This article has been published on December 4, 2020 on the World Economic Forum site
Professor Klaus Schwab, the founder of the World Economic Forum, has called for the abandonment of both “shareholder capitalism” and “state capitalism”, which have proven to be incapable of meeting the world’s challenges. He suggests that a “stakeholder capitalism” – a term he coined in the early 1970s – would enable a “Great Reset” of the global economy.
In recent decades, a series of approaches that adhere to the model of stakeholder capitalism have been proposed for companies, such as the Triple Bottom Line (TBL), B Corp, Benefit Corporation, and most recently, the Business RoundTable declaration on the purpose of the corporation or McKinsey’s 5Ps. This is a sign that society’s expectations towards business are rising and that companies are increasingly aware of them. The bad news is that the number of different approaches is confusing. For a leader who sincerely wants to adopt stakeholder capitalism, the transformational path to making it actually work is not clear.