The “art and science” of business is constantly evolving. As companies grow, new business methods and best practices are put into action. It was once commonly thought that maximizing shareholder wealth was the most important philosophy, but some companies have moved on to consider the corporate social responsibility (CSR) movement. Now a growing new trend is taking place with the conscious capitalism school of thought.
Capitalism is defined by Merriam Webster dictionary as “an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market.”
In more than a century since the word capitalism was first used in 1877, the world of business has changed as has the meaning of capitalism.
In today’s business world, the concept of capitalism seems to be under constant attack. How many times in the past few years have you turned on the news only to hear tremendous anger directed at “Corporate America” (i.e., Wall Street, insurance companies, banks)?
In the past several years, economic instability has had any number of effects on the entire population, particularly with young adults. The difficulties they’ve faced getting a job or purchasing a home may be dampening their view of the free market. A recent Pew Research Center poll found that just 46 percent of people age 18-29 have positive views of capitalism, and 47 percent have negative views.
This poll further emphasizes that one of our greatest challenges is restoring the public’s understanding of business and capitalism as a way to create a higher quality of life for everyone. That’s a daunting challenge that business leaders, business educators, aspiring entrepreneurs, and business students must face. But redefining capitalism is also a challenge that many are willing to undertake.
I believe business schools must take the first step in redefining capitalism. Collectively, we can achieve this by instilling a heightened sense of personal and corporate responsibility in our students and in our business partners.