Defining success in business has long followed a familiar set of unyielding maxims: The sole purpose of business is to make a profit. Entrepreneurs are beholden to no one but shareholders. It’s a CEO’s obligation — even legal and sacred duty — to squeeze partners, employees and the environment in which the business operates for every last shred of gain.
This definition of business leadership, maturity and success has gone largely unchallenged the last 25 years — which is amazing, considering that it’s now being exposed as provably wrong.
People have sensed something wrong at the center of business thinking for some time, even before the field’s best and brightest brought the world financial system to the brink of ruin in 2008, and even before the costs of business “externalities” started to take a global environmental toll. But is there an alternative short of renouncing capitalism altogether and spending our days parading giant protest puppets through the city? It turns out there is: a framework for business that recognizes capitalism’s potential to be a force for good, not destruction, while still making a profit.
Evidence of this shift has taken many forms, such as the rise of Impact Investing and B-Corporations, but the best place to get oriented is Conscious Capitalism. An early catalyst of the movement, Conscious Capitalism includes a website (www.consciouscapitalism.org), an annual conference, national and international chapters, a roster of successful supporting companies (such as Whole Foods Market and The Container Store), and a book by John Mackey and Raj Sisodia that lays out the principles and — crucially — the results: Conscious companies consistently outperform their traditional peers financially, sometimes by a factor as high as 10x.
The principles that drive these returns are easy to grasp, because they just happen to correlate with our innate sense of doing what’s right: Making sure all stakeholders — not just shareholders — are rewarded and grow along with the business; prioritizing sustainable long-term value creation over the quick-hit quarterly goal; ensuring that purpose and culture drive profit, not the other way around. The result: better returns by almost any measure.
Keiretsu Forum Northwest is right in the midst of this evolution via its Impact Investment committee, the use of an impact badge on qualifying opportunities, and the annual Impact Investment forum organized by committee chair Kevin Owyang. Held just last month, this year’s forum had many in the room who were new to this way of doing business. Other attendees already viewed it as mainstream, and in fact the only way to do business right. If you’re in the first group, I encourage you to get into the second as fast as you can, because this evolution in business thinking is profound, powerful and accelerating.
Hans Bjordahl is CEO of Culture Foundry, a Keiretsu member and digital services firm which creates beautiful technology in the form of websites and applications for such clients as Bonnie Raitt, Home Power Magazine, Esalen Institute, Churchill Downs, Jackson Browne, SolarPro Magazine, Humanosphere, and Crosby Stills & Nash.