At age 32, when I announced on a phone call to my mother
that I was starting a business, the line seemed to go dead. My mother, whom I
love deeply, is not someone you would call business-friendly. As a retired California
social worker and occasional head of her local Democratic Party, she distrusts
big business.
She isn’t alone.
Business in America, according to the book I’m about to
review, has an approval rating of around 19 percent, two points above Congress.
My father, on the other hand, a retired CPA and mall
developer, admires business. When I was still in high school I remember him
telling me, “Profit is one of the
most beautiful words in the English language.” He regularly complained about
anti-business prejudice in the media and academia. As I was setting off to
graduate school in sociology, he told me to enjoy myself, “but don’t believe
everything your professors tell you.”
My parents divorced when I was six.
My mother had hoped I would become a doctor or teacher, as
was customary on her side of the family. My father had already abandoned hope that
his journalist/consultant/analyst son would ever become an entrepreneur, and so
was delightfully surprised when I made the same phone call to him. He called me
his “late-blooming son.”
As a product of both my parents, I set out in business somewhat
conflicted. Serving customers felt natural and good, but to survive in business,
would I have to be ruthless? With degrees in biology and sociology, my
education was devoid of business courses of any kind. Did I miss out on
learning how to be hard-nosed?
'Give capitalism a chance'
In the early months of Levenger, working out of our
townhouse in Boston, Lori and I had plenty of days with no sales, and one day I
shall always remember, with just one sizable return—that is, a negative-sales
day.
Was it too late to become a doctor, I wondered?
Yet in our fledgling business I
did feel I had finally found my calling. (I discovered this with the help of
another book called Minding the Store
by Stanley Marcus, who taught me that being a merchant could be a noble thing.)
After a dicey first two years of
taking no salaries, success came dramatically to our company. During those early
years of success, I would hear business executives speak at charity events
about the importance of “giving back” to their communities. I chafed at this.
It implied that business was taking and that we business people, like
criminals, had a debt to repay.
Yet I watched our own business employ
people, help them grow in their careers, make our suppliers happy, keep our
accountants busy, and give our customers something that, judging by the many
heartfelt letters we received, they had been yearning for.
How could this be a bad thing?
One day a promising young
customer service rep at Levenger who was about to graduate from college came to
see me. She told me she was quitting Levenger to work for a nonprofit, because
she wanted to do good in the world. I said I was sorry to lose her but
understood that people must follow their hearts. I suggested that it was also possible
to do good in the world while working for a company. I even gave her some examples.
But she wasn’t buying it.
As we parted, I said with a smile
that I hoped she would “give capitalism a chance.” She laughed, as did I, but she
left the company anyway.
From profits to purpose
If the new book Conscious Capitalism: Liberating the Heroic
Spirit of Business succeeds in changing the world the way the authors hope,
my remark about “giving capitalism a chance” will no longer be a joke. Because future
young people graduating from college will just assume capitalism can do good in the world. They won’t think they
have to join a nonprofit to follow their hearts.
They will understand that a
“for-profit” company can just as easily be described as a “for-purpose” company,
and that profits are one way, and sometimes the best way, to sustain noble work.
At present, though, that future seems
far off.
That’s why John Mackey, the co-CEO
of Whole Foods Market, and Raj Sisodia, a professor of marketing at Bentley
University, wrote this new testament of business. They named it after the
movement they helped found, Conscious Capitalism.
Its credo begins with this
sentence:
We believe that business is good
because it creates value, it is ethical because it is based on voluntary
exchange, it is noble because it can elevate our existence, and it is heroic
because it lifts people out of poverty and creates prosperity.
Part of the problem, explain the
authors, is an image problem. Corporate malfeasance,
real and fictional, gets lots of play in the news and movies, while the
goodness of business does not.
But most of the problem is more
invidious.
The noble purpose of business has
been hijacked. And this hijacking is not the work of cynical professors and
journalists, but of business people
themselves who willingly share the myopic belief that business is, first,
foremost and finally, about profits.
The economist Milton Friedman, in
his widely cited 1970s essay on social responsibility, claimed that profit was
the only social responsibility businesses had. Too many people have interpreted
his advice too narrowly, to everyone’s detriment. Mackey and Sisodia convincingly
demonstrate that it simply isn’t true. Businesses that focus first on purpose,
and then expand their view widely to benefit all stakeholders—rather than just
narrowly serving shareholders—are better businesses, and better by all financial measures.
Unfortunately, write the authors,
capitalism “developed in a stunted way, missing the more human half of its
identity.”
The 70% solution
One of the most serious
consequences of this dwarfed manifestation of business is that the average
engagement of workers in the United States hovers around 30 percent. Some 7 out
of 10 workers just aren’t that into their jobs. Think of the opportunities for
everyone if those ratios were reversed.
It is the job of business leaders
to help engage that lost 70 percent, and to help employees realize that in
their hands—and hearts—lies the basis for the positive transformation of
societies and communities.
The authors of Conscious Capitalism ask us to imagine a
business “built on love and care rather than stress and fear,” a business where
staff members are able to “craft a purposeful life while earning a living,” and
where employees can experience “the joy of service, of enriching the lives of
others.”
Even if you aren’t
a doctor or a teacher.
Conscious Capitalism:
from good to great
It’s a different way of thinking
about business. Instead of viewing situations as tradeoffs (high wages leads to
lower profits), the authors advise that we think in terms of mutual wins: living
wages lead to happier staff members, which creates happier customers, which
generates higher sales, which results in satisfied shareholders.
Conscious Capitalism is a good book. It’s well-researched, well-written
and has already received favorable reviews in major publications. But what is exciting
is its potential to become a great book—the kind that triggers a fundamental
and pervasive change in attitudes.
Could Conscious Capitalism do for business what Silent Spring did for the environment?
The widespread view of capitalism
as some sort of necessary evil is a kind of DDT to human potential. Breaking
into an enlightened conception of capitalism could liberate human potential,
leading to new levels of innovation and personal fulfillment.
But as powerful as Conscious
Capitalism can be, it is not an elixir for business success. The most
enlightened capitalists must also go through the hard work of developing an
effective corporate strategy—that long and difficult process of examining
options and selecting the very few to pursue. Then comes execution, a topic
that rightfully has filled volumes of business books and launched the careers
of untold numbers of business consultants.
Just as essential, in order for Conscious
Capitalism to be sustained, it must be embraced by the current generation of
young people starting businesses today. Only if they take it up—which they will
do in their own ways—does the movement have a chance to change the world.
There are promising signs.
Tearing down the Ivy Curtain
More colleges are focusing not
only on entrepreneurism, but on social entrepreneurism. Students will do their
own mashups to create businesses that feel like nonprofits, and nonprofits that
are run like businesses.
I’m hopeful that students will
tear down the Ivy Curtain that for my generation separated the so-called impractical
liberal arts from majors like business and accounting. I’m hopeful that we’ll
see more business students with their heads in the clouds, and art-history
majors who like accounting.
My own sons, college classes of
2010 and 2013, are reading Conscious
Capitalism, so we can discuss it as a family. Already they’ve let me know
it seems rather obvious to them.
And maybe that’s our best hope—that
young people setting off in business today will just assume capitalism can do
good in the world. “Like, duh, Dad.”
I hope so. And I hope when they
call my mother to tell them about their businesses, the conversation will be
anything but silent.
Now to you, dear reader: Does Conscious Capitalism make
sense to you? I’d love to
hear. Just
click on the Comments link
below with your submission. (If you’re reading this as an email, click here and you’ll connect to
Comments.)