john mackey: why companies should embrace conscious capitalism · john mackey: why companies should...

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ENTREPRENEURS 1/15/2013 @ 9:00AM 31,866 views

John Mackey: Why Companies ShouldEmbrace Conscious Capitalism

John Mackey, CoFounder and Co-CEO of Whole Foods Market

I

recently spoke to John Mackey, who is theCoFounder and Co-CEO of Whole Foods Marketand Coauthor, with Rajendra Sisodia, ofConscious Capitalism: Liberating the HeroicSpirit of Business. Mackey has led Whole Foods asit’s grown from a single store in Austin, Texas,founded in 1978, to an $11 billion Fortune 300company, and a top U.S. supermarket with morethan 340 stores and 70,000 Team Membersworldwide.

While devoting his career to helping shopperssatisfy their lifestyle needs with high qualitynatural and organic foods, Mackey has alsofocused on building a more conscious way ofdoing business. For 15 consecutive years,FORTUNE magazine has included Whole FoodsMarket on its “100 Best Companies to Work For”list.

He has been recognized for his work over theyears by being named Ernst & Young’s “UnitedStates Entrepreneur of the Year,” andFORTUNE’s “Businessperson of theYear.” Mackey co-founded the ConsciousCapitalism Movement to challenge businessleaders to rethink why their organizations exist,and to acknowledge their roles in theinterdependent global marketplace.

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I interview business leaders, celebrities and authors.

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In this interview, he talks about how consciouscapitalism can help rebuild corporate reputations,how companies can give back to the communitywhile still making a profit, the key pillars forconscious capitalism, and more.

Over the past few years, corporate Americahas gotten a bad reputation. How couldconscious capitalism help rebuild thatreputation?

Free enterprise capitalism has been the mostpowerful creative system of social cooperation andhuman progress ever conceived, but its perceptionand its role in society have been distorted.Operating under the conscious capitalism modelwill show that businesses are the true valuecreators that can push all of humanity upward forcontinuous improvement. Businesses around theglobe need to steer capitalism away from today’sgrowing trend of cronyism, by embracingconscious capitalism.

My co-author Raj Sisodia and I describe this as away of thinking about business to ensure that it isgrounded in a higher purpose to enhance itspositive impact on the world. When reinvented inthis way, capitalism is an extraordinarily powerfulsystem of value creation mutually benefiting allstakeholders.

Research shows that Millennials want towork for a company that gives back to thecommunity, not just make a profit. Howcan companies do both?

I’m very encouraged by millennials and their driveto make the world a better place. Businesses cando both by practicing conscious capitalism, alwaysbeing grounded in its “credo”: that businessinherently good because it creates value, it isethical because it is based on voluntary exchange,it is noble because it can elevate our existence,and it is heroic because it lifts people out ofpoverty and creates prosperity. We hope our bookchallenges the notion that stakeholders inbusiness are inherently opposed to one another.That is not the case. When businesses operatewith higher purpose beyond profits and createvalue for all stakeholders, tradeoffs are largelyeliminated, performance is elevated and the entiresystem flourishes. Everyone wins. Remember,business is not a zero-sum game.

What are your four key pillars forconscious capitalism?

Higher purpose, stakeholder integration,conscious leadership, and conscious culture and


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management. The four are interconnected andmutually reinforcing. The tenets are foundational;they are not tactics or strategies. They representthe essential elements of an integrated businessphilosophy that must be understood holistically tobe effectively manifested. Higher purpose andcore values are central to a conscious business andall the other tenets connect back to thesefoundational ideas.

What happens if you neglect one pillar?

Focusing on the four tenents and making surethat all stakeholders of the business are winning iskey. If one tenent or one stakeholder is forgottenabout or is neglected, then the system will sufferlong term and the business will not operate to itshighest potential.

Can you give some examples, includingyour experience at Whole Foods, ofcompanies that have embraced consciouscapitalism and what they’ve done?

There are thousands of smaller companiesoperating this way. The more well-knowncompanies Raj and I find practice consciouscapitalism include Southwest Airlines, REI,Google, Nordstrom, Patagonia, The ContainerStore, POSCO in South Korea, as they createwin-wins for customers, employees, suppliers,communities and the environment, resulting inexceptional customer experiences, less turnover,lower overhead costs, higher profits, andsustained growth. It’s important to note thatconscious capitalism is not to be confused withcorporate social responsibility (CSR). Consciouscapitalism puts higher purpose and creating valuefor the community stakeholder at the core of everybusiness decision rather than being added on lateras a program to thwart criticism or help manage abusiness’ reputation.

What is your top career advice for youngprofessionals entering the business worldright now?

I tell students and young professionals all the timeto follow their hearts, do what they truly love, andif its business, run it by being grounded in ethicalconsciousness.

Dan Schawbel is the Founder of MillennialBranding, a Gen Y research and consulting firm.He recently made the Forbes Magazine 30 Under30 list and his second book called PromoteYourself: The New Art of Getting Ahead is dueout in the Fall of 2013 by St. Martin’s Press. He isoffering an online course called “Build Your


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