Conscious Capitalism

Conscious Capitalism is a philosophy stating that businesses should serve all principal stakeholders, including the environment, customers and employees. It does not neglect the basic purpose of any business i.e. profit-seeking but encourages the assimilation of all common interests into the company's business plan. – In fact, while it emphases the need to pursue profits; conscious capitalism strives to do so in ways that sincerely consider the interests of all principal stakeholders. The philosophy recognizes that some stakeholders, namely the environment, cannot speak for themselves but are still necessary considerations when making business decisions. 

Conscious Capitalism credo builds on the core foundations of capitalism i.e. free market, voluntary exchange, entrepreneurship, competition, and the rule of law. However, it makes a step more: it adds elements like trust, compassion, collaboration, and value creation.

The concept was developed and popularized by the co-founder and CEO of Whole Foods, John Mackey together with the marketing professor Raj Sisodia. They believe that at the very heart of conscious capitalism is a “way of thinking about capitalism and business that better reflects where we are in the human journey, the state of our world today, and the innate potential of business to make a positive impact on the world”.

Conscious Capitalism stems from four guiding principles:

  1. HIGHER PURPOSE – i.e. focusing on a purpose beyond pure profits, and in doing so, inspiring and engaging stakeholders
  2. STAKEHOLDER ORIENTATION - Businesses have multiple stakeholders, including customers, employees, suppliers, investors, and others. While some companies only care to maximize their shareholders’ (i.e. owners) interests; a conscious company will focus on the whole business ecosystem.
  3. CONSCIOUS LEADERSHIP – conscious leaders emphasize a "we" rather than a "me" mentality to drive the business and create cooperation
  4. CONSCIOUS CULTURE – Business culture reflects the set of principles, rules and norms which guide people’s behavior within a given firm. Having a conscious culture means to foster a spirit of collaboration, trust, transparency and morality among all stakeholders.
A growing number of businesses have adopted the principles of Conscious Capitalism, including Whole Foods Market, Starbucks, and Trader Joe's. moreover, data show that more and more consumers are paying attention to companies’ approach: for example, according to Nielsen's "Global Survey on Corporate Social Responsibility," 43% of consumers would spend more on products and services that support honorable causes.