In early November 2008 at a retreat center just outside Austin, Texas, a group of just over one hundred executives, business owners, consultants and academics answered John Mackey’s invitation to talk about serving the world through the vehicle of business. The event was called the Catalyzing Conscious Capitalism (C3) conference, and was the first public gathering around a theory of business inspired by the leadership of John Mackey, the CEO of Whole Foods Market. The two central tenets of Conscious Capitalism as explained by Mackey are:

1. Every business has the potential to either discover or create a deeper purpose for itself, which goes beyond maximizing profits or shareholder value.

2. The most sustainable businesses over the long-term will consciously create value for all of their interdependent stakeholders‚ customers, employees, investors, suppliers, community, and the environment. Paradoxically, this principle will also create the most long-term value for investors.

Imagine my delight in sharing three days with Sally Jewell, Gary Hamel, Sir Ken Robinson, Jim Stengel, Robb Smith, Kip Tindell, Roy Spence, and Bill Strickland, just to name a few of the speakers, and all the other attendees who resonate with Conscious Capitalism. I must confess that I felt validated and also humbled, that the well known professionals in attendance shared my perspective and hope that the vehicle of business has the power to improve the wellbeing of humanity.

Each of the three days was filled with twenty-minute presentations on topics ranging from conscious marketing to finding your company’s purpose. Interspersed with the presentations where breakout sessions where we were asked to co-create the conscious capitalism movement. At the center of all of these interactions were the concepts of purpose and interdependency.

As is often the case in a group of this caliber, many of the attendees have authored books. Of the many fine books discussed two stand out for their relevance to a purpose and the interdependency of stakeholders. Nikos Mourkogiannis’ book, Purpose: The Starting Point of Great Companies, is as interesting a read as its author’s personal story. The book starts with Nikos’ personal and tragic account of his family’s slaughter in Greece at the hands of the communists and then flows into a three-part discussion. The first is what he considers purpose to be and what it is not. The second includes inspiring stories of company’s with purpose. Third, he presents how purpose can be used to build greatness. Mourkogiannis book pairs nicely with the aptly named, Firms of Endearment: How World-Class Companies Profit from Passion and Purpose, by Rajendra S. Sisodia, David B. Wolfe, and Jagdish N. Sheth. Sisodia, who was in attendance, presented on FoEs (firms of endearment) and their relationship to stakeholders. The book is organized around this same concept with each of the five stakeholders represented in the acronym SPICE.

Stakeholder Definition

Society: Local and broader communities as well as governments and other societal institutions, especially nongovernmental organizations (NGOs).
Partners: Upstream partners such as suppliers, horizontal partners, and downstream partners such as retailers.
Investors: Individual and institutional shareholders, lenders.
Customers: Individual and organizational customers; current, future, and past customers.
Employees: Current, future, and past employees and their families.

The event itself signifies something is happening; a movement is beginning create companies that focus on creating value through purpose instead of just profit. The timing seems perfect. Amid a wash of news stories documenting how excessive greed and profiteering led to our current economic crisis, there exist a growing number of business leaders that are calling for a reform of their craft. We see the same call to action echoed in the certification of B Corporations , which requires a company to change its operating documents to recognize the interests of all stakeholders over individual or groups of shareholders. The birth of the new L3C (Low Profit Limited Liability Company), which is often described as a blend of a non-profit and for profit structure, is an answer to social entrepreneurs needs to raise money from foundations for social serving ventures. L3C are now recognized company structures in both Michigan and Vermont. In short, Conscious Capitalism, by any other name, is ready to takeover as the Egoic Capitalism collapses on its rotten underpinnings.

But while I am bullish on this new way of seeing the art of business, you will need to be patient. Today’s economic downturn is forcing even the most well meaning CEO to deal with decreased sales, store closings and layoffs. As one retail CEO put it to me at the conference, “this is all well and good, but the reality is that I’ve got to get back into the office tomorrow and make some tough decisions to keep my business healthy, and so do a lot of other people here. I’m not sure how much time we’ll have to give to this movement.” Other attendees shared concern that John Mackey might not be the right face of the movement, or that no real change would occur until the capital markets began taking a longer term view and venture capitalist eased up on their expected returns. Still, the overall mood of the group was optimistic that this new approach to Capitalism, an approach that Wharton School Publishing calls, “the most fundamental transformation of capitalism since Adam Smith,” has the potential to be the major force that changes the direction of humanity and creates a better world.

The conference ended with the attendees dividing into groups each focused on an element of pushing the movement forward including plans for leadership, marketing and technology. An interim steering committee was created and an online wiki has been implemented to capture the input and wisdom of attendees. In January, a group of the key thought leaders met for a private retreat. It’s a slow start, but not unexpected. As with most movements, it will take time for it to find its voice, direction and leadership.

My personal reflections on Conscious Capitalism are mixed. While I find a deep resonance with the position that a business should have and evolve a higher purpose conceptualized as some form of the good, true, beautiful and heroic, I still find myself asking what the concept of ‘value’ means at a deeper human level. What might be possible? In the world of business, even among conscious capitalist, the word value is still commonly defined as money and power. And while I acknowledge the reality of our economic systems today, and applaud the Conscious Capitalism movement as a profound step in the right direction, I propose that future generations would be most efficient to focus on the creating value measured not by economic wealth, but by psychological and spiritual wealth. I further propose that such value should be generated directly by human effort and resource consumption and not diluted by the ubiquitous conversion into economic wealth. It is possible to create institutions that generate value and distribute it directly to where it is needed without having to first convert it into a nationalized currency. To create a future like that, we will need tools that do not yet exist. Bernard Lietaer has convinced me that the beginning of such a shift requires that we reinvent our money by doing away with nationalized currencies and instead create multiple forms of money designed to more efficiently transact value. Maybe the opportunity to create new forms of money, and with it new economic systems, will come sooner than we think. Until such time, consider me a Conscious Capitalist with deep appreciation for John Mackey and all the attendees in Austin this past November.

Steve Frazee is a serial entrepreneur. In the past three years he has provided consulting services to conscious companies helping to stabilize their operational practices so as to better serve their highest purpose and multiple stakeholders. He’s provided short term leadership and reorganization services for Ken Wilber at Integral Institute, and Brian Robertson at Ternary Solutions. Currently he is acting as CEO of SBNR.org, a company focused on aggregating and resourcing the millions of people world-wide that identify themselves as Spiritual But Not Religious.