Conscious Capitalism

Conscious Capitalism

Transcript:

Good day everyone! My name is Sid Waichal and today I'm going to discuss about conscious capitalism.

So here is a quick agenda that I would like to discuss today: Conscious capitalism overview; Is it needed?; Does it work?; Ethics and conscious capitalism; and Conclusion. So what is conscious capitalism? Conscious capitalism as described by one of its founding fathers, John McKay, is purchasing profits while sincerely considering the interest of all stakeholders involved. McKay describes that businesses should operate ethically by serving the interests of all stakeholders involved and not just corporate management and shareholders.

He wrote a book on Concepts and founded the non-profit Conscious Capitalism Incorporated. There are four main principles that govern conscious capitalism which we'll discuss further in the next slides. The first principle of conscious capitalism is higher purpose. A business that adheres to the principles of conscious capitalism focuses on a purpose beyond pure profits. In doing so it inspires and engages its key stakeholders. The next one is stakeholder orientation. Businesses have multiple stakeholders including customers, employees, suppliers, investors, among others. A Conscious business concentrates on the whole business ecosystem to create an optimized value for all its stakeholders. The third principle is conscious leadership. A conscious leader emphasizes a we rather than a me mentality to drive the business.

By doing so they work to cultivate a culture of conscious capitalism in the enterprise. And the last one is conscious culture. Corporate culture is the sum of the values and principles that constitute the social and moral fabric of a business. A conscious culture is one where the policies of conscious capitalism permeate the enterprise fostering a spirit of trust and cooperation among all stakeholders. Now let's discuss if conscious capitalism is needed. And a quick answer is yes and here is why. So conscious capitalism offers a more comprehensive and holistic approach to the relationship between business and the society and it considers the needs of all its stakeholders and they are accountable to all. 

While conscious capitalism businesses still aim to make profits, they want to have a purpose and this purpose entails making a positive impact to the world. Stakeholders work together to reach win-win outcomes for the community, society, and the environment and providing everlasting value. Now all of this will be achieved without sacrificing profits but rather finding way to benefit everyone. Of course choosing the conscious capitalism path is both an investment and a risk but with designing good strategies and having support from top management across all organizational industries it will be worth it. Businesses that create a support and thriving ecosystem benefit greatly. Does conscious capitalism work? The answer is yes because there are studies that support this. Conscious capitalism is a concept that amalgamates the consumers and shareholders interests. Eventually the firm adopting this strategy realized immense benefits indicating that the process works. The process works when businesses wealth trickles down the economy. Consequently everyone in the economy will stand to gain wealth due to economic policies which will condense corporate taxes.

Some available research show that Whole Food Market company has implemented this strategy. As such they have gained an increased reputation due to their interaction with consumers. Also, marketing experts have Illustrated that businesses can implement this approach and it will satisfy stakeholders interest. Through rigorous research of companies like Southwest Airlines, Starbucks, and Whole Foods, Raj one of the founders of this principles, found that over a 15-year period conscious capitalists companies had investment returns of more than 1,646 percent; whereas, the S&P 500 companies did 157 percent over the same time frame. This finding alone should make the ears of his any business leaders perk up. Why conscious capitalism may not work? The primary purpose of conscious capitalism is to create a good relationship between the customers and the businesses. This means that the company should focus not on profits but on enhancing the relationship. As such, the investors interest would not be prioritized which will discourage .

Also this approach does not make structural changes in the enterprise. The approach focuses on enhancing relationship and not organizational structure which may have little impact on changing some demeanor in the firm. What should be done to enhance conscious capitalism? Conscious capitalism thrives on participation of stakeholders in the business. Here they should promote values such as transparency,  integrity, honesty, and trust.

These values create an environment where the business and the customers get along without many scruples. This slide explains benefits of conscious capitalism. Component to businesses so higher purpose which enhances goodwill and agreements, profits, stakeholder orientation, increased productivity, Conscious leadership inspires employees and enhanced goodwill. Conscious culture inspires employees and increases productivity. Now let's discuss how ethics and conscious capitalism are related. After discussing through previous slides and discussion about conscious capitalism, it can be interpreted that the conscious capitalism is a subset of ethics. Here is how I have derived this.

What is ethics? Ethics primary deals with individuals morals, principles, values, and how they interact with the social world and with the environment. Conscious capitalism is primarily following the ethical principles for doing in the businesses. In short, conscious capitalism is an application of ethical philosophies in business conscious capitalism has explained in earlier side is to create capability for an organization to do good deeds for the society another stakeholders who are interrelated and interdependent. Looking over these principles, it is very clear that whether a corporate is a local company or an international operator conglomerate, it is the
best interest to business ethically.

The four principles which is guiding conscious capitalism, higher purpose, stakeholder orientation, conscious leadership, and conscious culture, is impossible to achieve unless until it's supported by ethical values. It's fair to say that ethics and conscious capitalism is a backbone of industry today. Strong ethics should be ported by the leadership and should be seen in a company's culture. Corporate culture is a mix of customs, ideas,
rituals, and company values and shared meaning, which define the normal behavior for everyone who works in the company. Therefore a culture plays an important role in organization's ethics to keep up the ethical climate in the business. Without corporate values on culture a company cannot withstand a growth trajectory. Value should be part of company's mission and vision statement. Culture can provide a huge platform for a company's future progress path.

Organizations and stakeholders are both interconnected and interdependent. What affection affects one affects the other and all stakeholders are equally important. Organizations that practice conscious capitalism and have stronger ethics can see major benefits explained below. Employee satisfaction as they have a purpose and value to deliver. High employee motivation because they have reasons to believe that it's more than just money. Brand loyal customers who are motivated and attracted to a strong mission. More community engagement, better customer employee and stakeholder relationship, strong ways of brand for a company, more employee engagement, inclusivity which creates creativity. A company will adopt comprehensive policies and practices designed to nurture ethical decision making in all its spheres of influence from environmental impact and to social well-being. After analyzing some of the articles, it is needless to say that ethics and conscious capitalism are certainly pillars of business strength in 21st century. In conclusion, conscious capitalism is a viable form of capitalism that considers the social culture and environmental interests within its mainstream operation. It has stretched further beyond the mere profit that the current capitalism is all about.

Conscious capitalism is therefore beneficial to local community in its neighborhood, the employees, the environment, and other factors that contribute to the business success. As a result, it has proved to be the best approach that ensures sustainable development in the modern world characterized by over exploitation of resources.

Thank you!