Conscious capitalism: do good, build a business edge
Retailers that support the well-being of workers, suppliers and customers earn loyalty by making lives better.
Whole Foods Market practices what it calls "conscious capitalism.” Chain founder John Mackey’s co-authored book just came out about the concept, but it was co-CEO Walter Robb who shared specifics for a large audience at the National Retail Federation conference. On stage with him were CEO Howard Schultz of Starbucks and CEO Kip Tindell of The Container Store.
The three chains use their scale for good in the world, and succeed by creating new jobs, developing workforces, forming strong relationships with suppliers, and serving their communities.
This approach isn’t pollyan-ish. Robb, for one, calls it “a competitive strategy, because you step into more of what’s possible and you can truly realize your full potential as a business by embracing a wider circle of responsibility in the world.” He went on to say that retailers “restore humanity to business by the exchange that happens in our places of business.”
A few examples of “conscious capitalism” at Whole Foods:
- Hurricane Sandy brought home the sense of community. The chain’s 21+ New York-area stores brought in generators and “we were serving hot food to folks on the street, our customers,” said Robb, calling the experiences and stories from the storm-ravaged area “touching and profound to our customers and [people] who work in our company.”
- It extends to everyday buying and merchandising. “We think customers want more information and more transparency about what we’re offering,” notes Robb. “In fresh seafood, we created green-yellow-red [labels], and we stopped selling red [endangered species] on Earth Day 2012. When a customer comes to the case, they get a full shot of the standards. This is an example of where we provide leadership. We don’t have to wait. We can go ahead and set [our own] standards.”
- Employees share in the company’s success. According to Robb, 40% of Whole Foods’ 75,000 employees have an equity interest in the company. A celebration of 20 years on the NASDAQ exchange was an opportunity to feature a maintenance worker from a New Jersey store on the big street display.
- The chain helps suppliers grow. It loaned rancher Will Harris $500,000 at low interest to build a processing facility – and he now provides three regions with poultry and grass-fed beef.
- Its Whole Kids Foundation has so far placed 1,500 community gardens across the United States and 1,500 salad bars in schools. Its Whole Planet Foundation has made $200 million in micro-loans over seven years in 55 countries to support small entrepreneurs and help end poverty.
Tindell corroborated the rightness of retailers thinking of others: “You can put purpose alongside profits….Put the employee first. Take better care of her than anybody else, and she’ll take more care of the customer than anyone else.”