Stakeholder Capitalism

8Concept

Given the downsides of our global economic system, it is clear we must reform it. But how?

The world currently knows two prevailing and competing economic systems: shareholder capitalism, which is dominant in the United States and in many other countries in the West, and state capitalism, which is championed by China and is gaining popularity in many other emerging markets. Both have led to tremendous economic progress over the past few decades. They left us with a world that is more prosperous than ever before. But each has equally brought about major social, economic, and environmental downsides. They led to rising inequalities of income, wealth, and opportunity; increased tensions between the haves and the have-nots; and above all, a mass degradation of the environment. Given the shortcomings of both of these systems, we believe we need a new, better global system: stakeholder capitalism. In this system, the interests of all stakeholders in the economy and society are taken on board, companies optimize for more than just short-term profits, and governments are the guardians of equality of opportunity, a level-playing field in competition, and a fair contribution of and distribution to all stakeholders with regards to the sustainability and inclusivity of the system. But how can we achieve this? What does it look like in practice? And where did the current two systems go wrong?

Let us start with the last question first and take a closer look at the two prevailing ...