They call it capitalism and it is not.


Preparing this week for a talk that I have given at the ‘Impact Hub’ in Madrid before a group of organizations and companies committed to the movement in favor of purposeful capitalism that seeks to transform society and the planet by causing real positive impacts by taking advantage of the strength of companies and their decisions, I remembered that character from Moliere who had been speaking prose for forty years, without knowing it (The bourgeois gentleman). Because sometimes history doesn’t evolve through sharp cuts and radical leaps, but transformations, even the most disruptive ones, unfold over years, sometimes decades, until suddenly you realize that, for example, Artificial Intelligence is already an irreversible presence in our way of organizing things.

Something similar occurs with the prescriptive reflections that, even from conservative forums such as Davos or the Business Roundtable, have been made about the mutations that our economic system is experiencing. To the point that I believe the time has come to confirm that a qualitative leap has occurred, due to the accumulation of interrelated changes, which place us in a scenario that cannot be described, strictly speaking, as capitalist. At least, not without adding many adjectives.

Let’s start by describing what we have been taught as capitalism and what liberals still defend today: an economic system based on private ownership of the means of production, with companies that are the engine of growth, that have private owners that seek to maximize their profits. profits and thereby, thanks to competition and the invisible hand of the market, the social optimum is achieved. All of this intrinsically entails essential aspects such as: minimal presence of the state and the public sphere (liberalising is positive, the state is the problem and taxes are theft); zero-sum relationship between employers and workers when it comes to cutting costs and sharing the surplus; economic system that does not take into account the planet, except as natural resources that can be privatized and as external effects, positive or negative.

Away from the models

The current panorama is very far from that caricature. It is, of course, in the models of autocratic state capitalism (China, Russia) or in those of corruption capitalism in those countries where drugs and crime are what mark economic, social and political life. But it is also far removed from European and even North American models of capitalism. Starting with the most obvious: the role of the State as a positive determining agent by offering social cohesion and political democracy, but also regulation, supervision and control of the rules of the game or more recently, providing public goods such as training, innovation, or infrastructures, issues that allow improving the performance of private companies that take advantage of it, giving meaning to that classic phrase that taxes are the price we pay for civilization.

Mariana Mazzucato She has been the author who has most convincingly defended the role of the State as an entrepreneur, beyond its role as regulator or large public insurance against illness, unemployment or retirement, demonstrating how much of the private capital, especially in new technologies, they have taken advantage of prior public investment, without which today’s large technology companies would not have been possible. This symbiosis between the public and the private, far removed from the simplistic zero-sum relationship, was something that had already been confirmed by all the State-contracting companies in sectors as decisive as defense or infrastructure, which is extended to the knowledge economy. .

However, the most important change in redefining the capitalism of manuals is taking place within the framework of markets and competition in the face of the predominance of large technology companies that are becoming true alternatives to the state- nation (platform-state they are beginning to be called) and whose main asset is intangible (capitalism without capital) consisting of data, technology, algorithms. But, above all, we must highlight the change in the very meaning, function and purpose of the company in a globalized economy and in the midst of a climate emergency.

Question classical principles

Now, international movements such as BCorp or, in Spain, SpainNab, promote companies that seek long-term value, taking into account the needs of all the parties involved and of society as a whole. They defend impact investments, made with the purpose of generating improvements in the environment and in society, as well as economic returns. Two facts are explicitly recognized that contradict the classic principles of companies in textbook capitalism: first, that the shareholders (owners) are very important, but they are not the only important ones since the company also mobilizes others. stakeholders’: workers, suppliers, customers, society in general, whose interests must be aligned through adequate strategies of what has been called ‘stakeholder’ capitalism, which includes adequate transparency and strict compliance with the law, including tax law.

Second, to use the power, talent, contacts and experience of companies to put them at the service of solving social or environmental problems, in a concept that goes beyond philanthrocapitalism which, in turn, is already an advance with respect to to classic charity. By using the strength of companies as a motor capable of causing positive changes, a model of public-private collaboration is promoted that overcomes simplistic antagonisms.

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This movement transcends the concept of sustainability as something reduced to the environment and places companies as essential agents for the fulfillment of global commitments such as the United Nations Sustainable Development Goals, or those to reduce CO2 emissions to fight against climate change. or those of reversing the growing inequality that is feeding populism and putting our democracies at risk.

The paradigm shift with respect to the old capitalism is evident. Above all, when it is pushed by the financiers (banks, investment funds…) or the shareholders themselves and not only from the regulatory authorities. There is a long way to go. Starting by establishing it or by harmonizing the different metrics of all these impacts. But we must continue with the extension of this model from listed companies to all companies and sectors. So, even if we keep talking about capitalism, it will no longer be because it will have been transmuted into something else. Different and better. And it all begins, by implanting a soul in old capitalism. And that also rearranges the dogmas of the old ideologies. We will see.


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