As we grow increasingly aware of the slew of major challenges facing global society, there is a growing conversation around the role that business can and should play in driving positive change.
In a recent GIBS Flash Forum led by Rabbi Gideon Pogrund, director of the GIBS Ethics and Governance Think Tank, GIBS spoke to Dr Leile Fourie, CEO of the JSE, and the esteemed Professor Rebecca Henderson, McArthur Professor at Harvard University and author of Reimagining Capitalism In A World On Fire.
This latest work from Professor Henderson is immensely relevant, both globally and locally, and offers sharp insights and invaluable wisdom for guiding businesses along the path of positive change. The book unpacks three major challenges facing society today:
- Environmental degradation
- Economic inequality
- Institutional collapse
Henderson explains that the first seeds of this work were born from her growing concerns about climate change, which led her to create a course for Harvard Business School which focused on reimagining capitalism and examining the role of business in tackling environmental challenges. Furthermore, Henderson began to encounter more and more energy companies who were grappling with the need to transition from an oil-and-coal economy to one of renewable energy. Following discussions with the course attendees, Henderson expanded the course scope to include issues of social and economic inequality.
Henderson’s expertise in the capabilities and responsibilities of effective business provides some fascinating insights into how we, as business leaders and participants, can adapt our operations to contribute to the creation of an equal, environmentally sustainable business world. She starts off by explaining that, when it comes to tackling the major challenges facing society, business simply cannot solve these massive problems alone. And, furthermore, these problems cannot be solved without business. Henderson explains that while there are many things that business can and should do to address these big problems, real, sustainable change cannot be achieved without a healthy partnership with a democratically accountable, capable government. Additionally, business desperately needs strong support from civil society, as well as a strong political and social movement to drive the vision of inclusive capitalism.
Business at its best, explains Henderson, generates (a) jobs, and (b) innovation. Both are needed at a huge scale for transformation. She goes on to say that she is in support of a programme that generates jobs through the private sector, and she believes that what is needed is the appropriate stimulation and support of competing firms in order to create jobs and address issues such as the Great Transition. While this is no easy task, Henderson believes that private firms with the right kinds of incentives and regulations are best positioned to lead the charge.
There is a strong belief that business needs to ‘stay in its lane’ and stay away from attempting to influence social change. Henderson, on the other hands, asks how organisations are supposed to continue with business as usual as the surrounding society becomes less and less capable of buying goods and services or providing effective employees? It is incredibly difficult to break even and make payroll while simultaneously driving change, but adaptation to our brave new world is a non-negotiable.
Henderson explains that we need to rethink what it means to be a business, so that we can get to the stage where we are prospering financially in a way that contributes to the long-term health and security of our society. We have a great battle ahead of us, but Henderson remains positive, and offers hope that success in this mission is imminently possible.
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