Cultural Commitment / Conscious Capitalism

As my voyage of cultural curiosity continues, this week saw me attend an event hosted by proponents of a movement called ‘conscious capitalism’ — and it was awesome.

So, what is conscious capitalism?

As best as I can summarise, conscious capitalism is a philosophy that says the current and prevalent version of capitalism, which has thrived all over the world, is fundamentally broken.

The argument goes that capitalism, in theory, was a good idea: A system designed to benefit business, but importantly also the societies and communities surrounding those businesses. Over time though, capitalism seems to have lost its way. Companies are now too often motivated by profit and are ignoring their responsibility to provide broader value to the societies in which they operate.

In a nutshell, conscious capitalists seek to flip the focus of business, deprioritising profit in favour of working towards a higher purpose. Examples include: Intrepid travel’s mission to enrich peoples lives through travel that benefits local communities, or MECU, a cooperative bank whose purpose is to enhance the economic wellbeing that is responsible to the community.  For Intrepid this means engaging surveyors to measure the impact that tourism has on communities — from the families who billet backpackers to the food venues who feed them.  For MECU this means sustainability initiatives like planting a tree every time a car loan is approved, or funnelling resources and funds into their Land Bank project.

Conscious capitalism sets out a nice simple framework, one that will help you to develop a new business or perhaps reorganise and rethink an existing one. The four ingredients for a conscious business are:

A higher purpose: Conscious businesses need to adopt a higher purpose, one that transcends profit maximisation.

Stakeholder orientation: A conscious business will develop practices and maintain a value chain that benefits all of its stakeholders and dependents within its ecosystem – this includes staff, customers and their suppliers.

Conscious leadership: A purpose and conscious business needs the passion, vision, inspiration and tenacity of leaders.

Culture: Conscious businesses need to establish and foster a culture (values and behaviours) that supports the vision, purpose and stakeholder strategy.

Nice, eh? And conscious capitalism seems to actually work too. There are lots of examples of brands that have been very successful as a result of embracing a conscious capitalist approach. These include Wholefoods, Patagonia and Intrepid travel to rattle off just a few.

As far as outtakes go, conscious capitalism is a nice big juicy idea. It makes you reexamine what business is for. This is remarkable particularly for a guy who works in an ad agency, and I think there are some incredibly interesting lessons in what this movement is telling us about business, culture and leadership.

I found the most interesting element to be the purpose and stakeholder components of the model — something we spend a lot of time thinking about when developing strategies for brands.

To that end, I started mulling over how an advertising agency might operate in a (more) meaningful way: Perhaps the agency’s main focus could be on pro-bono work and it would work only with clients and production companies who embraced sustainable practices. But would that then attract paid clients through its doing of good?

Furthermore, considering its stakeholders, would a conscious agency employ people from lower socio-economic backgrounds, or outsource to communities where there is mass unemployment (Europe for example)? When you put it into terms like this, you can see that even a business with great intentions might find it challenging to establish or sustain itself because the ecosystems and structures aren’t necessarily as accessible or even practicable.

But I think conscious capitalism is something to get excited about. Momentum is definitely growing behind it and only the stupid or arrogant would ignore that consumers are seeking greater authenticity from brands and are demanding transparency about their practice.

Andrew Reeves

Communications and Digital Director

Naked Melbourne