Conscious Capitalism
Podcast #38 — Aired July 31, 2014

What if there was a better way to do business? This week on BetterWorldians Radio, we’ll talk about how Conscious Capitalism can build stronger businesses and create a better world for everyone. Our guest this week is Raj Sisodia, co-author of Conscious Capitalism: Liberating the Heroic Spirit of Business. Sisodia will discuss why he believes entrepreneurs are the “true heroes in a free-enterprise economy.” Tune in every week to hear new guests share how they are making the world a better place and to learn how you can become a BetterWorldian!

 

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Raj Sisodia
Co-Author, Conscious Capitalism Author, Firms of Endearment

Raj Sisodia is the Franklin Olin Distinguished Professor of Global Business and Whole Foods Market Research Scholar in Conscious Capitalism at Babson College. He is also Co-Founder and Co-Chairman of Conscious Capitalism Inc. He has a Ph. D. in Marketing from Columbia University. Raj is co-author of the New York Times and Wall Street Journal bestseller Conscious Capitalism: Liberating the Heroic Spirit of Business (Harvard Business Review Publishing, 2013). In 2003, he was cited as one of “50 Leading Marketing Thinkers” by the Chartered Institute of Marketing. He was named one of “Ten Outstanding Trailblazers of 2010” by Good Business International, and one of the “Top 100 Thought Leaders in Trustworthy Business Behavior” by Trust Across America for 2010 and 2011. Raj has published seven books and over 100 academic articles. His book Firms of Endearment: How World Class Companies Profit from Passion and Purpose was named one of the best business books of 2007 by Amazon.com.

Episode Transcript

Raymond Hansell
Joining us today is Raj Sisodia, the coauthor of Conscious Capitalism. Raj is the Franklin Olin Distinguished Professor of Global Business and Whole Foods Market Research Scholar in Conscious Capitalism at Babson College. He is also Cofounder and Cochairman of Conscious Capitalism Inc. He has a Ph. D. in Marketing from Columbia University. Raj is coauthor of the New York Times and Wall Street Journal bestseller Conscious Capitalism: Liberating the Heroic Spirit of Business. He was named one of Ten Outstanding Trailblazers of 2010 by Good Business International, and one of the Top 100 Thought Leaders in Trustworthy Business Behavior by Trust Across America for 2010 and 2011. Raj has published seven books and over 100 academic articles. His book Firms of Endearment: How World Class Companies Profit from Passion and Purpose was named one of the best business books of 2007 by Amazon.com.

Raj
Thank you, it is my pleasure to be with you.

Raymond Hansell
You know, Raj, A Better World is a social enterprise as well and we are big believers in the Conscious Capitalism movement. So we are very excited to talk with you about these issues and ideas. As a founding member of the Conscious Capitalism movement. Can you tell us what that means?

Raj
We are very passionate about changing the narrative around what business is and can be and the role that it plays in society. We think that there has been a very toxic narrative built up around business, and the story that we tell ourselves ends up being reflected in our actions and our reality. For a long time there has been this corrosive narrative that business is narrowly focused purely on self-interest, purely on profit and that everything else needs to be a means to that end. And that is a damaging way to look at business because it then creates as many harms and sometimes more harms in the world than it does good. And its also not an accurate reflection of what truly their businesses are about. So we are recognizing that there is a purpose to business that goes beyond profit and thats really what enables business to have a positive impact in the world. Both starts with the idea of higher purpose and we can get into the different tenants of conscious capitalism as we go along. But it was really recognizing that business has extraordinary power, extraordinary reach and extraordinary impact in our world. And if we dont practice it with a higher degree of consciousness about those things, then we can do as much harm as we can good through the institution of business.

Raymond Hansell
You actually call capitalism the greatest system for innovation and social cooperation. Talk a little bit about that for our listeners.

Raj
If you look at what we mean by capitalism it is really free markets and free people creating the enabling conditions were people can come together from organizations in order to do things you cannot do individually. And really the bulk of this can be seen in the last couple of centuries. It's really only the later part of the 18th century, really the market turned around in 1776 with the publication of Adam Smith's classic book, The Wealth of Nations; his inquiry into the nature and causes of the wealth of nations where he explained the power of market. And of course the United States was born more as an idea than a country in that same year. And the combination of freedom, political freedom and economic freedom has really been extraordinary. So if you look at how much humanity has progressed in those last two centuries after millennia in which our per capita income on a worldwide basis were $500 or less for almost all of history which means people lived on less than one dollar a day, you know we have seen extraordinary gains in those last two centuries and it has gone up 15 fold on a worldwide basis and 100 fold in highly developed countries like the U.S. But our life expectancy has more than doubled in that time, our literacy has gone from 10% to 90% and our population has risen from a billion to well over 7 billion now. We have so many more human beings leading longer and more fulfilling and far less miserable lives. In substantial measure because we have embraced this notion of freedom and allowed people to create value and exchange value with each other in a systematic way which has also had great deals of efficiency and technological innovation built into it.

Raymond Hansell
Its a great deal to be grateful for.

Raj
Certainly.

Raymond Hansell
You say entrepreneurs particularly are the true heroes in a free enterprise economy. Can you elaborate on that?

Raj
Yes, because if you look at the defection of business people in our culture, actually in most cultures, movies for example, etc. you will rarely find entrepreneurship in business enterprise elevated; in fact it is usually the villain of the piece. It is interesting that he made the movie the Manchurian Candidate which first came out in 1960 and that actually refers to the Chinese controlling this potential presidential candidate. And they remade it a few years ago and this time around the controlling entity is a corporation. Weve created this narrative where the villains are always the business people because they're greedy and selfish and exploitative and that's kind of the story that we have told. But really if you look at how we human beings have progressed it is really the entrepreneur that have taken the extraordinary risks that have gone out there and created things that we could not even imagine could exist and have brought them into reality and have transformed our lives in the process. The list is too long to go through of all those innovations that have come out of the institution of business; not only products and services but life enhancing technologies of many different kinds. So you know that has really enabled human progress to happen in a far more dramatic way than any other institution in society. We really believe that entrepreneurship needs to be celebrated. It is kind of the secret to the extraordinary prosperity and not just material prosperity but I think human flourishing that has been brought about. And we need to create the conditions where that is encouraged and celebrated and enabled not only here but around the world because that will create the opportunities and continue to uplift people. So even though we've gone from 90% living on less than a dollar a day to about 13% now; that's still a lot. That's a billion people and I suppose there are many other people that have many needs that are not yet met so we certainly need to encourage more entrepreneurship and we do that by celebrating the idea of entrepreneurship.

Raymond Hansell
In doing so lets talk a little bit about the myth that profit is the sole purpose of business whether it is an entrepreneurship or a large public corporation. What is that myth all about?

Raj
This is a very toxic and narrow perspective that has been created. We tried to go back and look at where that came from. The people who have started enterprises early on have a deeper purpose for it. They were building communities they were providing livelihoods, they were moving us forward. But sometime in the 19th century I think the story got hijacked and part of it was the loss of a moral and ethical foundation. It used to be kind of grounded in the Judeo-Christian traditions and as we became a more secular world some of that got lost and then the economist came in and started to look at business and they saw that the most successful, enduring businesses were also profitable and they started to create mathematical models and so forth. And they created elegant models which simplified what business was about and they made it about profit maximization. And they said, well that's the purpose of an enterprise And that whole notion became the foundation for the Marxist Critic that this is about the few getting wealthy at the expense of the many; this is where people will purely focus on the profit motives. And I think that whole narrative Adam got imbibed and it even started being taught in business schools that that is your fiduciary responsibility; that the purpose of corporations is to maximize profits. Milton Freedman wrote an essay in 1970 or so in the New York Times and that kind of crossed over into the mainstream culture and he basically said, the only responsibility, the social responsibility of a business is to maximize its profit while staying within the law. And so all of these things kind of became imbibed and accepted. And as I said it has done a lot of damage because it is certainly not true of great businesses. And it is certainly not true of human beings in general. If you think about why do we do what we do in this world? We don't just chose occupations simply in order to earn a living. Why does somebody have a passion to go through medical school and become a doctor? Well hopefully somewhere inside them is a spark that has to do with the need to heal people right, and that's something that's a passion for them. And people who are going into law should be driven by a keen sense of justice, etc. For every profession make reference to some kind of a higher purpose that relates to a societal good. Why do we then say that businesses are the exception and that they are the ones that are purely in it for the money? I think every great business tries to do something great in the world; and through that they generate profits. We need profits in order to grow in order to continue to evolve and to actually, to realize the purpose. But that is a means to an end; the purpose is something other than profit.

Raymond Hansell
As the first of the Four Tenets that you mention in your book of Conscious Capitalism, lets talk about that because it doesnt start with the profit, in fact its not even one of the four tenets. It starts with: Higher Purpose. So what does that mean for a corporation?

Raj
Well it says that we have to find it in our individual journeys as human beings. To recall the book by, Rick Warren called the Purpose Driven Life that came out 8 to 10 years ago and it has become one of the highest selling books of all time selling, 14 million copies. There is a hunger for meaning and purpose. We all want meaning and purpose in our lives. We want to know that we stood for something that we were meant to accomplish; something that we did something other than just exist and earn a living. You know, you go to work and come home and watch TV, have dinner, go to bed and go to work and do it again. There is something beyond that. And I think for businesses as well there is an inspiring energy that comes when you come together with a vision of something grand and something noble and something worth doing. And you know that releases extraordinary amount of energy inside human beings. When people are inspired they are capable of extraordinary things. And ultimately every organization runs on human energy. Creative inspired human energy is the differentiator in the world. And if you have purpose that resonates with people then you can identify the people for whom that particular purpose is meaningful; then it really creates the conditions for extraordinary innovations for great amounts of caring and also truly fulfilled human beings. When you are living your passion where your work becomes not just a job or career but a calling, I was born to do this; this is when I am most fully alive.

Raymond Hansell
How does a company go about defining its purpose? Also, if it hasnt had that purpose how does go about finding the purpose if it didnt already start out with one?

Raj
You know, why did they come into existence, what is the need that they saw, what is the need that they were trying to fill? What was the passion there? So sometimes with existing businesses, it means going back to your roots and finding out what made you successful in the first place and what was the passion? What's the underlying kernel there that relates to a real need in the world and not just satisfying wants and desires but actually fulfilling real needs that exist in the world? And over times sometimes those get, as a company grows and evolves and comes under professional management and the founders go out of the picture, very often then it reverts to the mean and becomes all about the numbers and the profits. But we have to excavate the original intension and purpose by going back. If that doesn't result in identifying a purpose then you can look at where are we today and where are we capable of contributing. How can we figure out the way in which we can add greater value in the world today that would inspire not only our employees but actually attract certain customers and communities would embrace us and so forth? So how do we distill that down into something that connects to what we do well, our Core Competency as it is called, right? But that should be in the service of profit but also what the world needs. And those needs change over time. Companies start out with a purpose that is relevant and meaningful to the world but then the world changes, those needs change, if you look at fast food you look at McDonalds, and Coke and Pepsi? When they started out we didn't have the same issues in the world around obesity and diabetes and all of those kinds of those things; and there weren't that many artificial ingredients in the products and so forth. And now with the health crisis that we have those kinds of companies have to rethink their offerings. When they came they were offering great amounts of convenience and affordability and so forth. And so there was a sense that they were doing something meaningful. So it's really a unique journey for every company. One of the things that we are discovering, and it's the objective of my next book really, is that it doesn't always have to be, your purpose doesn't always have to be reflected in a noble product per say. There are lots of products out there that are necessities that we need to produce and have and you can't necessarily find an inspiring aspect to the product itself but you can still as a company have a purpose that is around how you impact the lives of people. Because every company, it doesn't matter if you are making toilet paper of toothbrushes you impact the lives of many many people; not only the people who work there but their families, their communities, your customers. So if you start to think also in terms of how to have a people centered purpose in addition to a product centered purpose, ideally we have both, but certainly we must make sure we don't lose sight of the people in the process.

Raymond Hansell
We need to take a break now, but well be talking more with Raj Sisodia and my cohost MarySue about the Four Tenets of Conscious Capitalism when we come back. Well be right back!

Raymond Hansell
Youre listening to BetterWorldians Radio and we are speaking with Raj Sisodia, coauthor of Conscious Capitalism. And now lets welcome back Raj and MarySue.

MarySue Hansell
Hi Raj!

Raj
Hi.

MarySue Hansell
Lets continue talking about the Four Tenets of Conscious Capitalism. The second tenet is Stakeholder Integration. First of all, would you tell our listeners, what is a stakeholder?

Raj
A stakeholder is anyone who is impacted by your business or can impact your business. The obvious ones are of course employees, customers, suppliers, investors and communities that you operate in. Beyond that of course there are other stakeholders too, they might be somewhat secondary but they still need to be considered; regulators for example or unions or public interest advocates for example. There all kinds, depending on the business you are in; there might be different stakeholders to consider as well.

MarySue Hansell
Thats interesting. How does Conscious Capitalism actually integrate that concept?

Raj
So, one of the biggest challenges for businesses is that first of all, looking at stakeholders a different way. So the traditional way that companies, when you say that profit is your primary purpose of a business is what you are saying is that the investors are the primary stakeholder, so that is the end that you are trying to achieve. High results, high returns for investors. And everything else becomes a means to that end. So you systematically played off the interest off employees, or customers, suppliers, communities, etc. in favor of the investor. What we realize is that when you take an interconnected and interdependent system, which is what a business is along with all of its stakeholders, you know it's an intricately connected system where all of these entities are working together in order to create the ultimate values; value that the business is realizing. In any interconnected interdependent system, if you start operating that system for the wellbeing of one part of it, the whole starts to suffer. My body is one big, big system and if I start to systematically only favor one part of it and let everything else subside or not flourish then ultimately that organism will die and the same thing is true of businesses. So we have to look at, how can we create, not trade off scenarios, right? Which is very common in businesses, we look for tradeoffs. We say okay, I need to do more for my employees because I am not able to attract and retain talent, etc. But breaking that idea of tradeoffs and saying how can we create, instead of, trade off implies a win lose, how can we create a simultaneous win for all of the stakeholders? How do we align their interest together so that what is good for employees, is good for customers, is good for suppliers, good for investors, etc. And thats the real challenge for conscious business. If they actually really address that issue very seriously and if take creativity, you know human creativity is the one unlimited resource on this planet and we don't deploy that often enough. And what these businesses find is that very often you can come up with a creative outcome that simultaneously delivers positive outcomes for the different stakeholders and you don't have to make those tradeoffs. So rejecting the idea of trade off thinking across stakeholders and looking for a commonality of interest, and when you have a purpose it makes it easier.

MarySue Hansell
Raj how do you make the customer part of the team? What are the benefits there?

Raj
So, customers first of all, if you have a purpose driven business and the customer care about your business in terms of what your trying to do, actually they are engaged with you on a deeper level that simply buying your products and services. So you have a deeper relationship with customers than just a purely transactional one; because they are part of your ecosystem, they get involved in different ways with the business. So, with all stakeholders in a conscious business you engage with them in a sort of multi-dimensional way. Your relationships that your employees have with your customers very often involve in supporting some of your nonprofit activities, so at Whole Foods for example, there is the Whole Planet Foundation; many of their customers are involved in that. They actually support that foundation through their donations and other things. So it becomes like we are part of the same movement. You happened to be a customer, I happen to be an employ but we all believe in natural and organic food for example. Right, if youre in the Whole Foods space. And many of their employees come from the ranks of their customers; many of their customers become investors in the business if they truly believe in the business; they can buy shares in it. So it's possible for every stakeholder to wear multiple hats.

MarySue Hansell
I was reading in your book too that employees are stakeholders and that Whole Foods really walks the walk and they have a policy that all the employees know what everybody else is making. I was really surprised at that. And also that they have a practice of capping top salaries to 19 times the average employee salary, as opposed to some companies are more than 100, right?

Raj
Well the average, I think out there is 275 or 300 to one. It's been as high as 500. But the CEO pay to the average pay in the company that ratio has been rising steadily over the last 3 or 4 decades. It used to be at the average company 20 or 30 times and has risen now into the 100's and you know there is a lot of discussion around that Issue where we are looking at the impact of that ratio: CEO pay to average pay and what that has on employee engagement and employ satisfaction and also customer satisfaction.

MarySue Hansell
What is that out of curiosity Raj?

Raj
Well we are finding a negative relationship there. The higher the ratio the lower the level of employee engagement and employee satisfaction because that reflects a culture in a company that is all about the profits all about the numbers and you have leaders who primarily care about that and they are heavily incentivized to increase profits and they are not really creating an enterprise that is built on a purpose that is engaging employees, etc. That it is in fact treating employees to that end and therefore paying them the bare minimum or as little as you can as opposed to the other companies where they are actually treating employees as perhaps the most important stakeholder in many ways because they are the most invested, even more than investors employees are really invested in the business, right? I mean they spend most of their waking hours there.

MarySue Hansell
If the employees are not happy the customer wont be happy.

Raj
Exactly so there is a certainty, there is a virtual cycle to all of this right? So when you operate in a conscious business mode all of these things feed each other in a positive reinforcing loop. As you said happy employees, satisfied employees become more productive, engaged provide great customer care, there more innovative so customers are happy and delighted, they buy more, they talk about it with others, right, so you get the benefit of free marketing so you don't have to spend as much on paid media and that of course generates better returns to investors. It also generates more money that you can use to invest in the community and the environment and all of those kinds of things and it all feeds back into a virtual cycle.

MarySue Hansell
Speaking of those investors how do you get those investors. How do you get the financial stakeholders connected to a businesss higher purpose? It seems like it is difficult.

Raj
It is difficult, certainly in the past that has not been part of the discussion with investors. It has always been around numbers, profit margins and whats the growth rate and all of that kind of thing. But increasingly now we are finding that investors also care about what they are investing in. And first of all there are two kinds of investors: People who truly invest which means that they have a long term perspective and they are trying to create something through that investment and then you have the people who are short-term investors which is really a contradiction in terms. There is no such thing as short-term investing, that is speculation and that is not investing. You are just placing a bet and walking away very quickly from the enterprise. So, businesses need to be selective about their investors. They need to have investors who actually understand what they do and care about what they do and to have a longer term perspective. And recognize that when you have patience and you understand and align with the purpose of the business that in the long-term such businesses outperform so it is in your best interest as an investor even if youre purely interested in financial only. That if you identify companies with a higher purpose and take a long-term perspective our research shows the first companies in my Firms of Endearment that came out in 2007, those businesses outperformed the market by a 9 to 1 ratio over a ten year period. And we have a second addition of Firms of Endearment that just came out a few months ago. And you have a larger set of companies and over a 15 year period those companies outperform 14 to 1 relative to the market as a whole. So in the long-term this is an extraordinary value creation system because it aligns all of the human energies in that system in the right way.

MarySue Hansell
When talking about the system I wanted to make sure we talked about the Third Tenet, which is Conscious Leadership. Will you share youre thought about that?

Aj
Yes, all of these are very critical but I think leadership, you cannot have a conscious business without conscious leaders. What does that mean? You know we have, leaders have been historically motivated by some combination of three things. Its power, its money, or it's a purpose, right? So we have some of the military style leaders which are all about power; we have the mercenary leaders which are all about money and then we have the missionary leaders who are all about the people and the purpose. And what we are seeing is a shift toward missionary leadership. That, we used to have corporations that didn't pay their employees very, very highly if you go back 70, 80, 100 years but they had extraordinary amounts of power. This is command and control military style organizations that we had. Back where there was Ford or AT&T or General Motor. You know you had a million people working there and they do what you tell them. And then starting in the 70's, 80's, 90's it became all about money and CEO's started compensated extraordinarily highly with huge amounts of stock options and you started attracting people who primarily cared about money. And they knew how to manage the numbers and they were pretty ruthless. They didn't see human beings as flesh and blood people but as resources as assets as costs to be minimized and so you had all of the things that we know about in terms of mass layoffs and so forth.

MarySue Hansell
They gave us all that toxic feeling that you mentioned.

Raj
And now what we are seeing is that conscious leaders are truly motivated first of all by purpose and by people and so they are servant leaders. Why does one become a leader? If it is to use other people to meet your goal and your objective, which is what a lot of leadership has been traditionally but that's not leadership, that's tyranny. I mean, how is that any different than the kings of old? They just basically used everybody, you know people are suffering around them and they were trying to prosper in the middle of all of that. That's not leadership, that's not leadership that's tyranny. So we need people who are primarily motivated by service, who are humble who see this as an opportunity to serve, create value and improve the lives of others. So they live in an other's centered universe, they tremendous amounts of emotional intelligence, empathy, understanding of human beings. They have spiritual intelligence, they understand meaning and purpose and how important a drive that is for human beings and they themselves have that. They have a systems mind, they can see the whole, and they can see the interconnections. They don't view business as a machine with inputs and outputs they view it as a living organism and the understand how to create flourishing for the whole organism.

MarySue Hansell
You know Raj we only have a couple of minutes left and I did want to ask you, how can business owners or managers be more conscious?

Raj
I think this is really a question for all of us. We should all be on a journey of constantly growing and deepening our own consciousness. There are some practices that certainly help in that, contemplation. So it's the self-awareness, understanding yourself, developing personal mastery, using some form of contemplative techniques, meditation for example; but also having experiences that deepen your understanding of life and of a human being. And deepening your empathy and understanding and putting yourself in the shoes of other people and starting they recognize that ultimately what delivers the deepest satisfaction to human beings is what Viktor Frankyl talked about, happiness. Happiness cannot be pursued, happiness ensues, it is living a life of meaning and purpose. And getting in touch and asking oneself, what is my purpose in life? How do I have meaning and how can I deepen my own understanding of myself and others. That's called a journey.

Raymond Hansell
Were going to take another break at this time. This might be a good time for all of our listeners to contemplate some of this and really chew on it because there is a tremendous amount to think about in terms of purpose. When we come back, well talk about the final tenet of Conscious Capitalism with Raj Sisodia and my cohost Greg. Well be right back!

Raymond Hansell
Were back now with Raj Sisodia, coauthor of Conscious Capitalism.

Gregory Hansell
Hi Raj, this is Greg.

Raj
Hi Greg, nice talking to you.

Gregory Hansell
A few weeks ago we interviewed Bob Buford, a close friend of Peter Drucker. And in your book you quote Drucker as saying, Culture eats strategy for breakfast. Tell us about the Fourth Tenet of Conscious Capitalism, Conscious Culture and Management and what that means?

Raj
I think this is really a question for all of us. We should all be on a journey of constantly growing and deepening our own consciousness. There are some practices that certainly help in that, contemplation. So it's the self-awareness, understanding yourself, developing personal mastery, using some form of contemplative techniques, meditation for example; but also having experiences that deepen your understanding of life and of a human being. And deepening your empathy and understanding and putting yourself in the shoes of other people and starting to recognize that ultimately what delivers the deepest satisfaction to human beings is what Viktor Frankyl talked about: happiness. Happiness cannot be pursued, happiness ensues, and it is living a life of meaning and purpose. And getting in touch and asking oneself: what is my purpose in life? How do I have meaning and how can I deepen my own understanding of myself and others. That's called a journey. Yeah, so the culture is something that a lot of companies don't pay enough attention to, you know every company has a culture whether they realize it or not, but if you don't pay conscious attention to "how" - purpose is the "why" and stakeholder is the "what" and the conscious leaders are the "who" and this is the "how". How do we do things around here? How do we relate to each other, what are the values that we seem to embody and that we seem to care about? And when that is done explicitly and we try to understand what are the cultural traits that we value and then we promote those and we make sure those are reflected in our behavior and so forth then that can become a very, very powerful source of competitive advantage but also of energy and success for the business. It is unique for every company, its culture, based upon its history and what's it's trying to do; and the leaders. We have tried to identify some of the qualities that we see in common across many conscious cultures. And thats captured in this mnemonic tactile that we use in the book. It starts with trust. You have to have a high level of trust inside the organization between the employees and the leaders and certainly across employees with customers and everybody else. That is the commodity that is actually in greatest need, that's in shortest supply in the world is trust. There has been a bit of an epidemic of decline of trust in general in society and therefore focusing on that is extremely important. And you build that through actions over time; authenticity, accountability, transparency, that we talked about earlier with salaries and other things, integrity. All of those are important elements, loyalty, egalitarianism, etc. The one I think to me, if I had to pick the most important differentiator between a conscious business and a traditional business, it has to do with the idea of caring, or love and care. If you think about how most businesses operate, they operate with a tremendous amount of fear and stress. That's how people are motivated or thats' how they think they need to motivate people, by putting a lot of pressure on them by holding out these carrots and sticks. Riders we call them. Fear of losing your job, or getting demoted or not getting a bonus etc., etc. It's all the anxiety around that. So we have created a culture where people for the most part, I would say 70 or 80% of people do not look forward to going to work. On the one hand we say thank God its Friday and we have a restaurant chain that, you know that whole idea of me central to our culture, nobody questions it. And then we have the statistic that how does that go up by 20% on Monday? People are truly experiencing significant impacts over the kinds of toxic environments that exist. So if we create a business on love and care, what does that mean? So, that means people care about what they do, their passionate about it, right, it's their calling. They believe in what the business is all about and they have the care and respect of the people they work with. Right, so you love the people you work with and you love what youre doing why would you not look forward? Work can be deeply meaningful and deeply satisfying. Freud said, love and work are the cornerstones of our humanness and yet we have separated the two completely. And if you do that in the rest of your life and when you come to work it's all about your self-interest and my self-interest and the fact is they we are asking people to divide their humanity or their persona's into these two and bring that less human half to work.

Gregory Hansell
I have work for companies that have that culture of fear, I wont name that on the air but that kind of panopticon, you know always being watched experience and its amazing what it did to the culture. It was cynical and unhappy and about ones managers and the companys motives. And I have worked in companies that are the opposite where people are really inspired by the missions and the vision of the founders and the company and what we are doing together and its night and day.

Raj
It is extraordinarily different because when u are operating out of fear then your physiological response to fear is to go into a survival mode. That is fight, flight, freeze or faint. Essentially the responses are not very productive in terms of doing extraordinary things in the world. So we can either operate out of fear or out of love, those are the two choices and we need to create cultures where love is the predominant quality where we truly care about each others human being. We measure our success by the way we touch the lives of people.

Gregory Hansell
You know an example of conscious dis-management, I really love this story about the snow storm at the Whole Foods in Connecticut, can you share that with our listeners?

Aj
Yes, so this was in the Hartford, Connecticut store and this was a few days before Christmas, 3 or 4 years ago now. There was a big snow storm coming and so a lot of people were leaving work early and stopping by the store to stock up. So the store was jam packed and there were long lines at the checkout. This store was going through a technology conversion, its systems having been acquired from another company and suddenly all of the cash registers stopped working and they couldn't take credit cards, they couldn't take checks, they couldn't take cash, nothing. And so lines are growing longer, people are getting frustrated; the weather is becoming more ominous by the minute. So, the assistant store manager, the store manager wasn't even there at the time. The assistant store manager saw this and made a quick decision right on the spot and basically said to all of the cashiers, just get the customers through; bag their groceries and let them leave. And when they came to the front of the line and said, okay how do I pay? The said, you don't have to pay because our systems aren't working and we want to make sure you get home safely so, Merry Christmas and a happy holiday and be on your way. People were rather stunned by that and said, no I am going to come back tomorrow or next time I come and tried to pay you but they said, no you don't need to. Some people said I am going to make a donation to the food bank. They said that would be great if you want to do that but again you don't have to do anything. This went on about 40 minutes I think and they got people out of there and then the registers started working again. I think they had given away several 1000, 4 or 5000 dollars worth of groceries by that time. And that seemed to be the end of the story. A few days later one of those customers called the local newspaper, the Hot Foot Current and said, do you know what happened at Whole Foods the other night and told the store to one of their columnist who then wrote a little story along the lines of the Holiday Spirit is alive and well at Whole Foods and why can't other companies be like this and so forth? And that story began to be getting share on the website or the newspaper and started bouncing around the country. It made its way into the top ten most emailed stories of the day on Yahoo. And that's how the CEO sitting in Austin 3 of 4 days later saw it come across his computer. And he forwarded that to me and said, this is something nice that happened in Hartford, but this kind of thing happens all the time. Our people do the right thing and they don't have to ask anybodys permission and they don't do it because they think it is going to result in positive publicity, etc. But it inevitably ends up becoming a positive thing for us. Because think about 4000 dollars worth of groceries verses the goodwill that they earned through those actions but they did it for the right reasons. The store manager did not put out a press release saying, look how good we are? So when you consistently do the right things for the right reasons I think the universe operates in a way that that comes back to people dramatically or enhanced.

Gregory Hansell
We believe that here a BetterWordians Radio and you know I also thought that that story is a great nexus of a lot of things you talk about in the book because it is at that center of accountability, caring and creativity. As a manager myself I know that if people get micromanaged and they have not responsibility there almost automata but if they have the ability to be creative and be responsible for something then you are amazed by what people can do and thats what invests them and gets them caring about the company and about the customer. And its a powerful experience. I know you have heard a lot from business leaders since the book was first released, can you share one of those stories that youve heard.

Raj
There have been a lot of companies that have been embracing these ideas and starting to change. I am working with a big food processing company that is doing that and I am working with a big steel company in Korea that has embraced these idea. Again, all of them are experiencing, it takes time but you start to experience the positive benefits of this fairly quickly actually, within a year or so. You start to see greater levels of employee engagement and caring and commitment and compassion and all of those things. It really does make a difference.

Gregory Hansell
You also told a story in a book that struck me really powerfully. You saw a billboard that said, it was in New York City, I believe at a bus stop.

Raj
Thats right, yes.

Gregory Hansell
Thats really horrible.

Raj
This was from Careerbuilders.com. Which is a website to help people find jobs. It reflects kind of the cynicism but also the reality that unfortunately that most businesses explicitly said that they care about one thing which is shareholder wealth and maximization. That is a damaging thing that we really have to get rid of. And its not even true if you look at the law. The law does not say that the fiduciary responsibility of the board of directors and the CEOs of the company is to maximize shareholder profit; it doesnt say that. CEOs do not work for investors they work for the corporation and the corporation is its own thing. The flourishing of the corporation is what you are supposed to be accountable for and that means the flourishing of every aspect of that corporation. Which means all of the stakeholders.

Gregory Hansell
Definitely and I think one of the more important aspects of that, that you brought attention to is that society is steadily moving toward a better world, you say in the book, in which a more accurate statement would be, if your company doesnt care, it wont be in business for long. So I was hoping in the last, we have about two minutes left, if you could tell us about that better world that you envision, the principles learned in conscious capitalism can help bring about.

Aj
Yes, so we envision a world in which, first of all we can bring the benefits of modernity and greater prosperity and a sense of wellbeing to more and more people in society. We still have a billion people living in extreme abject poverty and still we have 3 billion living on less than three dollars a day and there are a lot of unmet needs in the world. How are those needs going to be met? They will not be met by governments or even by non-profit or religious organizations. Those institutions cannot lift people out of poverty. Business is the only institution that has done that and that can do that and that makes business a basically heroic institution. And so we need to spread freedom around the world because the real issue is ultimately, we talk about income and equality which is important but it is not the unequal distribution of income as the unequal distribution of opportunity to enable people to be uplifted through the institution of business. So our vision is that we spread the ideas around. business, but not just business but a conscious approach to business, a loving, caring approach which is rooted in truly understanding the deepest human motivations around higher purpose which is led by individuals who combine tremendous strength with the tremendous capacity for love and care and they create businesses in which we promote not just human but planetary flourishing for all species into the indefinite future. And that's really something that I think is very much within our grasp. We see that it is already possible, it exists, and companies are doing this in their communities. Many of them and it is simply a matter of extending that and changing the way people think about these things. You know if you change your perspective everything changes. You start to look at things through a different lens. Change the mental model that we have grown up with about business. That it is about selfish exploitation and greed and it all about making money. If we believe that then we are going to act that way but if we change the story and we say that business is good because it is based on creating value and business is fundamentally ethical because it's about voluntary exchange it's not about cohering anybody. It's not about cohesive power but it's all about business uplifting human beings; it's noble and it's heroic. It lifts people out of poverty. When we recognize the power of that story in the opportunity to impact the lives on a huge scale around the world then it becomes very energizing and very exciting to be a part of business.

Raymond Hansell
You know Raj, you say in your book under the paragraph, A Shared Dream, in the back of the book that your movement is quite simple. That one day virtually every business will operate with a sense of higher purpose, integrate the interest of all stakeholders, develop and elevate conscious leaders and build a culture of trust accountability and caring. And frankly thats where we resonate the most because we here at BetterWorldians do this show because our vision is to make the world a better place by focusing on and encouraging the best in everyone. We focus on positive behaviors, positive values, and positive change. We accomplish our vision with a commitment to values, a focus on todays and tomorrows generations, trending technology, and a belief in capitalism as a force of good. So, I would like to particularly thank you for joining us today on BetterWorldians Radio today.

Raj
Thank you it was my pleasure to be with you.

Raymond Hansell
You are very, very welcome. You can find out more about Raj Sisodias work by going to rajsisodia.com and in the mean time we would like to thank everyone for listening today and you can join us also at the BetterWorldians community at betterworldian.com. Until next time, please be a Better Worldian. Thank you again for making the world just a little bit better this week. Please join your hosts Ray, MarySue and Gregory Hansell next Thursday all 11 AM Eastern time, 8 AM Pacific on the Voice America Variety channel. We hope we have inspired you to do one small thing to make a big difference. Join us a BetterWorldians.com to tell us what you have done to change the Thanks again for listening to the preceding program brought to you on the Voice America Variety Channel. For more information about our network and to check out additional show hosts and topics of interest please visit voiceamericavariety.com. The Voice America Talk Radio is the worldwide leader in live internet talk radio. Visit voiceamerica.com. The views and ideas expressed on the preceding program are strictly those of the hosts or guest and do not necessarily reflect the view and ideas of the Voice America Talk Radio Network its staff and management.