As you would have noticed from glancing over this blog, I have been a little encapsulated by the concept of shared value in recent times. I have come to believe it has the potential to be key to the foundations of future sustainable commerce. Where businesses generate value for stakeholders beyond simply ‘maximising shareholder wealth’. And in the meantime also strengthening the economic bottom line of organisations. Everyone wins.
Umair Haque has been at the forefront of this movement conceptualising the future of the global economy. A future that exists not only 10 or 20 years from now, but perhaps in 100 years. As the world lives with scarcity, high population and the imperative for long-term sustainability. In a follow-up to his seminal work, The New Capitalist Manifesto, Haque explores a path to better future prosperity. Taking inspiration from what the ancient Greeks termed the ’Common Wealth’ of society. According to one of the most celebrated thinkers of human history, Aristotle, society should seek to attain the ‘good life’. Rich, meaningful and full of great achievement…
[The good life] wasn’t an easy, comfortable, materially rich life, but one that was authentically, meaningfully rich; rich with relationships, ideas, emotion, health and vigor, recognition and contribution, passion and fulfillment, and great accomplishment and enduring achievement, exactly what ‘business’, ‘output’ and ‘product’ seem so achingly deficient at producing. That concept of prosperity is very different to the one we know today.
What so many of us seek today is consumption. To consume the most and the best. So then, when you think about business today in these terms, it is clear that the majority of activity is meaningless rabble. In fact, much of it is pointlessly depleting mineral resources, polluting the environment, creating waste, and even poisoning or making humans less healthy. For example, think about much of the crappy plastic products from China, fast food, and other consumer items. According to Haque, instead of busi-ness (being busy with activity for the sake of it) we should build better-ness (business that better or benefit society).
There is a clear and simple way we can move from this self-defeating situation. A way that business can break free from a downward spiral of perpetual cost-cutting, supplier screwing, and negative externality shifting. The author quite rightly points to these current characteristics of most organisations as an obselete model, one that is crucially missing long-term sustainability.
The future is balanced sustainability. Working to bring forth human potential, not destroying it or deliberately constraining it. Haque points to virtue as the fundamental starting points for organisations to begin turning things around.
Arete – the habits of betterness - demand a struggle with the self, not just a battle with rivals, competitors, or enemies. The goal isn’t mastering and defeating rivals, but living up to your potential. The real antagonist, the party with whom there is a fundamental overarching conflict, is the organisation itself because yesterday’s set of fundamental building blocks is standing in the way of tomorrow’s wealth creation.
To make virtue central to the DNA of a business, there are four habits they should adopt…
Ambition; also known as a vision statement, why the organisation exists in terms of higher-order returns and who’s wealth it wishes to enhance to include notions of Common Wealth.
Intention; often referred to as a mission statement, not only how an organisation will do business but how it will honour their human potential.
Constraints; competitive constraints support and protect a generative advantage, a surplus in real marginal wealth. They are actions we will never take to ensure others can fulfill our intention.
Imperatives; a set of universal, unconditional obligations to be obeyed without fail always. Imperatives are what demand work that’s timeless and ageless, not just transient and disposable.
If this emergent vein of strategic thinking on global commerce interests you, I can recommend the full mini-publication available through Harvard Business Review store. There is no doubt in my mind this is the road all business will have to take in the very near future. Whether through government regulation, consumer demand, increasing costs, or following the insightful leaders that begin the trickle. Or perhaps all of the above.