Can 'Creative Capitalism' Solve Big World Problems?
Bill Gates says many of the world's biggest problems -- energy, poverty, disease -- are too big to be fixed by philanthropy and government aid alone.
The solution he offered to an World Economic Forum audience at Davos this year was "creative capitalism."
"Such a system," he said, "would have a twin mission: making profits and also improving lives for those who don't fully benefit from market forces. To make the system sustainable, we need to use profit incentives whenever we can."Can capitalist principles and incentives help solve Big Problems? Harvard Business School history professor Nancy Koehn says Gates is right on target, and at a right time in history.
For an online forum on the topic hosted by Michael Kinsley and Conor Clarke, Koehn writes that five forces are converging to support the rise of creative capitalism:
- Business controls the resources -- people, innovation, traction, money, and execution -- to make a difference.
- Companies are being held accountable for their social impacts by a new generation of consumers.
- Traditional hierarchical business organizations are evolving into new forms around global networks.
- Increasing transparency into organizations by regulators and media is forcing organizations to be more responsive to public pressure.
- Thriving business leaders such as Oprah Winfrey and Warren Buffett are being applauded "partly because they consistently pursued something more than the next market-dictated score."
For a dissenting point of view on Gates' motives, see BNET blogger William Holstein's rant, Bill Gates and Creative Capitalism -- Oh, Give Me a Break!