Social Entrepreneurship : How Conscious Capitalism Is Changing Business

John Mackey, Cofounder and Co-CEO of Whole Market, Believes in "Conscious Capitalism" (pp. 29 & 30)

“Those of us alive today can choose to lead the most meaningful lives humans have ever led” is a famous quote from Lynne Twist. Today, our world and economy is thriving like never before. We live in a society that has incredible opportunities to change the world for the better. With the advancement in technology, knowledge, and resources, our economy in a place it has never seen before. According to Doug Levy’s presentation on Conscious Capitalism, Capitalism has been the major factor in ending poverty in our world. If current trends continue at the rate they do today, extreme poverty will be nearly eliminated over the next few decades. In the texts Conscious Capitalism by John Mackey and Raj Sisodia, The Art of Servant Leadership by Tony

According to John Mackey, Co Founder and Co-CEO of Whole Foods Market, “Conscious Capitalism”, refers to a business that serve the interest of all major stakeholders-customers, employees, investors, suppliers, the larger community and the environment (Mackey, 2011). Mackey acknowledges and shares the complex and comprehensive perspective of Conscious Capitalism (Mackey, 2011) Mackey terms this way of thinking “Conscious Business,” which he summarizes into four key principles: High Purpose, Stakeholder Interdependence, Conscious Leadership and Conscious Culture. According to Fox (2011), a conscious culture is needed within an organization to fulfill the higher purpose of the organization.

The following is an analysis of information gathered from an interview with John Mackey, CEO of Whole Foods Market and coauthor of “Conscious Capitalism”. The objective of this analysis is to discuss the higher purpose of business. During the interview, Mackey offers his ideas on creating value for all stakeholders of an organization, not just the investors. Next, he explains how being more conscious in business will ultimately create a “win, win, win” scenario. Additionally, the differences between corporate social responsibility and conscious capitalism are clarified. This analysis will also describe the benefit of a balance between government regulations and the ideals of laissez faire business. Lastly, the following analysis will elaborate on the author’s suggestion that conscious businesses will outperform others in the 21st century.

Helm, B. (2013, April 12). WFM' John Mackey calls for a new kind of conscious capitalism . Retrieved January 17, 2016, from http://www.inc.com/burt-helm/john-mackey.html

By engaging with social causes in a variety of ways, a corporation can learn about new territories, product applications, cultures, and markets. Many companies seek to empower the poorest sector of the population, both at home and

According to Anderson (2015), organizations with no consciousness are outperformed by those companies who want to do business with some thought toward what is right and altruistic. Anderson (2015) identifies four key principles of Conscious Capitalism, which include:

Corporate social responsibility(CSR) is an obligation to make choices and take actions that will contribute to the welfare and interests of society, not just the organization. Many businesses are started to create a better world by helping to have more focus on the effect of environment on society than generating money. The idea includes Conscious Capitalism, Sustainability, and Benefit Corporation. Conscious capitalism is the organizational policies and practices which help in enhancing the success of a company and improve the economic and social conditions of the communities in which the company operates. The concept is developing strategies to embrace the philosophy. It gives higher preference to communities, employees,customers,and suppliers

Alka Srivastva studied the potential behind noble intentions and actionable social purpose. The reciprocal relationship between ethical behavior and value based activities depends heavily on the entrepreneurship mindset, personality, and economic values. Meaning entrepreneurship, when broken down, is about the person, act, and business entity. Alka Srivastva discovered 6 traits that he deemed universal of those traits the most impactful appeared to be reinvention, reverberation, and value lead direction. It is important for the organization to have high moral quality, in other words the word noble is used as a qualifier and a verb to the governing influence philosophy. Noble goes beyond the simple statement to action. (Srivastva, 2004)

It allows for social change advocacy without the potential external consequences of "conventional activism." But increasingly, we are led to believe that ‘entrepreneurs’ and ‘social enterprises’ are the avant garde of ‘change making’. Like every concept has both pros and cons, similarly even social entrepreneurship has its own demerits. On one hand it is one major factor in bringing change while on the other end it is being overused by companies who start off with the motive of being socially responsible and use this for the advantage in future ,by diverting their focus on profits. The point is, all of a sudden, social entrepreneurship was everywhere and everyone wanted to be one. The key to sustainable capitalism is reasonable profits as opposed to maximizing profits. In the current system, a segment of society is trying to maximize profits without concern for the impact on the well being of the society as a whole, while another segment of social organizations have to deal with the fall out. The system is not working. If it does good in some areas it also does bad in others. The example of Toms one for one shoe program though does charity and is a social enterprise but at its worst, it promotes a view of the world's poor as helpless, ineffective people passively waiting for trinkets from shoe-buying Americans. While the shoes themselves probably won't lead to any kind of disaster, that worldview can lead to bad policies and real, serious harm also has a small negative impact on local markets. And so I have come to feel increasingly uncomfortable with the term “social entrepreneurship” and its main actor, the “social entrepreneur”. It creates a false separation between “this is where we make money, and this is where we do good”. And that is exactly what is wrong with capitalism today. Myths of social entrepreneurship are different from what and how it really works in the

social entrepreneurs in their efforts to start a successful venture. This book is for someone that wants to learn useful skills on how to run a social enterprise that generates profits and alleviates social problems. The book outlines the purpose of a social enterprise, which is to address a social problem and how to generate revenues. It seeks to help someone that is interested in taking this journey to understand how to create an enterprise that is self-sufficient and sustainable. There are goals included to help navigate through the process, how to develop the concept and how to deal with uncertainty. It’s the uncertainty of the idea that social entrepreneurs choose to tackle intractable social issues, sometimes they have to operate in or create a market that does not yet exist, and they work in environments that generate uncertainty and present challenges.

Capitalism is the concept of which private corporations strive upon and expand their profits. This is the belief, which most Americans live by in the United States of America. The opportunity to make as much money as possible before their time runs out and gain enough pay to meet their goals and carry out their long term dreams. This philosophy is what makes company’s thrive everyday and sell their products and services to consumers in a competitive market. This is why capitalism is often referred

Is the deception of consumers worth making a profit? The Ford Pinto, popular car of the 1970s, made a profit off of a vehicle that endangered the lives of hundreds of people. In his essay “Pinto Madness” Mark Dowie, author and Pulitzer Prize nominee, exposed the unethical decisions made by Ford Motor Company. When it came to their customer’s safety and profit for the company, Ford made a decision that led to consequences their customers had to pay the price for. Should the business be held accountable for these actions? In his essay “The Social Responsibility of Business Is to Increase Its Profit” Milton Friedman, powerful economist, discusses what a business should prioritize in the economic system. Friedman declares what a business is responsible for and the guidelines they must follow. Due to Friedman’s view, he would not have condoned the actions and decisions that the executives at Ford Motor Company took.

Social entrepreneurship is gaining such strong interest in nonprofit world because of the economic challenges that have plagued this sector with cuts in philanthropic and government funding. According to Nash (2010) not only are there cuts, there are many organizations vying for the limited funding. Studies support, the attitudes in capitalistic America, and the ease of nonprofits to embrace this concept; evidenced by their ability to sell their once free services, to meet the demands of the consumer. According to the IRS (2010) nonprofits have increased their selling power on unrelated business income, to the tune of 184% increase, in a sixteen-year time frame. This writer, believes these numbers are evidence which support this trend is

Sustainable development is defined as “Development that meets the needs of the present generations without compromising the ability of future generations to meet their own needs” (IISD, par. 1 ).