Reforming Capitalism
Conscious Capitalism

What is Conscious Capitalism ... the definition from Australia

Burgess COMMENTARY

Peter Burgess

What is Conscious Capitalism

The 20th century witnessed a lengthy battle between polar opposite views of how to organize and regulate economic activity. Although free market capitalism won that epic struggle decisively, it failed to capture the minds of intellectuals and the hearts of citizens. Corporations are probably the most influential institutions in the world today and yet many people do not believe that they can be trusted.

Conscious Capitalism is a philosophy based on the belief that a more complex form of capitalism is emerging that holds the potential for enhancing corporate performance while simultaneously continuing to advance the quality of life for billions of people. The Conscious Capitalism movement challenges business leaders to re-think why their organizations exist and to acknowledge their companies' roles in the interdependent global marketplace.

Today's best companies get it. From Zappos to Whole Foods, the Container Store to Google: they're generating every form of value that matters: emotional, social, and financial. And they're doing it for all their stakeholders. Not because it's 'politically correct'; because it's the ultimate path to long-term competitive advantage. Conscious Capitalism differs from Corporate Social Responsibility (CSR) by virtue of its origins from within the company as an expression of an overall perspective on how to conceive and build a business, rather than as a response to external notions of what counts as 'socially responsible' or external pressure. Conscious Capitalists are unapologetic advocates for free markets, entrepreneurship, competition, freedom to trade, property rights, and the rule of law. They recognize that these are essential elements of a healthy, functioning economy, as are trust, compassion, collaboration, and value-creation. Conscious Capitalism is the system-level effect of a substantial number of companies practicing the four tenets of a Conscious Business as defined below:

HIGHER PURPOSE

Conscious Businesses adopt a higher purpose that transcends profit maximization. A compelling sense of purpose can create an extraordinary degree of engagement for stakeholders and catalyze tremendous organizational energy.

STAKEHOLDER ORIENTATION

Conscious businesses are explicitly managed for the simultaneous benefit of all of their interdependent stakeholders, including customers, employees, investors, suppliers, and the larger communities in which the business participates. Stakeholders comprise an interdependent and interrelated system, recognizing that by creating value for all of the stakeholders (in various and often differing ways) the whole system advances.

CONSCIOUS LEADERSHIP

Driven primarily by service to the firm's purpose, and focus on delivering value to the stakeholders, Conscious Leaders adopt a holistic worldview that moves beyond the limitations of traditional machine metaphors for business. They view their enterprises as part of a complex, interdependent, and evolving system with multiple constituencies. Conscious Leaders see that profit is one of the important purposes of the business, but not the sole purpose. Most importantly, they reject a zero-sum, trade-off oriented view of business and look for creative synergistic win-win approaches that offer multiple kinds of value simultaneously to all stakeholders.

CONSCIOUS CULTURE

Captured in the acronym TACTILE: Trust, Authenticity, Caring, Transparency, Integrity, Learning and Empowerment, the word tactile also suggests that the cultures of these companies are very tangible to their stakeholders as well as to outside observers; one can feel the difference when walking into a conscious business.

The Conscious Capitalism movement now includes an expanding community of CEOs and thought leaders globally. The movement has a fast growing presence in Europe as well as in Asia.