THE BLOG

Modern Capitalism vs. Socialism

08/26/2014 06:38 pm ET | Updated Oct 25, 2014

There is a slogan out there of people, planet and profit. It is on this point that the global society is slowly reaching a boiling point where being exploited by the business community is unbearable. The great challenge we are facing is the fierce urgency of NOW. People are tied about solutions of tomorrow!

Well, we ask, should we blame the corporate world for making money legally, through a cause and effect model, where they offer goods and services and we're willingly pay, then why come back and complain to them for making big amounts of money, furthermore attack them for paying their senior executives huge packages? It is not fair for lazy-to-think-and-act individuals to mobilize support to attack the capitalistic system.

At the heart of this debate are Adam Smith and Karl Marx who are both grandfathers of capitalism and socialism respectively.

The problem comes when making profit, you create a social problem like air and water pollution, health problems from working in industrial and mining companies, then come back and act as if you are making the people a favor by addressing those problems for free.

However, we see a new breed of CEOs in the corporate sphere who are not only profit-driven, but are concerned by the social impact they have in countries they operate in, like Paul Polman from Unilever and Richard Branson of Virgin Group.

There is enough if we share, that's why philanthropy is appealing to the wealthy.

Nonprofit organizations are often met with less resistance from the society compared to corporate companies who make profit out of solving problems we face; it is true as the world has been changed by social movements. What companies do is to commercialize solving social problems which is becoming one of the most profitable business strategies.

There is this new concept of Return on Social Investment (ROSI) I saw a coal mining company Exarro use in their Corporate Social Responsibility initiatives which helps them to measure returns in monetary value for sustainability.

The link between capitalism and socialism should be partnerism, by employing both methods in taking this world forward. Even communist China also embraces the capitalistic system which helped them to rise as quickly as they did.

Socialism led to communism after appearance of Karl Marx, as it was adopted in Russia and China; however it was not successful as anticipated, so they went back to capitalism even when they still claim to be communists.

The capitalistic system is integral success of today's world besides it's few side effects from bad crooks within the system; therefore a greater proportion of capitalism and lesser proportion of socialism is necessary for a sustainable future. Shared value preached by Michael Porter professor of Harvard Business School will serve us good to balance economic and social values.