The Social Conscience of Capitalism

Once you've been bitten by the social business bug, there's no stopping you

Muhammad Yunus is one of those people whose vision and personal example lead an entire generation forward toward a shift in thinking and ways of working. One of those rare individuals with the foresight, the idea, and the energy to actually change the world. His books offer answers to a whole range of questions and show how, with insight and persistence, an idea can be developed to extraordinary heights, as long as you believe in it and keep striving to do meaningful things.

Here I've gathered some excerpts from Yunus's own words, shared in an interview with The New York Times on the occasion of his latest book, "A World of Three Zeros," and his views on the shift that needs to happen in economic thinking. You can read the full article here.

These selected quotes from Yunus aim to distill his vision of the practical benefits of moving away from the classic paradigm of maximizing profit, toward one focused on solving problems and generating profit for the benefit of society.

"We must let go of our unwavering faith that markets driven by personal profit will solve all our problems, and recognize that the problems of inequality will not be resolved through the natural workings of the economy as it is currently structured," Yunus writes in his book.

How many of us notice, day after day, that something in the system is broken, and that traditional methods for helping those in need simply aren't working?

And more from Professor Yunus's views:

"The capitalist system is a machine that sucks wealth from the bottom and sends it to the top. This isn't the fault of the people at the top. They're simply following what the system asks of them: chase the money. But in that process, wealth at the top grows like a giant mushroom, owned by fewer and fewer people, for the simple reason that the more you have, the more you get. Wealth is a magnet. A small magnet attracts a little wealth. A big magnet attracts more. And this mushroom of wealth is worse than a mushroom cloud from an atomic bomb. It will destroy our politics, destroy our society, destroy our economy, because the concentration of wealth goes hand in hand with the concentration of power. All of this will generate enormous anger at the bottom, and that anger will end up tearing everything apart. Brexit is a result of that anger. So was the last US election. Now look at the German elections. This mushroom is a ticking time bomb. We should be losing plenty of sleep over it."

"The capitalist system rests on one fundamental flaw, a misreading of human beings. Capitalist theory assumes that people are driven entirely by self-interest. That is certainly not an accurate description of a real human being. Human beings are selfish, and at the same time, they are just as selfless, if not more so. They want to help others."

"Capitalism is entirely about opportunity. But within the economic system, there's only one kind of business recognized: business aimed at making money, and we've arrived at the more extreme belief that it performs best when it aims at maximizing profit. When we bring people's selflessness into the world of business, we open up a different kind of opportunity. Alongside traditional business, we add another kind of business, one that allows us to express our selflessness through it. The exclusive purpose of this other kind of business, which I call social business, is to solve people's problems."

Social business, following Muhammad Yunus's model, operates like any other business and generates a financial return, but the profit from it isn't distributed as dividends to investors and shareholders. Investors get their invested capital back, but nothing beyond that. We'll be sharing details about this particular model, along with examples of some of the most successful business projects, as part of the training "SOCIAL ENTREPRENEURSHIP – The Path for the Bold." Want to know more? Register to take part!

What are the benefits of this kind of business? Here's Professor Yunus's answer:

"If you remove the personal motive of profit and think only about solving problems, you'll suddenly see a great many opportunities that had previously escaped your notice. If selflessness becomes the driving force behind technological development, instead of personal gain, technology suddenly becomes an extraordinarily powerful force, one capable of changing the world very quickly."

"Once you've been bitten by the social business bug, there's no stopping you. If making money leads to happiness, making other people happy leads to super-happiness."

How should this transition happen? What does Yunus want to see in our educational structures?

"Introduce into the curriculum the idea that business doesn't have to be aimed solely at maximizing profit. Program design can instead focus on how to solve people's problems while still covering costs and replenishing financial resources. Students could be tasked with developing businesses that solve problems like: how to bring clean water to a village; how to provide education, literacy, housing, or healthcare to a remote community; how to turn an overcrowded ghetto into a decent place with healthcare, education, and good roads. Many universities are already setting up social business centers and teaching this. Every business school should offer both a conventional MBA and a social MBA."

Professor Yunus has been actively working since the 1970s to empower the poorest segments of society to achieve economic independence, through purely economic approaches. A strong focus and priority in his work has been the empowerment of women and the education of young people and adolescents. Through their work, the Grameen teams found that channeling income into a poor family through the woman brings the fastest path out of poverty and delivers real benefits for children, such as access to education and healthcare.

"I'd guess, or at least I hope, that at least 1% of the economy will become a social business economy on a global scale. If that happens, the bug will have bitten. The only way from there will be up."

You can learn more about Professor Yunus's work, Grameen, and his social business ventures on the Yunus Centre's website.