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At a time when 1% of the world’s population owns 90% of its wealth and when, even in the developed world, large parts of the population feel ‘left behind’ – as exemplified by the Brexit vote and the election of Donald Trump – it must be time to change the economic model. But how?
The answer isn’t philanthropy (the problem is too big), or taxation (which just depresses economic growth), nor can governments alone sort this out. The most powerful economic actors who have the potential to bring about change are companies and individuals as entrepreneurs.
Last month HEC Paris launched the Movement for Social Business Impact, an initiative that aims to help business and entrepreneurs build a more inclusive global economy, where businesses can maximize their social impact together with their economic performance.
This ambitious project does not propose some silver bullet solution, rather it aspires to help, through research and experimentation, in what Danone CEO, Emmanuel Faber, described as “Rewriting parts, or all, of the source code of the economy – is it for profit…or is it for social justice.”
Besides Faber, the other key note speaker at the launch and a co-chair of the project was Nobel Peace Prize winner Professor Muhammad Yunus, the founder of the revolutionary Grameen micro-finance bank. Yunus warns that we are sitting on a “ticking time-bomb”, and that even if we were somehow to reduce poverty to zero it would probably return unless we found a way to change the system.
Currently the system is structured to continually push wealth up into the hands of the few. So, the 1%-90% ratio is inexorably set to get worse. “This can’t continue”, says Yunus. It is this systemic instability that is causing the tensions we are seeing not just in poorer countries but also in the developed world leading to the rise of more extreme politics.
The impact for good that business can have on society is potentially huge. But, according to Yunus, we need to redesign business itself so as to bring the selfless parts our human make-up to business. People are motivated by money – money equals happiness. But making other people happy brings us “super-happiness”. To redesign business we need to combine these two happiness motivators.
Another point raised by Yunus, is that we don’t necessarily need to work for someone else. Taking a long historical perspective, we see that human economic endeavour wasn’t always linked to a job application. Rather than seeing ourselves as employees we should see ourselves as job creators and as entrepreneurs. This concept sits well with the findings of various surveys of the Millennial generation where a high percentage express a desire work outside of the traditional corporate business environment.
These surveys also depict a generation, now in the workforce, that is steered by strong values and wants businesses to focus more on people (employees, customers, and society)—and less on profits.
The Movement for Social Business Impact builds on the academic research and teaching by the HEC Paris Social Business/Enterprise and Poverty Chair, which is in turn supported the Action-Tank Social & Business. Since 2010, the Action-Tank has helped develop and implement innovative poverty alleviation projects, bringing together companies, NGOs, public and academic authorities.
The Movement for Social Business Impact will focus on four key activities:
Catalyzing world-class research on business social impact and social business by building on partnerships with the best international academic teams
Strengthening and broadening the teaching opportunities concentrating on social business impact, training a new generation of managers
Accelerating the deployment, and scaling up social business projects incubated in France
Providing institutional resources to develop international social business incubation models, which offer essential goods and services to the poorest populations
View video of the launch event and the keynote speeches (length 1.47 mins)
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