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Conscious capitalism, by that name, is a relatively new concept. It's starting to get recognition and we possibly see a little more of it in India.
The broader subject has been discussed under a variety of names though, including Shared Value Capitalism and Capitalism 3.0 — and now we have Capitalism 4.0. Bill Gates discussed Creative Capitalism, about corporates and the power of the market helping the poor. People have been saying that capitalism is lacking in consciousness and the need of the hour is true stakeholder integration.
The truth is that a lot of people are asking these questions. All business recognises that the landscape is changing. The world has shifted from where it was 20 years ago, with evolving value systems and rising intelligence. Business has to adapt and every major company is moving on one or more of these directions of being more responsible.
Where we have seen it happen, it has to come from the top; it comes from the leadership, the CEO, and then trickles down to the board and the organisation. We are working with some companies in Korea and Brazil; and one each in India and the US, right now.
In India, we saw it happening with the State Bank of India under O.P. Bhat. Every employee was urged to rediscover the purpose that SBI had to serve. There was a lot of large-scale cultural transformation that he had initiated.
When transformation to conscious capitalism is initiated, one needs to think it through thoroughly. An implicit encouragement of another kind of behaviour, while speaking for a conscious approach from the top won't work. The worst thing you can have is double speak. Even if you have targets to meet, only integrity and commitment to the chosen direction of conscious capitalism should get you there. There needs to be clarity, commitment and constant communication from the top.
An understanding of the higher purpose of business with a win-win proposition for stakeholders, a certain leadership culture and values, and culture within the organisation, can, over time, result in superior organisational performance. A lot of large-scale cultural transformations are headed in this direction.
( Rajendra Sisodia is Professor of Marketing, Bentley College and Co-founder and Chairman, Conscious Capitalism Institute. As told to The New Manager)
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