5 Ways to Change the (Business) WorldDec 20, 2022
If we harness the power of these domains through the lens of stakeholder capitalism, we can shift the trajectory of business — and the planet — for the better.
By Amanda Kathryn Hydro and Nathan Havey
The Institute for Corporate Transformation was founded to create what is needed to cultivate dignity of work for all. We believe that organizations can deliver a socially and environmentally responsible world if the business community can expand its definition of success accordingly. This expanded definition is captured in the six areas of the Stakeholder Score. The question facing the Institute for Corporate Transformation and our partners around the world in the 100 Months to Change Coalition, then, is how can we best leverage our limited time and capacity to make this kind of business the default mode of business on Earth?
There seem to be five mutually reinforcing domains that create what is ‘common knowledge’ in business. The five domains are:
- Professional Associations
- Business Schools
- Business Media
If these five domains began to operate from the expanded scorecard of stakeholder capitalism, the conditions would be set for the broader paradigm shift in business to occur. These five domains are a possible framework to focus the outreach and organizing efforts of 100 Months to Change Coalition members.
1. Professional Associations
Many business leaders are involved in professional associations to connect with fellow business leaders and stay abreast of important trends and industry best practices. These associations include everything from local and state chambers of commerce and local service clubs like Rotary and Kiwanis to large, national, industry-specific groups like the National Restaurant Association and function-specific groups like YPO and EO for CEOs, associations of corporate board members, and certifying bodies and associations for HR and accounting.
These groups are often hungry for quality content that their members will find valuable, and 100 Months to Change is certainly that. If the leaders of these professional associations become knowledgeable about and advocate for the expanded scorecard for success, then we can greatly expand our capacity for change. Inviting these leaders to events and building direct relationships with them will help us create mutually beneficial alliances to expand our influence and advance our mission.
2. Business Schools
Probably the single-greatest influence on the dominant business paradigm is the curriculum taught to MBA students in business schools. Currently, some professors are aggressively leading the way in teaching their students the concepts behind the expanded scorecard, but most schools confine these ideas in a single course on business ethics, if they are taught at all. Outreach to faculty and students at local business schools (no matter how big or prestigious) is another strategic opportunity for us. Inviting them to events or enlisting them to co-host events with us will likely pay great dividends as we continue to grow.
3. Business Media
Imagine what would happen if the expanded scorecard was consistently featured in the pages of the Wall Street Journal, the Financial Times, Fast Company, Inc, and Forbes, as well as on the airwaves of CNBC, NPR, and the countless podcasts on business and entrepreneurship. Individual 100 Months to Change Coalition members may not be able to affect programming at some of these larger outlets, but they can build relationships with their local business media and business beat journalists and columnists for major local papers. Members could even create a speaker corps of local business leaders, academics, and consultants to pen op-eds and be available for comment as reporters seek perspective on the business stories of the day.
Similarly, business books have a tremendous influence on business leaders. Promoting the books that are resonant with the expanded scorecard (to members, to media, and even on Amazon) and debating (respectfully) those that propagate the old paradigm is another important aspect of the business media domain in which members can engage.
Most businesses rely on consultants (at least occasionally) to help guide their decision-making. As such, consultants are another critical domain that shapes the paradigm of business. Active outreach to consultants, large and small, and across industries, is another major opportunity for 100 Months to Change members to move the needle. The goal is not to turn every consultant into a specialist in a resonant framework like conscious capitalism, benefit corporations or the Stakeholder Score. However, the more a marketing consultant, a leadership consultant, and a financial consultant can all see the world through the lens of the expanded scorecard, the more their advice will contribute to the broader paradigm shift we seek.
The people and institutions that provide capital to businesses are a critical domain. Networks of venture capitalists, leaders of state and local economic development efforts, executives from banks offering business loans, and analysts for the major capital markets are also integral relationships for 100 Months to Change members, ambassadors, and liaisons to build.
Imagine what would happen if a loan application included questions on stakeholder relationships, workplace culture, environmental regeneration, and dismantling discrimination? What if most analysts began incorporating those factors into their stock evaluations? What if economic developers expanded their view to see that not all ‘jobs’ are equal and not all economic ’growth’ contributes to prosperity?
If adopting the expanded scorecard would help business leaders access capital, and if ignoring it prevented that access, things would change in a hurry. As we all know, the research on the financial performance and resiliency of expanded scorecard companies suggests that such a filter for capital investments would be in the best interest of the providers of that capital. We should endeavor to help sources of capital develop tools to operationalize that understanding.
Like the six areas of the Stakeholder Score, these five domains are mutually reinforcing. As capital increasingly prefers stakeholder capitalism investments, the business schools will increasingly teach stakeholder capitalism. As greater results are achieved by consultants operating under the new paradigm, business media will promote their stories, causing professional associations to spread the paradigm shift more broadly, generating more opportunities for capital, case studies for business schools, stories for media — and so on.
Ultimately, if these five domains can be brought into alignment with the expanded scorecard of stakeholder capitalism, the paradigm shift we seek would become a foregone conclusion. Therefore, increasing this alignment locally and nationally is central to the theory of change of the 100 Months to Change Coalition.
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