I wasn't surprised when the World Economic Forum (WEF) posed the following question on Twitter:
@Davos: "How can we make capitalism more moral?"
After all, WEF itself has become "more moral" over time. The annual WEF gathering in Davos was historically about bringing business and political leaders together to gauge the state of the global economy and generate ideas to drive economic growth, thereby "improving" the state of the world. Over the past few years, WEF has tackled increasingly broad notions of business' role in society, including how business can operate more responsibly. In this regard, recent summit themes have ranged from "Shared Norms for a New Reality" (acknowledging that the 21st century demands new normative behaviors, that which we should do) to "The Great Transformation" (allowing for the new models we seek for today's economic and governance realities).
This year, WEF focused on "Resilient Dynamism" with sessions on "the Moral Economy" and "the Values Context." Both resiliency and dynamism are qualities enabled by vibrant and virtuous individual or organizational character, and so it is only natural that amid the conversations at Davos this year, an earnest debate emerged about the morality of capitalism itself.
As the CEO of a company whose mission is to "inspire principled performance," my bread-and-butter is to consider this very question - and so I had a few immediate, 140-characters-or-less reactions to @Davos:
"Start by not implying it's immoral but rather [in practice] amoral. That's more inclusive"
"Scaling 'sustainable' not 'situational' values to be 'too sustainable to fail'"
"Reading Wealth of Nations informed by the fact that Adam Smith was a Moral Philosopher"
While these proved good Twitter conversation-starters, the plane ride home from Switzerland provided an opportunity for me to think more deeply about the nature of this @Davos question. Ultimately, here's my suggestion: turn to the experts. But this time, the "experts" are not the likely suspects from prestigious business schools or consulting firms. Instead, to succeed in this new world, leaders should take a page, and some guidance, from some of our world's greatest moral philosophers. Why?
I've written before that the most practical tool we have to understand and address the scale of our challenges -- and to survive and thrive individually, organizationally and nationally -- can be found in moral philosophy. We live in a world that has rapidly gone from connected to interconnected to interdependent. In government, business, and society, we are now rising and falling together. One banker at his desk can lose $2 billion and affect global markets. One vegetable vendor can catalyze a revolution toward freedom throughout the Middle East.
The most famous line from The Godfather -- "It's not personal, it's only business" -- no longer qualifies as sound management advice. That's because we can no longer sustain separate, amoral spheres for our professional and personal lives. Everything is now personal as the world is now not just interdependent, it is morally interdependent. So much so that I consider moral philosophy to be the "killer application" of the 21st century.
Austrian-British philosopher Ludwig Wittgenstein understood its power, when in 1953 he wrote, "What is your aim in philosophy? To show the fly the way out of the fly-bottle." Today, we, metaphorically speaking, as flies who find ourselves in an ever shrinking bottle, are in an even greater need of leadership and direction on how to navigate the interdependent world.
I believe both can reliably come from moral philosophy. Moral philosophers examine areas that modern-day domain experts too often ignore: human values, core beliefs and character. Ancient leaders historically turned to moral philosophers for education, guidance, and to frame strategic challenges. For example, Aristotle served as Alexander the Great's tutor and trusted mentor at the request of Alexander's father, Philip. The philosopher imparted to his pupil the Aristotelian ideals of Greek civilization, and had great influence over the ruler's worldview.
How did Aristotle and others like him do it? By applying their intellectual might to the deepest, broadest questions of life -- why we exist, how society should organize itself, how institutions should relate to society, and the purpose of human endeavor, to name just a few. From climate to infrastructure to public safety to consumption habits to education, we gain clarity when we can view our challenges through a lens of moral philosophy. In this regard, here are 10 pointers from some of the thinkers who help us better understand the morality in our capitalist pursuits:
1. "The moral imagination diminishes with distance." -David Hume
Pointer: We are no longer distant, and therefore we need to reawaken our moral imaginations. In this interdependent world, everyone's values and behavior now matter more than we thought and in ways we never imagined because our actions affect more people than ever, in ways they never have before.
2. "Make the best use of what is in your power, and take the rest as it happens." -Epictetus
Pointer: Epictetus' words resonate today because as power continues to shift to individuals, leadership itself must shift with it. Leadership is no longer about formal authority that commands and controls and exerts power over people, but rather about moral authority that connects and collaborates and generates power through people. Think about what we're asking of our people. Today, we want our employees to: go beyond merely serving customers to create unique, delightful, experiences; honorably represent their company and nurture its brand, not only when they are on the job, but whenever they publicly express themselves in tweets, blog posts, emails, or any other interaction; and be creative with fewer resources and resilient in the face of unimaginable uncertainty. These are big asks! These contributions will not come as the result of motivating employees to shift their behavior with throwaway bonuses and threats of punishment; instead, leaders must ask their people to elevate their behavior -- a response that must be inspired through shared values and a purpose-inspired mission.
3. "We can learn to be whole by saying what we mean and doing what we say" -Martin Buber
Pointer: Authenticity and consistency have fast become our most valuable currency. Principled behavior breeds consistency -- however inconvenient it might be at the time. Authenticity is experienced in meaningful connections with others. Successful leaders demonstrate principled behavior and manifest authenticity by how they interact with others -- by being transparent, open, and direct with those around them; trusting them with the truth; and by putting the organization and its mission first above any perceived self-interest by taking the long-term over the short-term view.
4. "I suppose leadership at one time meant muscles; but today it means getting along with people." -Mohandas (Mahatma) Gandhi
Pointer: In a morally interdependent world, we do not sink or swim alone. This dynamic demands new capabilities of our leaders: to build coalitions and mutually supportive relationships; to foster an ecosystem of colleagues, partners, customers and even former competitors; and to eschew zero-sum competition in favor the true ideal of competition, derived from competere, to strive together. These skills really boil down to the ability to relate to others in a way that's based in mutual trust. After all, in a connected world, those who make the most meaningful connections win.
5. "The word of man is the most durable of all material." -Arthur Schopenhauer
Pointer: Our word has always mattered because it is durable, but now it matters more than ever because it is indelible. As a second-time father of a four-month-old baby girl, I'm reminded that information now resembles a toddler: it goes everywhere, gets into everything, and cannot be controlled. Our digital reputation precedes us and remains in the cloud after we leave. We can no longer manage our reputations, we can only earn them one interaction, one behavior at a time.
6. "Character is fate." -Heraclitus
Pointer: The qualities that will allow us to survive and thrive -- such as resilience, empathy, and curiosity -- come from character. In this era of behavior, the source of advantage has shifted to character. And with our newfound interconnectedness, as we all can easily see so deeply into organizations--into how things really work there -- the organizations themselves must strengthen their character. For both individuals and organizations, character determines how far we will go: our fate. Therefore, we can no longer just scale our products and services as we seek to become "too big to fail." We've got to scale our values so that we're too valuable to fail. To ensure that our organizations' character, or culture, consistently reflects our shared values, we need to put more humanity at the center, so that people are inspired to contribute fully their character and creativity. We also need to hire for character, not just for talent and skill, so that more humans can manifest the desired culture through leadership, business practices, and individual behaviors that create healthy interdependencies in this interdependent world.
7. "Excellence is not a single act, but a habit." -Aristotle
Pointer: The athletes we respect are the ones who practice rigorously and endlessly, so that they can make the shot under pressure, when it counts. Now, we need to become great moral athletes. The pressures have never been greater to be pragmatic, situational and expedient. Making a habit of acting according to our values is vital, and we do that through repetition -- by going to the moral gym day after day after day, so we will have the strength to be principled and thus consistent, however inconvenient, unpopular, or risky our actions might be.
8. "There is a difference between that which you have a right to do and that which is right to do." -Potter Stewart
Pointer: Although he was not considered a philosopher, Supreme Court Justice Potter Stewart was certainly philosophically inclined. His distinction gives a practical touchstone for moving from rules-based management to values-based leadership. After all, rules govern based on past experience - values are based on future aspirations. Rules also speak to boundaries and floors but create inadvertent ceilings. We can't, for example, legislate "the sky's the limit." Only a worthy purpose and values can inspire us to reach for the sky. Thinking only in terms of what rules allow (what we can or can't do) does not map to our interdependent world, in which we ought to think about what we should or shouldn't do.
9. "May you live your life as if the maxim of your actions were to become universal law." -Immanuel Kant
Pointer: As the world keeps shrinking and fusing, institutions are becoming increasingly global. We must of course keep celebrating the diversity of human expression, while endeavoring to base our actions on universal maxims so we can function as a global society. In today's world, any inconsistency can be broadcast or used in ways we did not expect. What we say and do in China can and will be heard, felt and experienced in India. We should be consistent in our behavior and in how we treat people regardless of context, because others in unexpected places may be watching -- and even be using our actions as a guide for their own behavior.
10. "A journey of a thousand miles begins with a single step." -Confucius
Pointer: These philosophers' insights present a difficult challenge: they require deep and enduring change. The world is messy and complex, yet our leaders continue to structure and manage institutions as if they can be kept separate, neat and tidy. What our leaders need now is to enlist us in a journey, embarking on a curvilinear path that eschews linear planning and gives room to explore new initiatives. To journey successfully, we must embrace this ethic of journeying not just in our personal lives, but in every human endeavor - including business. In order to set our feet on the ground and move forward on the up and down journey ahead, we must meaningfully connect and collaborate with others, so we can reach great heights together. As Confucius reminds us, every journey we'll ever take begins with one foot in front of the other. Those of us who can commit to a long-term journey, finding new ways to innovate in 'how' we do what we do along the way, will be the ones who thrive, not just survive, in the 21st century.
As we journey, it's helpful to remember why we journey in the first place, as an old story about two men doing masonry work illustrates. When asked by a bystander what he is doing, the first one says, "Laying bricks." The second replies, "Building a cathedral."
Moral philosophy reminds us every day that we need to be in the business of building cathedrals, not laying bricks. Philosophers are particularly good at understanding and grappling with paradox, such as the "paradox of hedonism" -- the philosophical idea that if you pursue happiness directly it eludes you. But if you passionately pursue a higher, more meaningful purpose, you can achieve happiness.
I have learned from my work that there is a corollary to the paradox of hedonism. I call it the paradox of success. Here's the paradox: you can't achieve success by pursuing it directly. Real, sustainable value can be achieved only when you pursue something greater than yourself that makes a difference in the lives of others. The word I use for this is significance.
The paradox of success can appropriately be applied to capitalism itself. Ultimately then, how do we make capitalism "more moral?" By launching our organizations on journeys of significance. As a byproduct, we should achieve human and economic progress. In the 21st century, it truly is practical to be principled.
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