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The Next Economy
From the Archbishop of Canterbury to Captain Kirk and Donald Trump

Can capitalism be ethical? This was the question asked by Rowan Williams, the former Archbishop of Canterbury, in a recent lecture in Cambridge (part of Murray Edwards College’s Capitalism on the Edge series). He argued that while capitalism may unarguably deliver ethically desirable outcomes – such as innovations in health and less onerous work – it cannot be ethical per se if, at its core, it is about the ownership of property and its exchange for profit. Such a system, he argued, can’t generate systematic, sustainable answers to questions of social good and therefore be ethical. For if capitalism only causes social good as a byproduct, then over time it will marginalise non-profit-making activities. What price the environment, what price human rights, what price craftsmanship?

Religious leaders have long questioned capitalism and its centricity in people’s lives. The Christian gospels, for example, have Jesus engaging on issues from tax collecting to money lending. But it does seem to be coming to a head at the moment, focusing on the connected questions of sustainability and purpose in business. Pope Francis’s 2015 encyclical (‘Laudato Si’) was the first devoted to environmentalism and was seen as a moral charter for sustainable development. The Church of England uses its substantial investment weight to‘support initiatives to help reduce the threat and impact of climate change’ and ‘engage with companies about their response to climate change.’ And one of the Four Noble Truths of Buddhism – that all suffering is caused by craving; that getting what you want does not guarantee happiness; and that rather than constantly struggling to get what you want, try to modify your wanting – finds a natural kinship with the sustainability movement.

At SB’16 Bangkok in October, keynote speaker Venerable Dr Anil Sakya, the deputy rector for foreign affairs at Mahamakut Buddhist University in Thailand, talked to what businesses might learn from the Thai model of ‘Sufficiency’ thinking. At the previous year’s conference, he argued for a broader definition of capitalism, and that Adam Smith’s thinking should be viewed more holistically. For him, Smith’s description of capitalism as driven by selfishness (‘It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.’) could not be viewed in isolation from his descriptions of how it is driven also by selflessness (‘How selfish so ever man may be supposed, there are evidently some principles in his nature which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it,’ and that ‘No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable.’)

These can all be seen as part of the tension that has always existed in human society between doing right for oneself and doing right for the group. Individualism and collectivism compete in all of us and in all human societies. The canvas on which this tension plays out has become larger as our definition of community expands to include not only our neighbours but peoples in far corners of the world whose lives are now visible to us; and as our understanding increases of climate change and the limits of our shared planet, so that we are asked to sacrifice some of our individual freedoms and desires for the sake of our common environment.

This tension that religions seek to address with their tenets around ‘love thy neighbour’ and ‘karma’ is the same tension that the sustainability movement addresses: Both examine the balance between individual freedom and social responsibility. So it is not surprising that religion and sustainability are starting to overlap. This tension is even coming to the fore in popular culture. Star Trek Beyond this year pitted Captain Kirk and the crew of the Enterprise against Idris Elba’s character, Krall. Krall, as the champion of individualism, tells Kirk: “Unity is not your strength. It is a weakness.” Kirk, the face of the Federation, replies, “I think you’re underestimating humanity.”

In this environment (the discussion around individual freedom and collective responsibility, rather than outer space), business is rightly questioning whether it has the right balance between selfish and social. Businesses across the world are asking whether profit should be their only purpose. This was clear in the involvement of businesses in setting the Sustainable Development Goals (SDGs) in 2015, and the fact that 70 percent are planning to embed the SDGs into their businesses within five years.

In fact, profit as the sole purpose of business is a relatively recent phenomenon. The Italian economist Stefano Zamagni has written extensively on the ‘civil economy’ of city states in Renaissance Italy, where the driver of economic growth was not rights and contracts but social bonds and civic ties. And the ‘Quaker-capitalists’ of 19th-century Britain – the Levers, Cadburys, Boots, Salts and others – built enduring businesses on the belief that the purpose of business was not just to make a profit (although profitable they were) but to show an active and practical concern for their communities and employees. In exploring a broader purpose than profit, today’s businesses are in many cases simply returning to the core principles of previous generations.

Perhaps this can point one way out of the divisive side effects of capitalism. Global trade has brought unquestionable improvements to human existence, but when it is carried out through a capitalist approach that has profit as its only purpose, and those improvements are the side effects rather than the intent, the direction of travel makes too many people feel left out. And the people who feel left behind by capitalism and globalisation soon enough scream in anger at the global elite and become susceptible to populism or even radicalisation. 2016 showed us this all too clearly with Brexit and Donald Trump.

Capitalism isn’t ethical if it is focused solely on profit as a zero sum game with winners and losers. Eventually the losers pick up a brick or at least vote for destabilising change. Businesses who hold to a broader purpose – one that pursues profit, yes, but balances that with environmental and social responsibilities and all the other things that we as a society need and value – can offer all of us, as members of that society, the opportunity to make choices about what we value, by supporting businesses that behave in a manner and with a purpose we support. Armed with the information provided by the digital age, we are increasingly empowered to make those choices.

Religions, in all their different forms, have pointed to that balance between self and society. The sustainability movement today, in a more interconnected world than the founders of those religions lived in, makes a similar case for us to recognise and act on our shared responsibilities as well as our individual desires. Business with purpose may be one of our better opportunities for rebalancing the scales between selfish gene and social animal.

This post first appeared on the Salt blog on November 11, 2016.