Social Capitalism, How are today’s companies exploiting it?
I grew up in a small village in India where few people lived happily and sustainably. We owned a small farm and produced our own food. But I always wanted to travel and learn how the world works. So, I moved to America to study master’s in Computer Science in California with interests in understanding how the modern world works. And believe it or not, I came to realize that Social Capitalism have tremendous effects on the planet earth and societies we live in. Social Capitalism is about using profits to do good for society and the environment. However, You may have heard the popular saying, “The road to hell is paved with good intentions.”
Introduction to Social Capitalism
Social Capitalism is a philosophy that advocates for the use of capital to solve social and environmental problems. It is also a system of doing business that seeks to balance the interests of all stakeholders, including customers, employees, investors, suppliers, and the community.
The history of the social capitalist movement can be traced back to the 1800s when a social entrepreneur named Andrew Carnegie was born. He was a Scottish-American industrialist who built one of the largest empires in U.S. history and became one of the wealthiest people in world history. However, it was not until recently that this concept became popular in business circles. This is because many companies are now looking for ways to make money while also solving social problems.
The Specifics of How the System Works
The specifics of how the system works is a question that has been asked for many years. In order to understand how social capitalism works, one must first understand the principles of it.
The principles of social capitalism are as follows:
- The economy should be regulated by a public body
- All citizens should have equal rights to food, healthcare and housing
- The market should be subordinated to society’s needs and not vice versa
- There should be a redistribution of wealth from those who have an abundance to those who do not.
Social capitalism is an economic system that is based on the principles of fairness, justice, and equality. The idea behind social capitalism is to enable social mobility and empower people as a whole. Social capitalism envisions a world where all people have access to sustainable jobs and resources so they can reach their full potential. In the below paragraph, you will realize none of these principals are followed in modern companies.
Social Capitalism in Modern Companies
There are a lot of companies that are using social capitalism, some of them are Tesla, Nike, Adidas, Patagonia, and Lush. There are two ways these companies use social capitalism: they either donate money to charities or use their profits to fund projects that help society and environment. The book “What’s Mine is Yours” by Rachel Botsman and Roo Rogers goes into detail about how companies can use social capitalisms to their advantage. They say that the three core tenets are:
-Building platforms for participation
-Creating shared value
-Connecting people with resources
The authors also say that there are six different types of social capitalism, which include: -Civic Capitalism (e.g. IBM) -Social Capitalism (e.g. Starbucks)
However, if we pay attention to these companies’ real agenda, it’s always about money. I have been in the corporate sector and know that only financial results matter. None of the Social Capitalist companies have any good metrics to showcase their social impact. These companies merely offer random stories about doing good in the society and don’t get me wrong, these stories are true and do have some effect. For example, at the time of writing this blog, WealthSimple (A financial Company) is running a campaign “Support Education for All“. If you open an account with them they would help modest-income families getting the educational grants from the government. For some families it might help but someone might ask does getting a degree from collage would grant success to them? Getting a collage degree might only make you a slave to the capitalist world. If WealthSimple is serious about education, invest in public schools infrastructure instead of offering free money.
Furthermore, a simple Google search will tell you that more than 689 million people live below the poverty line in our world and the number is constantly increasing. Sometime I question to myself, what those families will do with collage degrees? In our world, there are millions of people with bachelor’s degrees in their hands doing labor jobs to pay off their student loans. Additionally, the education system today is just about creating more slaves for corporates. We need to invest in changing how the education system work itself.
Coming from a farmer’s family, I know that living happily and sustainably is very easy if we can break this vicious circle of constant financial growth. Companies need to define metrics that will support the friendly future for human race as one. One example of these metrics can be Roti (Food), Kapda (Cloths), Makaan(Home). “Roti, Kapda, Makaan” was identified as fundamental right of a person when India got independence in 1947. However, because of money-hungry corporations, the government policies were exploited to make money instead of focusing on the real issue. I would like to challenge any organization to implement these simple metrics.
Dear Social Capitalists Don’t try to do any good to the Planet or People. Please just don’t take the person’s fundamental right of access to Food, Cloths and Shelter.