The three consciousness levels of responsible businesses
LEAD-IN’s “New Economy” Center of Expertise
Laurent Ledoux
20/01/15
Capitalism is today at the crossroads.
Society requests more and more businesses to align their purpose with humanity and the environment.
Corporate Social Responsibility is not enough for that, if it remains at the periphery of business, a marketing tool.
Businesses are asked to become “conscious” of what they do, of what their impact is for all their stakeholders.
LEAD-IN wants to contribute to the emergence of “conscious” companies and related “new economy” in Belgium.
To do so, LEAD-IN’s “New Economy” Center of Expertise is inspired by the works of authors such as Isaac Getz(Freedom Inc), Frederic Laloux (Reinventing organizations), Gary Hamel (The Mix), DebraMeyerson (Tempered radicals), DavidCourpasson Jean-ClaudeThoenig (Quand les cadres se rebellent),… and managers such as Jean-François Zobrist (Favi), John Mackey (Whole Foods), Michel Hervé (Le pouvoir au-delà du pouvoir),…
LEAD-IN’s Board member, Laurent Ledoux, has synthesized the core ideas of these authors and managers in what he calls the three consciousness levels of responsible businesses: Purpose, nature and human dynamics. It is a simple framework to analyze the advances made by businesses along the path of “consciousness”. While the three levels are interrelated, distinguishing them allows taking into account the fact that businesses engaged along that path will do so in different ways, with different accents.
Let us briefly describe on the following pages these three levels.
- Human dynamicsconsciousness
In Freedom Inc., Isaac Getz presents the results of a survey on employee engagement. It shows that overall only 27% of employees are engaged, 59% only moves upon request, and 14% are actively disengaged, which means that they actively work to “sabotage” the company for which they work for. This is the result of very bad people management, of companies not understanding what turns people into engaged employees. Various authors and managers have their personal formulas but they fundamentally converge. We like in particular the simplicity of Getz’s three principles to “free” an organization (free from useless controls, demotivating hierarchies, parasites,…):
Intrinsic equality (create a culture in which each employee is respected intrinsically as an equal):everybody wants to take initiatives
Personal growth (create a culture in which each employee can grow, not only professionally but also as a person):everybody is ableto take initiatives
Self-autonomy (create a culture in which each employee can be more autonomous, self-direct): everybody has the libertyto take initiatives
There are many ways to promote these three principles. Anon-exhaustive list includes: “Whyway” (participation, open communication,…), 360° feedback, wage gap reduction, bonus sharing, collective intelligence, suppression of time card control, teleworking, attention to craftsmanship,...
- Nature consciousness
Ecological issues are becoming more pressing and more and more companies are taking them into account. But conscious companies go beyond reducing by a few percent their ecological footprint. They are radically inspired by nature and adopt one or more of the following approaches:
Biomimicry: don’t reinvent the wheel, redesign products or reorganize your business drawing inspiration from nature (animals, plants,…) which has innovated continuously for billions of years.
Cradle-to-Cradle: a particular case of biomimicry, adopt a zero-waste approach to production (nature does not produce waste, it recycles everything) and develop radically new business models accordingly, such as Ray Anderson’s Interface or Desso in Europe, which have completely changed the production techniques of carpets and do not sell them anymore but lease them.
Product Service System: don’t sell products but services, just like Interface or Desso, and change your business model accordingly. So Michelin does not sell tyres anymore but “kilometers” and by so doing dramatically reduces the use of materials used to produce the tires necessary to allow for a given number of kilometers.
Circular economy: ensure that the waste of a company becomes the input of another; put them in touch like in Geneva. Similarly, at the level of products, make sure that the energy produced by your oven is reused to cool your fridge.
Sharing economy: animals do not own anything. Do we really need to own a car, a lawn-mowner,… let’s share them and reduce total production accordingly.
Now, some companies also study nature but not to mimic it and to protect it but rather to negate it and, in some ways, to work against it. For example, today Google is the company that employs the biggest numbers of bio-engineers. Its trans-humanistic goal is “to kill death”, an ideal which runs against the most elementary law of nature: individuals need to die to help regenerate the genetic pool of the specie. Needless to say, the increasing financial powerof trans-humanists poses a serious threat to democracy, human rights and social equality.
Overall, nature consciousness is about living and making business in a greater harmony with the laws of nature, not against them.
- Purpose consciousness
Responsible companies are conscious that the purpose of a business cannot be reduced to profit or shareholder value maximization. These are constraints, not end goals. Besides, shareholders are only the rightful owners of the shares, not of the enterprise. So conscious businesses adopt a series of different governance practices in order to make sure they systematically put the Friedmanian ideology upon its head: the purpose of a business is “to optimize its contribution to society at large under the constraint of an adequate return to its shareholders”, and not “to maximize shareholder’s value under the constraint of not infringing the law”. To do so they adopt some of the following practices:
-To adopt a legally binding societal purpose to its statutes (see Daniel Hurstel)
-To adopt principles akin to the merchant marine’s contributionto joint damages (everybody pays or benefits from failures or success; see Blanche Segrestin)
-To set-up a board of “critical friends” or to invite them into the board (see Antoine Frerot)
-To engage in Territorial ISO 26000(see Hervé Defalvard)
In the coming months, LEAD-IN’s “New Economy” Center of Expertise will try to uncover businesses in Belgium that have adopted one or more of these practices and will try to disseminate their experiences and best practices.