In a recent GreenBiz article, Rick Ridgeway, Patagonia’s head of environmental affairs and creator of the “Responsible Economy” campaign, asked a fundamental question: “If [economic] growth is the elephant in the room, and if over time it’s unsustainable, and if it is the underpinning of our capitalist system … what would capitalism or an economy look like without growth or even with retraction?”
While Ridgeway’s question is multifaceted, one thing is clear: An economy where growth is not the driver would have a model of business success and leadership that is radically different from what we have today.
No longer would continuous growth in economic activity or material throughput -- the underpinning of GDP and business performance -- be the goal of business leadership.
What could replace throughput models of corporate success and activity-centered leadership as the underpinnings of a capitalist system where growth is not the mantra?
First, let's consider how corporate success would be defined in this new system. The rapidly proliferating work on national well-being (as a replacement for GDP) would be extended to corporations. Corporate success would be thought of in terms of the overall well-being of stakeholders. This would mirror healthcare trends where the focus is increasingly on the holistic and not just the physical well-being of individuals. As a result, the health of nations, corporations and individuals would be aligned.
No longer would continuous material growth throughout a company’s lifetime be expected or rewarded, just as physical growth throughout a lifetime is unhealthy for human beings.
If well-being replaces material throughput as the measure of corporate success, then being will replace activity (“busy-ness”) as the core of business leadership. The highest kind of leadership is to realize that we are all existentially interconnected. The wisdom traditions and philosophical schools have called the source of this connection as "Being," which is the shared essence of our existence. It is why we call ourselves human beings, not human doings. As a result, Being is relevant for everyone, regardless of whether they are religious, spiritual, secular, atheistic or otherwise.
I define "being-centered" leadership as the effort to lead from a place of seeking to realize being in business.
The outlines of this new model of business leadership can be derived from current examples. In my new business book, Two Birds in a Tree, I describe more than 20 CEOs who have shown small or large touches of being-centered leadership. They include such sustainable business icons as Paul Polman of Unilever, Yvon Chouinard of Patagonia and Ray Anderson of Interface, as well as several less-familiar faces.
In being-centered leadership, considerations such as the higher purpose of business and who you are as a leader will guide the material ends of the company. Importantly, business success becomes redefined as the long-term well-being of all corporate stakeholders.
To get a glimpse of such a business, consider Natura Cosmeticos, the famous Brazil-based beauty, personal care and household products firm. In 2012, it was ranked second among the most sustainable companies in the world. Its current CEO, Alessandro Carlucci, has deepened the company’s already tremendous commitment to nature and local communities, even as it delivers financial gain to its stakeholders.
Natura’s commitment extends especially to protecting the Amazon forest from where it derives its ingredients, as well as the tribes and indigenous population that live there.
Natura believes deeply in enhancing the well-being of its stakeholders. As Carlucci says, “Here at Natura we believe that well-being should be felt and experienced by everybody. ... We believe that the value and longevity of a company is measured by its ability to promote the sustainable development of society.
“What motivates me the most is to see that I’m part of a group of people that wants to do business and, at the same time, contribute to the well-being of people, society and the planet.”
The company’s slogan in Portuguese, printed in large white letters on its São Paulo headquarters’ glass walls, is bem estar bem (“well-being" or "being well").
In a Harvard Business Review cover story on the 100 best CEOs in the world in 2012, Carlucci was in the rarefied 5 percent of CEOs who delivered great financial performance while also excelling in social and environmental dimensions. According to the story, Carlucci is “a leader among CEOs who believe that alleviating poverty and inequality and protecting the environment are intimately tied to their business agendas.”
To me, the answer to Ridgeway’s question is clear: In the new capitalist system, being-centered leadership will be prevalent and firms such as Unilever, Patagonia, Interface and Natura will comprise the 95 percent, and not the rarefied 5 percent.
Top image of Natura Cosmeticos products, and image outside company headquarters, by Eve Andersson