Conscious Capitalism: Doing Well by Doing Good
Today is the first ever celebration of Entrepreneurship at the U.N. In 2015 the United Nations general Assembly created 17 sustainable development goals. These goals are focused on health and well-being and include items such as solving poverty, hunger, clean water, clean air, electricity, education and equality. The solutions will require the time and innovation of the private sector in addition to governments.
Entrepreneurs and the business community have always driven innovation, and today is no different. Whether it is Henry Ford inventing the automobile, or Gordon Moore scaling semi-conductors at Intel. Whether it is Jobs and Wozniak at Apple making technology universally accessible, or Page and Brin at Google organizing the world’s information. Entrepreneurs are leaders who have created the greatest non-governmental organizations.
GoDigital has long been an innovator.
- We predicted the paradigm shift from physical goods to digital goods before there was the iPod, iPhone, or streaming – hence our name.
- We were the first company to monetize YouTube at a time when it was not even a thought to most media companies. Now, almost 20 years later, we have over 25 billion streams a month on the platform, one of the largest in the industry.
- GoDigital was the first to create a cloud based digital media supply chain orchestration platform for premium content. Now, that technology is integral to the largest movie and television studios’ distribution operations.
- GoDigital was among the first to recognize that music rights in the streaming era are a 100-year annuity and that Latin music consumers were at the nexus of increasing high speed wireless access, smartphone penetration, and banking participation rates. Now, Bad Bunny is the most streamed artist in the world.
Entrepreneurs and the business community have not, however, always focused on the long term. Many organizations have focused on short term profits over generational sustainability. I had the opportunity to see Henry Kissinger last October at 99 years old. He said great leaders think in long time horizons. I’m saying great entrepreneurs create innovative companies that stand for the long arc of time.
At GoDigital we talk about playing the infinite game. In contrast to a finite game, where the goal is to be the first to a set number of points or be ahead when the time runs out, the infinite game’s only goal is continuity of play. When we play the infinite game, we are living and working in a compound interest environment.
A good example of this is Warren Buffet and Charlie Munger, the founders of Berkshire Hathaway. 90% of their organization’s scale and impact has accrued since they were 65 years old. The second 30 years was 10x the first 30 years. Munger is famous for saying “show me the incentive and I’ll show you the outcome”. If 10x isn’t an incentive, I don’t know what is.
And so, in light of Secretary General Antonio Guttierez’ recent revelations that our progress against the Sustainable Development Goals is in jeopardy, now is the time for us to double down on innovation and long-term thinking.
For far too long, sustainability has been a plus factor in business. For many companies, it has been about “What can we do to help the world” as a social good, separate, and apart from their business. At best, corporations have woven sustainability into their business as a social impact investment, recognizing we all rise with the tide. But I’m here today to declare that sustainability and positive impact are not merely meant to be woven into a business’s purpose – they are the purpose of business.
We call this Conscious Capitalism. A term popularized by John Mackey and Raj Sisodi
Consciousness, in its simplest form, is awareness of internal and external existence. In context, conscious capitalism is awareness of not only what an organization is doing but most importantly why.
The four tenants of conscious capitalism are:
- A Higher Purpose
- A Stakeholder Orientation
- Conscious Leadership, and
- Conscious Culture
Let’s explore each one:
- A Higher Purpose. Knowing and understanding why an organization exists. Profit is a means to achieving purpose.
- Stakeholder Orientation: Towards not only investors, but also employees, suppliers, vendors, customers, and the communities we exist in.
- Conscious Leadership. Human organizations are created and guided by leaders. Conscious leaders embrace a higher purpose for business by focusing on creating value for, and harmonizing interest with, their entire stakeholder ecosystem. It is a belief that the game is not zero sum. That we can and will expand the pie and create win-win-win’s all around.
- Conscious Culture. All companies have a culture but not all companies intentionally develop their culture. Conscious organizations have a culture that aligns with their values and purpose, and they understand that stakeholders make decisions based on how they feel.
We believe that conscious, sustainable business practices drive positive business results well in excess of focusing only on economic outcomes. We believe a conscious approach is necessary to meet the U.N.’s Sustainable Development Goals. Here is how:
- Execution always comes down to people. When there is congruence between organizational purpose and individual purpose that’s when the magic happens. I have learned from working with neuroscientists from Stanford and Harvard and psychologists from Camp Pendleton that the emotional cortex in the brain has activity before humans take any action, even motor control. This means that we as humans are biologically wired to make decisions based on how we feel. Therefore, the operative function to achieve action, in service of purpose, over the long arc of time, is continually curating the feeling among our stakeholder ecosystems. The way we feel is the way we impact the world.
- When our executives and employees feel happy and congruent with an organization’s purpose, they are likely to stay longer and be more productive,
- When our customers experience joy from our products and services, they are more likely to engage as well as evangelize us in their community.
- This is why we like to own music rights. Nothing creates emotion faster than music.
- This is why we focus on building community in our networks,
- This is why we focus on health and wellness in our consumer products.
- Every single one of our brands and businesses is focused on inspiring happiness, not as a social impact goal, but as their primary business purpose. Because inspiring happiness, including through health and wellbeing is what we do as a company.
In conclusion, governments alone are not likely to be the solution. Business must step up. It is with pride that we at GoDigital focus on happiness as a purpose; to create infinite energy, play the infinite game, and deliver the inspired and innovative solutions required to meet the U.N. Sustainable Development Goals. We stand here to ask businesses around the world to join with us in doing so.
Learn more about Jason Peterson, Chairman of GoDigital Media Group and A2IM Advisory Board Member