Fast Company: 5 Myths Socially Conscious Entrepreneurs Need to Ignore

 

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Whether you call it shared value of Benefit Corporations, the future of Capitalism –Companies that Care– is creating a meaningful competitive edge for the businesses that embrace it.

A series of powerful forces are changing business as we know it. From the speed of communication to information accessibility, all lead to increased transparency and a more global perspective.

Whether we choose to define the newest iteration of capitalism as Shared Value,Conscious CapitalismInstitutional LogicBenefit CorporationsTriple Bottom Line,SRIESG, or Regenerative Capitalism, the fact is companies that don’t update their business practices are significantly less likely to thrive. Meanwhile, those that harness the power of purpose are capturing significant value and creating meaningful competitive advantages along the way.

Changes in the investment community reflect signs of this shift: In 2013, Harvard’s $30 billion endowment as well as the $170 billion asset manager Carlyle Group appointed their first Chief Sustainability Officers to administer Environmental, Social, and Corporate Governance (ESG) strategies. And both Goldman Sachs and Morgan Stanley have announced the launch of sizable sustainable and social impact investment funds.

This new, holistic approach to business may be the most significant movement of our time, as well as the most misunderstood. Below are five pervasive myths surrounding stakeholder capitalism today:

  • MYTH #1: IMPACT INVESTING IS A FANCY TERM FOR GIVING MONEY AWAY.
  • MYTH #2: ENVIRONMENTAL AND SOCIAL WELFARE ARE THE GOVERNMENT’S RESPONSIBILITY.
  • MYTH #3: THE POINT OF CORPORATE SUSTAINABILITY IS TO IMPROVE REPUTATION–ANYTHING MORE HURTS SHAREHOLDERS.
  • MYTH #4: IT’S HUMAN NATURE TO PRIORITIZE PROFIT OVER SUSTAINABILITY.
  • MYTH #5: STAKEHOLDER CAPITALISM IS A CHOICE.

Continue reading the article at Fast Company

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