Conscious Capitalism is a relatively new concept of doing business by leading with empathy, not authority. Sadly, too many businesses are led by fear and stress where bosses lead with fear and inflict stress on employees to get stuff done. Businesses that practice Conscious Capitalism are run with love and care (not fear and stress.)
Another way to view Conscious Capitalism is to think of it as Servant Leadership meets Mindfulness meets Environmentalism. It’s about doing business under the golden rule of treating your stakeholders (customers, employees, investors, communities, suppliers, and environment) like you’d want to be treated. It’s about using business to be a force for good in the world.
Raj Sisodia, a Babson marketing professor, has been tracking this business trend for the past 20 years. His studies reveal companies that follow Conscious Capitalism vastly outperform the market, citing a 1025% return over the past 10 years, compared to only 122% for companies listed in the S&P 500.
Whole Foods Market and The Container Store have been the torchbearers for the Conscious Capitalism movement and it is starting to truly gain momentum. Patagonia, New Belgium Brewery, Etsy, Ben & Jerry’s and Which Wich are a few other companies actively following Conscious Capitalism business practices.
However, despite reading a lot about Conscious Capitalism and spending a good part of my working career at companies that instinctively follow this approach, I’ve not been able to learn how businesses know they are “doing good by being good.”
Earlier thus year I attended the 2015 Conscious Capitalism Conference and learned exactly how a business knows they are doing good by being good. They become a certified B Corporation.
In order to become a certified B Corporation, a business must operate under certain standards of accountability and transparency with employees, vendors, local community and global community.
For example, as it relates to employees, a B Corporation business should offer lower-level workers the same benefits given to executives. The business should also be structured to openly share basic financial information with all employees and help cover costs for professional development of workers.
A certified B Corporation should also have a process in place to select vendors and suppliers up and down the supply chain that are committed to practicing “doing good by being good” business values.
Locally, a B Corporation should have an established partnership with a community charity and be committed to banking with either an independent bank or a credit union.
With regards to the global community, a B Corporation business should conduct an annual environmental audit of energy, water and waste efficiency and publicly share the results of the environmental audit.
Think your business is game to measuring its consciousness? If so, start by taking this short assessment tool (reg. req’d). It will take you less than 20-minutes to complete but the results of the quick audit will help you to understand if your business is on the path to “doing good by being good.”