Building on my previous post, it’s remarkable the number of column inches being devoted to the potential of the COVID-19 crisis to bring about long-term, transformational change. There’s a growing sense that, not only will we not be returning to normal anytime soon, but maybe we won’t return to the old normal ever.
Among the issues being thrown into sharp relief:
- Work from home rules are giving everyone a sense of the daily challenges faced by many working mums (and dads), which will hopefully spark accelerated progress on gender equality specifically and flexible working more generally
- The precariousness of many people’s livelihoods is once again shining a light on executive pay, with CEOs earning plaudits for cutting all or some of their salaries to protect against having to furlough or lay off staff
- The importance of community is being highlighted like never before, hopefully causing the realization to finally dawn (on those it has hitherto escaped) that the health of business is inextricably linked to the health of the social and environmental systems in which it is embedded
The more I reflect on this (the last point especially), the more I wonder if my last post went far enough. The encouragement to think about ways of working that are worth hanging on to, once the crisis subsides, is a field of enquiry anchored in ‘what,’ when there are arguably much higher-order ‘how’ and ‘why’ questions at play here.
“What will be the new normal, post-coronavirus?” is perhaps the wrong question to be asking. A better one might be “How should the experience of coronavirus reshape what we value, and how we organize ourselves to deliver it?” – in other words, a question rooted in fundamental design values and operating principles.
The beauty of a question like this is that it can be applied at multiple levels – the systemic, the organizational and the individual. At the organizational level, it can help us to expand our mental model of ‘corporate responsibility’ – vital at a time when ‘responsibility’ no longer seems remotely adequate to capture the full breadth and depth of what’s at stake.
Indeed, as those smart folks at Volans observed in an email I received from them earlier this week, the irony is that ‘responsibility’ seems to be hitting the mainstream consciousness with a vengeance at precisely the moment when ‘responsibility-as-usual’ is no longer a sufficient response to the realities we face. As they argue (correctly, IMHO):
Change-as-usual strategies have tended to focus on Responsibility – or, in the financial world, risk. There’s nothing wrong with acting responsibly – in fact, in moments like these, we need responsible business leaders more than ever. But the focus on responsibility turns out to be only the base layer of systemic change.
What we now need is for business to embrace two additional Rs: Resilience, of course – a topic that has, rightly, if belatedly, shot to the top of every leadership team’s agenda in the last few weeks. And Regeneration – because, ultimately, no business can become truly sustainable or resilient unless it operates as part of a living system and contributes to the health of that wider system.
So, what might be the organizing principles of ‘regenerative capitalism’?
A good place to start, I’d suggest, is with the these eight, as put forward by John Fullerton, CEO of the Capital Institute, a few years ago. If these strike a chord, then you can find out more about them, and John’s research, in a more extensive white paper here.
In any event, the key point is surely that now is the ideal opportunity to use this crisis as the spur to ‘do’ capitalism differently – to reimagine what both business and government is for.
As for the former, I’d return to the British Academy’s definition of corporate purpose as ‘solving the problems of people and planet profitably, and not profiting from causing them’; also to the eternal wisdom of Charles Handy and these words from his seminal 2002 HBR article, What’s a business for?:
The purpose of a business is not to make a profit, full stop. It is to make a profit so that the business can do something more or better. That “something” becomes the real justification for the business. […] It is salutary to ask about any organization, “If it did not exist, would we invent it?” “Only if it could do something better or more useful than anyone else” would have to be the answer, and profit would be the means to that larger end.
As for the latter – as UCL economics professor, Mariana Mazzucato, argued in The Guardian a couple of weeks back – now is a perfect time for governments to seek to actively shape markets that deliver sustainable and inclusive growth, and to steer innovation toward solving the big social and environmental challenges of our time:
[It] is time to finally learn the hard lessons of the 2008 global financial crisis. As companies, from airlines to retail, come asking for bailouts and other types of assistance, it is important to resist simply handing out money. Conditions can be attached to make sure that bailouts are structured in ways that transform the sectors they’re saving, so that they become part of a new economy – one that is focused on the green new deal strategy of lowering carbon emissions while also investing in workers, and making sure they can adapt to new technologies.
[We] can use this moment to bring a stakeholder approach to the centre of capitalism. Let’s not let this crisis go to waste.
And with those last few words – wouldn’t you know it? – we arrive right back at an almost verbatim repeat of the final line of my previous post. (Spooky!)
LIVE LONG AND PROSPER 