raj sisodia - conscious capitalism at barrett ctt 2012 conference south africa
DESCRIPTION
Raj Sisodia, Author of "Firms of Endearment" keynote speech. Sponsored by Nedbank.TRANSCRIPT
CONSCIOUS CAPITALISM ACTUALIZING BUSINESS AND HUMAN POTENTIAL
Raj Sisodia Professor of Marketing, Bentley University Chairman, Conscious Capitalism Institute
WHAT CAPITALISM HAS ENABLED IN A VERY SHORT TIME
A Tale of Two Short Centuries
$467
$453 $566
$596
$615 $667
$873
$1,262
$2,113
$6,055
2010: $7,278
GDP per Capita, 2000 $
Industrial Revolution Begins
Source: www.VisualizingEconomics.com; Angus Maddison, University of Groningen; www.prb.org; www.worldbank.org
0 2000 500 1000 1500 Year
The Economic Success of Capitalism is Unprecedented in World History
Real per capita income has increased: •16x in developed countries •35x in Japan •3x in Africa •100x in the U.S. (adjusting for quality
and affordability)
Capitalism is Ending Poverty on Earth
World Population Living on Less Than $1/Day (in ‘03$ )
0%
50%
100%
1800 1950 1980 2003
Source: World Bank (constant 2003 dollars)
The percentage of people living on less than $1 per day has dropped from 85% in 1820 to about 17% today.
If current trends continue, poverty will be virtually eliminated in the next 50 years.
good because it creates value ethical because it based on voluntary exchange noble because it can elevate our existence heroic because it lifts people out of poverty Business is
Yet, Mistrust of Business is Pervasive
Only 2 percent of investors believe that CEOs are “very trustworthy”; 72 percent
believe that wrongdoing is commonplace at companies.
2011: 88% of Americans believe that big companies have too much influence on
government, up from 83 percent in 2004.
2011: 79% believe business is too concerned about making a profit and not enough about responsibilities to workers, consumers, and the environment.
Americans’ confidence in big business has declined steadily, from about 34% in 1975 to a historic low of 16% in 2009, rebounding to 19% in 2011.
“The whole growth model we created over
the last 50 years is simply unsustainable
economically and ecologically… Both Mother Nature and
Father Greed have hit the wall at once.”
March 7, 2009
After just one century of modern living…
75% of forests are gone
30% of arable land is gone
Large mammals are down 90%
Large fish are down 95%
Half of all species alive today are likely to disappear in 50 years
Toxic burden on humans is rising
Oil supply is decreasing just as demand is rapidly rising
After 1980, we started using more than Nature can renew; now 1.3 times
If everyone lived as Americans, would need FIVE earths…
…as Europeans, THREE earths
0%
5%
10%
15%
20%
25%
30%
35%
40%
Such cynicism and distrust have huge societal costs
Confidence in Big Business % of Americans with a "Great Deal" or "Quite a Lot" of Confidence in Big Business
WHY has this happened?
THE WORLD has changed
PEOPLE have evolved
BUSINESSES have not kept up
We are changing…
1989 THE WORLD CHANGES
In 1989, for the first time in U.S. history, the majority of adults were over 40
Who is this man?
What did he do to change the world? Tim Berners-Lee
He invented the World Wide Web in 1989
Peter Senge
Live in harmony with nature
Fully mindful and awake
Understand all the consequences of our actions
Reject violence
Commitment to the truth
A finer sense of right and wrong
“The dogmas of the quiet
past are inadequate to
the stormy present.”
To flourish in the future, companies will have be aligned with the new realities of our lives and embody a
more conscious way of being
What will it take for companies to flourish in the future?
“A conscious business fosters peace and happiness in the individual, respect and solidarity in the community, and mission
accomplishment in the organization.” Fred Kofman, Conscious Business
MEETINGS END WITH APPRECIATIONS
ANIMAL COMPASSION STANDARDS
MINISCULE MARKETING SPENDING
1800%
MEMORIAL DAY FLOOD
A HIGHER PURPOSE
93%
19:1
DECLARATION OF INTERDEPENDENCE
FUTURE SEARCH
The Tenets of Conscious Capitalism
STAKEHOLDER INTEGRATION
CONSCIOUS LEADERSHIP
CONSCIOUS CULTURE
CONSCIOUS MANAGEMENT
HIGHER PURPOSE &
CORE VALUES
Can you build a business on love?
Can you build a business on love?
“Heart attacks are highest on
Monday morning.”
An Epidemic of Apathy
The Shame of “Management”
TODAY!
LOVE
JOY AUTHENTICITY
CARING
COMPASSION
SOULFUL
10.5-to-1 performance
“FoE”
(1646%)
Stock Returns over a 15 Year Period (’96-’11)
S&P 500
(157%)
15 Year 10 Year 5 Year 3 Year
Cumulative Annualized Cumulative Annualized Cumulative Annualized Cumulative Annualized
FoE Return 1646.1% 21% 254.4% 13.5% 56.4% 9.4% 77.4% 21.1%
GTG Return 177.5% 7% 14.0% 1.3% -35.6% -8.4% -23.2% -8.4%
S&P 500 Return 157% 6.5% 30.7% 2.7% 15.6% 2.9% 10.3% 3.3%
FoE Compared to Good to Great
What is a “Great” Business?
Maximizes “total value created” Enhances the overall health and well being of society
Brings joy, fulfillment, and a sense of meaning to all its stakeholders
Enriches the world
Businesses Create, and Destroy, Many Kinds of Wealth
intellectual financial social emotional
spiritual cultural physical natural
The Tenets of Conscious Capitalism
STAKEHOLDER INTEGRATION
CONSCIOUS LEADERSHIP
CONSCIOUS CULTURE
CONSCIOUS MANAGEMENT
HIGHER PURPOSE &
CORE VALUES
Meaning comes from:
Doing work that matters
Selfless love Finding meaning
in suffering
Happiness ensues from living a life of meaning and
purpose
Profit ensues from
working toward a higher purpose,
building businesses on love, and
growing from adversity
Compensated engagement is going down
Uncompensated effort is going up – volunteer work is nourishing people in a
way that paid isn’t
The
Purp
ose
Inst
itute
Great Purposes are HEALING
H
E
A
L
I
N
G
Heroic
Evolutionary
Aligning
Loving
Inspiring
Natural
Generous
Healing: To restore to health or soundness; to cure; to restore to spiritual wholeness; to become whole and sound. In a world with too much suffering and ill-health, healing is divine work.
The difference you're trying to make in the world
Drives everything you do Matters to all stakeholders Is your reason for being that goes beyond
making money YET… typically results in making more
money than you thought possible
Roy Spence
The Power of Purpose
Southwest Airlines Give people the freedom to fly
Google Organize the world’s information and
make it easily accessible and useful
REI Reconnect people with nature
The Tenets of Conscious Capitalism
STAKEHOLDER INTEGRATION
CONSCIOUS LEADERSHIP
CONSCIOUS CULTURE
CONSCIOUS MANAGEMENT
HIGHER PURPOSE &
CORE VALUES
56
Whole Foods Market Stakeholder Interdependence Model
I INVESTORS
C CUSTOMERS
E EMPLOYEES
S SOCIETY
E ENVIRONMENT PARTNERS
P
Business, Society and the Planet
Traditional View
The PLANET
BUSINESS SOCIETY
Conscious View
The PLANET
SOCIETY
BUSINESS
Conscious Capitalism ≠ CSR
• Shareholder-centric • Independent of purpose • Often grafted on to
traditional business model • Easy to meet as a charitable
gesture • Performance implications
unclear • Independent of type of
leadership
• Stakeholder-oriented • Incorporates higher purpose • Societal orientation is at the
core of business model • Requires genuine
transformation • Significantly outperforms
traditional business model • Requires conscious
leadership
The Tenets of Conscious Capitalism
STAKEHOLDER INTEGRATION
CONSCIOUS LEADERSHIP
CONSCIOUS CULTURE
CONSCIOUS MANAGEMENT
HIGHER PURPOSE &
CORE VALUES
“We must be the change we want to see in the world.”
Conscious Businesses Need Conscious Leaders
Purpose-driven Authentic
Caring Systems thinkers and “systems feelers”
Emotionally intelligent Spiritually evolved
Strong character and integrity Trustee oriented
The Tenets of Conscious Capitalism
STAKEHOLDER INTEGRATION
CONSCIOUS LEADERSHIP
CONSCIOUS CULTURE
CONSCIOUS MANAGEMENT
HIGHER PURPOSE &
CORE VALUES
Culture eats
strategy for lunch! breakfast!
T
A
C
T
I
L
E
Cultures of Conscious Businesses
Trust
Accountability
Caring
Transparency
Integrity
Loyalty
Egalitarian
Humans are born to care.
Our institutions magnify or
depress the human capacity
to care. Jane Dutton
University of Michigan
Conscious Management
Beyond Theory Y
• Self-Organizing Self-Motivating Self-Managing
• Decentralization
• Empowerment
• Teamwork
• Collaboration
Higher sales intensity & growth
Lower gross margins, higher net margins
Lower marketing, product return costs
Lower legal and administrative costs
Greater employee retention & engagement
Cons
ciou
s Cap
italis
m w
orks
The biggest difference between ordinary and conscious businesses?
Creative, Caring Human Energy!
71
We are all in the same boat.
“I would not give a fig for the simplicity on this side of complexity but I would give my life for the simplicity on the other side of complexity.”
Oliver Wendell Holmes, Jr. US Supreme Court Justice
Humanity is one spirit
Natural resources are
finite
Our inner resources
are infinite
Ron Pompei
The Opportunity
Those of us alive today have the opportunity to lead the most meaningful lives ever lived
Our challenges are great, but so is our consciousness and our ability to change things
We have all the tools we need; we just need to unleash human ingenuity on our challenges in a holistic, conscious, caring way
Lynne Twist
Essential Reading for Conscious Capitalists
www.ConsciousCapitalism.org
[email protected] Please email me if you are interested in being involved with
setting up a South Africa Conscious Capitalism Chapter
Can successful profitable organizations really be built on “love”?
Is a “Conscious” agenda realistic in tough, recessionary times?
How can we embed conscious living and conscious business principles in young people early on?
Some Questions