Enlightened Capitalism

Essays about how to harness people's natural desire to create wealth and improve their quality of life to solve global problems such as war and poverty.

Wednesday, March 15, 2006

The ultimate goal of socially conscious business

>I, for one, am very interested in the intersection of business and social improvement.<

This is an interesting statement, because on the face of it all business seems to be about social improvement. No one is forced to buy anything, in spite of the stories we tell. Since transactions are freely entered into, both buyer and seller must believe they are benefiting.

I guess there are two problems which socially conscious investing has arisen to address.

First, the free market allows people to repeatedly make choices which lead to financial ruin. For instance, spending too much on alcohol or gambling can lead to loss of your home and job. Kind of like a mountain road with no railings or lane markers.

We see the smashed cars below and think, we should make that road safer. Then we lobby and campaign to convince everyone to agree to put up railings. That's an uphill struggle in the case of products and services; freedom is such an important value to us.

Society has outlawed a few things like cocaine and asbestos, which arguably lead people to ruin. It has put some restrictions on tobacco, guns, sex, loan sharks, and gambling, presumably to protect individuals from their own free choices.

Socially conscious investing has this protection built into it, as part of the goal of the business. That is, a business which is designed to consistently and reliably improve its customers' (and employees', suppliers', owners', and neighbors') quality of life, and which succeeds at it, is socially conscious.

The other problem is that some things are really profitable which end up being bad for everyone, like strip mining, or tobacco growing, rhinoceros hunting, or feeding sheep brains to cattle. This is often an even more difficult struggle to restrict, because there is so much money coming out of the enterprise before anyone complains, that all the politicians are in debt to these bad boys, kind of like Chicago's court system under Al Capone.

Socially conscious business ought to leave the world at least as nice as we found it. Currently it is enough to simply do less damage than all the other companies providing the same product, as is the case with Seventh Generation disposable diapers, or organically grown vegetables that are shipped to us in diesel powered trucks.

What seems apparent in looking at this situation is that socially conscious businesses have arisen to fill a gap in government's stewardship of the common good. We are doing the government's job, because the government is being paid not to do it.

So the ultimate goal of socially conscious business has to be to transform the government. I never thought of it that way before.


  • At 11:49 am, Blogger Dale said…

    I'm just commenting here to let you know I recently had a couple questions on your earliest posts

  • At 7:50 pm, Blogger Philosophie said…

    A related blog on the poverty and social state of the union http://conscious-capitalism.blogspot.com/


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