Perhaps an old concept for many of us, this article in the Harvard Business Review, “Shared Values” by Michael E. Porter and Mark R. Kramer may be a defining moment in the transformation of thinking about capitalism.

The social innovators in the world know and understand that that the economy versus environment paradigm is dead. We inherently embrace that within a ‘collective interest’ framework exists the ‘self-interest’ needed to sustain a living. We see the potential of making a living by doing good. We also know that the very best social innovations emerge out of community, aka… knowing ones customer.

But how exciting to see this conversation beginning at a strategic management in business level. What a vision Porter and Kramer cast to imagine that corporations might see their profits inherently reliant on the wellbeing of a community, the sustainability of a resource or the economic viability of their customers. This could mark an important moment in our history as a capitalist society.

Two thoughts occurred to me while reading the article.

First, I was reminded of David Korten‘s work on building Living Economies. When he visited CSI years ago, hosted by Green Enterprise Toronto, he spoke to us about a world where ‘shareholders were connected to the means of production’. He spoke about the problem with capitalism being that shareholders were completely disconnected from the concrete decisions that were being made on the ground in a particular company. How does a pension-fund holder make a decision about which forest to log? It feeds perfectly into Porter and Kramer’s article here… how can we assess our shared values if we aren’t connected to the decisions that we are making?

Korten’s remedy was to re-engage small business, local business and to ensure that our financial systems support investment where those investors are connected to the means of production. This thinking has been pivotal in crafting my own brain around things like the Community Bonds.

Secondly, this article and the subsequent comments captured a transformation from ‘value chain’ to ‘value ecosystem’. This is brilliant and rings true in so many places. It is the first time that I have heard of this concept… perhaps lots of people are thinking about this, but for me it speaks to the transformation from linear to complex. It speaks the embodiment of networks and the cooperative economy into reality. It is E-Bay meets Walmart meets community gardens. Very cool.

Shared Values and the concepts therein is important not because it is new (it isn’t), but because people are talking about it. Important people. And they are grasping with how to support this thinking into reality. It is driven by the ambitious MBA’s that want to change the world. It is built upon an interconnected world where information flies at the speed of light. It is also the only hope that we have that we might transform corporate culture to actually be engaged in the true value creation process – the one where we make the whole world a healthier and more sustainable place to live.