“Karma Capitalism” happens when companies work for the benefit of all stakeholders, and Indian groups including the Tatas, Mahindras, Marico, Cipla and Fabindia are shining examples of this philosophy, says Rajendra Sisodia, who has founded a New Age movement that wants to put the human soul into market economics.
Rajendra Sisodia, co-founder, Conscious Capitalism Movement, says applying “karma” to the pursuit of profit means creating value for all stakeholders — customers, employees, investors, the society at large and the environment as well. In other words, profiting cannot be an “unconscious” activity but bear in mind all-round consequences.
“The Tatas for example, I would say, have done business with a purpose and they have actually contributed to our nation building. Mahindra and Mahindra, Marico, Cipla — though it got entangled in the patent issue — these names come immediately to my mind,” Sisodia told HT in an interview.
Sisodia links the recent global crisis to “unconscious” capitalism too focused on gains. “That was casino capitalism,” he said. “We need to have a change in culture to have a sustainable model.”
Massachusetts-based Sisodia, author of seven books on the theme, including Firms of Endearment: How World Class Companies Profit from Passion and Purpose, was in Delhi to address the Hindustan Times Leadership Summit.
The guru says incentives and fears driven by insecurity do not work any more in businesses.
“The carrot-and-stick model is all about incentives and fear and is driven by insecurity. That does not work. It should be based on trust, love and faith,” he said.
Sisodia, an engineer from BITS Pilani, is also an MBA from the Jamnalal Bajaj Institute of Marketing Studies in Mumbai and a PhD in marketing from the Columbia University.
Sisodia pleads for “not-just-for-profit” business models, socially responsible investing and caring leadership.
“Earlier, we had military-style leaders, leaders who have been bosses and CEOs who were generals. People were treated as assets and the means to make money, that was de-humanising,” he said.
“Now we have leaders who are connected and are willing to empower people,” he said.