Over the course of interviewing over 200 CEOs, I’ve found that many of them, whether consciously or unconsciously, are espousing the principles of conscious capitalism. So, this topic has become an ongoing theme on CEO Exclusive. For those who are not familiar with this trend, you can read an overview here: Conscious Capitalism Credo.
In recent conversations, I’ve noticed some people are thinking of conscious capitalism in a binary way–either you are a conscious capitalist, or you’re not. I’m not sure if this idea is accurate or helpful. To my mind, there are multiple ways that any company can express and embody these values. Moreover, a given business model (like selling a retail product) may lend itself to a different expression than another (like an accounting or a consulting firm).
Rather than a binary notion, I prefer to think that there are different archetypes, or different profiles, of companies that are espousing and *doing* conscious capitalism. Everybody has a way to participate or explore this way of doing business. This is something that is very important to me. In this week’s CEO Exclusive article, I discuss five archetypes of Conscious Capitalism, in the hope that you’ll find the right one for you.
Serving the Scorned
Serving a disadvantaged population that other companies overlook is one way I’ve seen conscious capitalism implemented.
In the case of Gas South, they created a new profit center and underwriting guidelines in order to provide natural gas to customers whose credit had dropped after the Great Recession.
Basically, they wanted to make sure these people had heat during the winter. But, here’s what makes them one of my favorite examples: it’s become an important and profitable service line for the company. They’ve improved their bottom line through helping people.
Creating Opportunity for the Downtrodden
Some companies practice conscious capitalism by actually giving jobs and creating opportunities for people who wouldn’t otherwise be employable, or who cannot create those opportunities for themselves. You can think of convicts, for example. From CEO Exclusive, Corners Outreach is a great case study of this archetype.
The original mission of Corners Outreach was to improve educational test scores in elementary schools in one of the most diverse counties in the United States. But, what they found was that a part of the reason why kids were not being able to reach their academic goals was because of lack of income and economic deprivation in the family. To solve this more systemic issue, Corners Outreach created businesses, like a landscaping business, like a construction business, for the purpose of providing jobs for these communities.
They have been able to uplift the entire system, because now, families have more disposable income. Parents can spend more time with their kids and help them with homework–which was the original objective, in starting Corners Outreach.
Re-deploying profit is one way of implementing conscious principles that is accessible to most every company. Corporate social responsibility and corporate philanthropy fall into this profile; however, thought leaders in this movement are quick to point out that “you can’t buy your way into conscious capitalism”. Undoubtedly, building culture and purpose-driven leadership do require investment of time and resources, so some companies embrace these ideals through taking a relatively *disproportionate* share of their economic surplus into these efforts. I expect that we will soon have metrics to help us better quantify what this means.
The most straightforward examples are companies that have a triple bottom line, meaning 100% of the profits from a for-profit company go into a separate non-profit. On the show, we’ve had Good Measure Meals. They’re all over gyms, all over Atlanta providing healthy, pre-prepared meals, that help you stay on your food plan. Then, their profits go to Open Hand Atlanta that feeds other needy people.
You are Your Higher Purpose
Some companies have a higher purpose that’s transcendent and very transparent. Great examples are hospitals, schools, or nursing homes, of which we’ve had many on the show. The higher purpose of a hospital is very obvious: to care for people, to make them well. Presumably, it’s who they are, and the higher purpose drives everything. Or, we certainly hope it does.
AgriSource Data, who I interviewed earlier this year, is a more subtle case study. They are a tech company whose higher purpose is to feed the world. How are they doing it? Through predictive analytics that resolves issues in the supply chain, from farmers all the way to supermarket shelves. This idea of “being the purpose” is a really powerful archetype for how to exemplify and embody conscious capitalism in business operations.
Invested in Ethos
While some companies have a business that screams “higher purpose”, others express conscious capitalism through ethos. You walk into their office, or you interact with the people, and you feel it. Culture is the leading tip of how the principles manifest in their operations. And, it actually takes intentionality; it doesn’t happen on its own. It may seem effortless when you walk into The Container Store, but if you talk to Kip Tindell, you’ll hear the level of effort that goes into making sure that that conscious ethos pervades everything that they do.
From CEO Exclusive, we have Kabbage as a case study. In speaking with their leadership, they don’t have titles for anyone at the company. Talk about non-hierarchical…This policy creates a sense of unity and flatness, in how they relate to each other and the ethos of a unified and intentional culture — aside from all of the other efforts they may be undertaking. Beyond the actual doing of the service events, beyond the investment of the money in pro bono projects, beyond having a stated higher purpose that pervades everything that the company does, this idea of investing in the ethos, the environment, and the emotional climate of the company is its own archetype.
An important tenet in conscious capitalism is that the higher purpose, the conscious culture, the conscious leadership, the stakeholder engagement are deeply woven into the DNA of the company. If that’s true, then it will show up in where the company spends its time, money, and focus. So, whatever that looks like for you, I hope that these examples will help you think through how you can either deepen, change, or codify this way of thinking even more deeply into the way that you run your business. Building institutional capacity in this regard is far more than a label or a membership. It’s a hero’s journey. Good luck!