Sustainable capitalism

Shareholder value started to merge as a phrase in the 1980s and people like Professor Alfred Rappaport (Kellogg GSM) and Jack Welch (General Electric) used the phrase in conjunction with the idea of aligning executives and shareholders rewards. This concept has led to pushing the boundaries of ethical and moral business practices into tax evasion and short termism, going against previous corporate responsibilities such as Quaker rooted ideas of employee welfare. Such virtuous practices were voluntary and would give rise to later ideas of Ethical business and sustainability. The problem is you cannot define precisely these responsible ideas which in turn means you cannot regulate or mandate this type of virtuous behaviour. We also have difficulty regulating CEOs pay and although recent moves to disclose average rates, gender parity and ethnicity in pay rates are a welcome move in the direction of more openness, nevertheless the pay of CEOs is still regarded as some form of reward for effort which includes privilege. The issue of pay becomes a question of Trust because of the pressure of corporate short termism, executive reward and personal greed which leads to inappropriate behaviour. The current scrutiny of the behaviour of individuals and companies leads to a view that capitalism isn’t efficient irrespective of your economic ideology. The poor continue to be poor and the rich get richer. Technology is not the panacea that it was heralded to be, Tech Titans rule the roost, self-cement their technical superiority and promote the status quo, despite being advertised as ‘disruptive’ they still do not address the issue of inequality or enfranchisement of the poor. ‘Free markets’ do not exist because of social pressures on immigration, use and movement of labour, trade and tariff wars . There is still the dichotomy of thought when it comes to fixing capitalism either through more or less regulation. When we look at structures of Society and the role of business, the current legal, formal and informal contracts don’t appear to be a facilitator for fairness and equality. Maybe it is time we stopped producing what we think we want and only buy/consume what we actually need and be looking at advertising and marketing as informative rather than persuasive. There is an old school of thought that says customers are more important than shareholders, so maybe this idea could transform itself into sustainable purchasing. Keeping a weather eye on climate change, use and abuse of natural resources and care in communities are three ways in which capitalism can be improved. The basic laws of supply and demand require a more holistic and natural framework in which to operate. The Earth is a zero sum game as resources are finite. If Tech is to be of any use to capitalism then it cannot be beyond the wit and wisdom of Silicon Valley to report and narrate the effects of capitalism and individual business behaviour on the environment. GaiaTech needs to be invented that gives us this holistic view on individual and business performance and guide governments in producing legislation that is fit and proper and not open to abuse or ‘misinterpretation’ by measuring the long term societal and environmental effect of our behaviours. Tech should be an enabler to lengthen our moral attention spans. This can be further expanded to have more narrative reporting in published accounts that shows the impact the firm is having on society, so some form reporting metrics needs to be formulated , again it can’t be that difficult to find measures of waste, energy efficiency or environmental safeguarding that can be consistently applied. If society is serious about having a better form of capitalism then it needs to embrace shared values and eradicate some of the short term thinking. Public, private, governmental and third sector businesses must share a common purpose, which leads us into difficult territory of what exactly is a ‘force for good’ , philosophically we end up back in Ancient Greece about good citizenship because we are still talking about individual behaviour and the current business debate about leadership. If we can define ‘good’ then we are halfway there. Our Ancient Greek ancestors would have recognised this debate about capitalism and transacting business. One of them famously said if you want to be a good citizen then start acting like one. The future of capitalism is fundamentally about behaviour, if you want to run a company that is a ‘force for good’ then start being ‘good’