endure in different parts of the world. I am talking about the fear to speak openly in meeting rooms or offices because of powerful hierarchies or processes that destroy human creativity, and sometimes dignity. Liberated companies exist, their outstanding successes have been largely documented. Can businesses really consider contributing to solving the biggest challenges of the world if they do not change a 150-years old mentality ? Do mindsets inherited from the Industrial age has a lot to offer to peer-to-peer networked societies that prevail today ?
These three conditions might look utopian given current views and habits prevailing in the business community. Nevertheless, recent evolutions in leading companies across various industries indicate that they are much more than fads. As Peter Bakker states it, this revolution is not about destroying capitalism, but about “making big changes in a short period of time”. Companies would be well inspired in not paying lip service to putting in place these conditions. If they do not show very fast an authentic and efficient committment towards a betterment of the world, they will keep on destroying not only shareholder value, but also what is the basic element in which capitalism can be alive : trust. Such a destruction could lead to a very different kind of revolution : a revolution that nobody can desire, except extremist politicians or regimes.