The 4 Tenets of Conscious Capitalism
Want to make a difference in the world as a business? Follow these 4 principles.
Today, many businesses make money at the expense of others instead of creating value by advancing the quality of life for their community and the world. Companies should be striving to make an impact on the world beyond making revenue. But, sadly, we don’t see many businesses adopting this mindset.
Ed Freeman once said, “We need red blood cells to live (the same way a business needs profits to live), but the purpose of life is more than to make red blood cells (the same way the purpose of business is more than simply to generate profits).”
Enter the concept of Conscious Capitalism. This emerging movement exists to elevate humanity through business. The core belief behind the movement is the fact that there’s plenty of business for everyone that plays nice and plays by the rules.
Four businesses that exemplify Conscious Capitalism are The Container Store, Whole Foods, Zappos, and Southwest Airlines. All four of these companies put employees first and focus on providing an outstanding customer experience.
John Mackey, the founder of Whole Foods Market, runs the leading business of Conscious Capitalism. Whole Foods Market, founded in 1980 in Austin, Texas, and now consisting of 331 stores, embodies the ideals of Conscious Capitalism. The company has been listed as one of Fortune magazine’s “100 Best Companies to Work for” and was in The Wall Street Journal ranking as one of the world’s best corporate reputations.
Conscious Capitalism teaches business leaders to create shared value by making their companies more successful and competitive while advancing the quality of life for the community and the world.
Could also be called the “mission” of the company. It’s the higher purpose of the company beyond making a profit.
“While making money is essential for the vitality and sustainability of a business, it is not the only or even the most important reason a business exists. By focusing on its higher purpose, a business may inspire, engage, and energize its stakeholders.”
A sense of purpose can also foster a higher level of engagement from the stakeholders can help generate tremendous organizational energy.
Like life forms in an ecosystem, with the presence of healthy stakeholders comes a robust, resilient business system. Conscious businesses focus on their “whole business ecosystem, creating and optimizing value for all of their stakeholders.”
Zappos is making a dramatic contribution to their community by significantly revitalizing a “dead” downtown Las Vegas. By creating value for the stakeholders, the whole system advances, it’s a win-win proposition.
This is the idea that conscious leaders understand the higher purpose of businesses and focus on creating value for and coordinating the interests of the business stakeholders. When leaders are driven primarily by service to the business’s mission, rather than by power or money, they can “inspire, foster transformation, and bring out the best in those around them.”
The culture of Conscious companies can be captured by the acronym TACTILE.
T = trust. A = authenticity. C = caring. T = transparency. I = integrity. L = learning. E = empowerment.
Businesses that follow the idea of Conscious Culture is very tangible to stakeholders and outside observers.
The result of the combination of these four principles is Conscious Capitalism.
The employees for these companies are motivated to work harder, be more creative, and care for the customers. Long-term, trusted relationships with suppliers become a reality when following these four tenets.
Would your company benefit by following the four tenets of Conscious Capitalism?
If you’re interested, you can sign up for the Conscious Capitalism newsletter here.
“Practicing conscious Capitalism enriches your life and the lives of people you do business with. And it’s without a doubt, the most fun, enduring and profitable way to build a sustainable business. — Kip Tindell, Chairman & CEO, The Container Store, trustee, Conscious Capitalism, Inc.s