Is Capitalism Dead… or just being re-invented?

Fast Company magazine in December 2019 proclaimed capitalism is dead. That’s like Vogue magazine saying style is dead, or Car and Driver magazine saying cars are dead! The bastion of business says that there are CEOs who are “leading the way toward a more equitable, humane, and democratic system that works for the many and not for the few”.

Have we finally figured out that the people who work for a company are more than two arms and two legs? Is the idea of shareholders who ask only for a higher return on investment taking a back seat to other values like human flourishing and the health of the community we live and work in?

Simon Sinek, organizational consultant and author of the best-selling book, Start With Why, says he has a bold new paradigm for capitalism. Banner ads pop up on our social media feed calling us to “Awaken your organization. Change our world”. New books abound with titles like The Healing Organization.

So, is capitalism dead or is it just reinventing itself? Can we save it from its own misconstrued vices since it began in the 17th century? Were business leaders in the Industrial Age missing something when they said they only wanted to hire two hands and two legs?

Guess what? Another world leader already proclaimed this paradigm shift long before capitalism was invented. He was an early adopter for cultural change. His talks were mostly in the marketplace and once he spoke outside on a hill, with no microphone and no PowerPoint. Turns out his father had published some books before he arrived on the scene and he inspired his followers to write a series of books after he died. Together the 66 books they authored became a collective best seller.

In his talk on the side of the hill, he said we should give to those in need without always being seen (interpreted: don’t keep all the money for yourself), and that we should be careful to not stockpile our treasures (a.k.a. profits). He said that we actually get blessed by God when we show mercy (maybe when we don’t fire the worker who came in late because their car broke down). He suggested in his talk that we work to achieve peace and help people cooperate instead of fight (meaning it’s of high value to help people work out their differences in our workplace, because it’s an important community where people are looking for meaning). He even said we should make the first move to put things right with our enemies.

He noted we should strive to do what’s right and to be honest (i.e. don’t fudge the results, the numbers or the rules just to increase sales). He told the listeners to be content with who they are and not want more (a better title might not matter). In the same speech, he summed things up by saying we should generally do for those who work FOR us, what we would want done TO us, if we were them. Maybe we might give team members a backpack filled with school supplies in August since some of our team members can only afford a pack of pencils even though they work two jobs to pay the rent. Or we might create a profit-sharing plan that gives more than a meager Christmas bonus.

One translation of this 2,000-year-old talk put it this way, “Ask yourself what you want people to do for YOU, then grab the initiative and do it for THEM”. The speaker? It was a leader named Jesus of Nazareth. When he was done, the Bible tells us that the crowd “burst into applause because they had never heard anything like it… this was the best teaching they had ever heard.”

Wow! Have your team members burst into applause at the end of your talks?! The ones listening to Jesus did so because Jesus was championing a counter-cultural series of premises that focused on others instead of ourselves.   

In his book, Serving Two Masters, Reflections on God and Profit, Bill Pollard, former CEO of the $9 Billion dollar ServiceMaster Company, asks two important questions. First, “What is the role of profit?” and secondly, “Why is it important to our success?”.

Mr. Pollard points out that Milton Friedman, an economist and 1976 Nobel Prize winner, once said, “There is one and only one social responsibility of business – to use its resources and engage in activities designed to increase profits”.  In Friedman’s view, every decision made for the organization would be to increase its profitability.  When faced with the decision of keeping jobs or sending them overseas, the one that returned the greatest profit would be the correct answer.  In Friedman’s view, money is the end game.

Bill Pollard sees things differently. He sees profit as a virtue. Pollard writes, “It is more than a scorecard for investors on Wall Street. It has a direct relationship to the truth and value of our promise to the customer and to the people of the firm.” 

He went on to write, “Profit as a virtue, is a tool for accomplishing end goals of honoring God and developing people.  Managing with care for the people producing the profit, we can recognize profit as a virtue of accountability, not a vice of self-aggrandizement.”

At ServiceMaster, they realized that the most important asset of the firm was not its money tucked away in the bank; rather, the most important asset actually walked out the door every night. It’s the people in your firm. For this reason, ServiceMaster saw that there was a fair distribution of the profits of the firm, and they provided multiple opportunities for stock ownership by employees.

Unlike Friedman, who saw profit as the end goal of a firm, Bill Pollard saw it as a temptation.  When profit becomes an end goal, one can risk the loss of the “soul of the firm”.

Jesus reminds us, “For what will it profit a man if he gains the whole world, and loses his own soul?” Mark 8:36 (NKJV).

Perhaps Bill said it best when he wrote, “As an end goal, profit and wealth can become addictive and self-consuming. They can become a person’s god, leading to the loss of ultimate purpose and meaning in life. When this happens in a firm, the management of people becomes a game of manipulation to accomplish a series of tasks for a profit, with the gain going to a few at the top while those who produce the results suffer an atrophy of the soul.  Profit is a means goal in God’s world, to be used and invested, not worshiped as an end in itself.” 

Is the old version of capitalism dead in your firm? If not, maybe you should kill it. Ask yourself if you are too focused on profits and shareholder value to the exclusion of people, the planet and your community. Hopefully in its newest form, you can reinvent capitalism into a more conscious, God honoring capitalism… and your people just might applaud.


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About the Author  

Greg Leith is the CEO of Convene. He was born in Canada and lived in all four corners of North America. His career spans over 35 years of senior leadership roles in corporate, non-profit and academic sectors. Recently, he served as Director of Strategic Alliances for 13 years at Biola University in California.