Creative Capitism
March 6, 2008 by markhsmith
Bill Gates at WEF 2008
Bill Gates talks about Halftime, the pause between his Life 1.0 (Microsoft) and Life 2.0 (Bill & Melinda Gates Foundation). He starts full time at Gates Foundation in July 2008.
His talk is the role of the Corporation in the World.
Some points:
The world is getting better, but it’s not getting better fast enough and it’s not getting better for everyone. There are a billion people that live on less than $1 day. Why do people benefit in inverse proportion to their need. Capitalism needs to be refined so that it benefits everyone. Capitalism harnesses self-interest in a for those that can pay, philanthropy benefits the poor who cannot pay.
Recognition is an added incentive to for-profit companies in lieu of payment–the market will reward companies that are recognized for doing good. This is creative capitalism. Profit for self-interest + recognition for corporate philanthropy = creative capitalism.
Examples:
- President Bush signed the Priority Review. For those drug companies that come up with a solution for a “forgotten” disease, will get a priority review. Getting their state-of-the-art drug first priority in the FDA approval process. This could be a $100M
- Get African coffee farmers the right market for their product.
- Bono’s Red campaign was born in Davos, which has generated $50M for Aids in Africa.
Bill Gates encouraged all corporation to use Creative Capitalism–give their top thinkers a percentage of their time & talent. He says this is better than cash, because it taps into the brain power. Glaxo-Smith Klien & Sumocomo are example. If companies in a sector simply matched what the leader in that
NGO’s can create measurable s to measure & recognize non-profit organizations. By recognizing non-profits, we can encourage the creative capitalism movement.
The largest companies can have the biggest impact. It’s engineering your product so that the product can reach the lowest 1/3 of the population. It has to be promoted by the CEO and become part of the DNA. When it becomes part of the DNA, it will drive itself within a company. “A computer for everyone.” Microsoft’s slogan drives innovation.
A company should stick to what it knows well. The company’s mission and philanthropy should be tied together.
The idea of NGO’s getting cash directly from corporations is not the best solution. NGO’s need to ask for innovation, something that goes with their core products & services. Also, NGO’s have traditionally suspected that for-profit companies need to do everything for free, when in fact, it’s OK for them to make money somehow in the process.
Bill Gates would like to see his legacy be: Within 15 years, I would like to see 15 diseases wiped out. Huge changes in the mortality rates, which changes the birth rate and makes education possible. We’re spending $3B/year.
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