In Western society, capitalism often earns a dog-eat-dog reputation. We’ve been led to believe that we can either make money or do good. But it is possible to do both. Your business can benefit your employees, customers, and the world at large if you learn to balance your ideals and pursuit of profit.
The core idea behind conscious capitalism is to marry business goals with a higher purpose to make the world a better place. It’s important to understand that capitalism doesn’t equate to greed. Our society needs businesses to survive — businesses produce necessary goods and services and provide employment opportunities.
If you’re a CEO, an owner-operator, or a board member, conscious capitalism may be just the approach you need. Conscious capitalism takes these economic benefits a step further by recognizing the link between building a world-class enterprise and serving others.
The business benefits of conscious capitalism
Conscious capitalism offers concrete benefits for businesses beyond feeling good — such companies have been shown to outperform the Standard & Poors 500 and Russell 3000 indices.
That could be karma, but it’s probably good branding. Consumers like buying from socially responsible companies, so businesses that value people, planet, and profit generate greater customer loyalty and more referrals.
Mission-focused companies are also more likely to attract and retain top employees. According to a recent report, about two-thirds of consumers prefer to work for socially responsible companies. When your employees feel good about what they’re doing, they’ll enjoy coming to work and be more productive.
From a leadership perspective, conscious capitalism simplifies decision-making because it’s very easy to see which options will lead the company astray from its goals and values. Aligning your business with a higher purpose also spawns innovation and makes work more enjoyable.
How to build conscious capitalism into your business
Every leader wants to build a company that does good in the world and makes money. There’s nothing more gratifying than hearing, “You work for Company X? That’s such a great company!”
But there’s more to conscious capitalism than getting customers to spend. Here’s what you need to do to align your business with a higher purpose:
- Shift your mindset. Love and compassion shouldn’t be dirty words in your company. These concepts have the power to generate customer loyalty, client referrals and long-term employee satisfaction. If you care about people, they’ll care about you and about your company. We forget sometimes that business itself is formed by and consists of human beings, not products and services.
- Reorient products and services. Ideally, your products or services should improve people’s lives. It’s circular — if people are making products and services that better our lives, we want to do business with them. If you already have a product line, explore ways it can be repositioned or refined to make a difference or be more socially responsible.
- Establish new metrics. In addition to measuring things like revenue and ROI, you should introduce criteria to your management team that can make an impact on the community and your employees. How is the product improving our lives and the lives of those around us? Set goals, and have an open dialogue with your team about how those goals will impact your decisions moving forward.
Conscious capitalism starts by understanding the link between serving others and building a strong business of conscious people. Wanting to “do well by doing good” doesn’t make you overly idealistic, and maximizing profits doesn’t make you cold-hearted. Capitalism and social good don’t have to be opposing forces. If you care for your customers and your employees, profits will follow.
Paresh Shah is an experienced entrepreneur, executive, yogi, life coach, and dad to four kids. He’s the founder and CEO of Glimpulse, the human-expression company, which creates products to challenge, inspire, and equip people to be happier, healthier, and more giving through authentic self-expression.
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