Milton Friedman's "financial capitalism" business model, which focuses exclusively on maximizing returns to shareholders, has caused tremendous harm to people, planet, and even profits, argue Mars, Inc., executives Bruno Roche and Jay Jakub. They advocate a detailed, field-tested alternative that takes a broader view and enables businesses to do well while doing good.
For the past fifty years, the business world has been dominated by the Milton Friedman "financial capitalism" economic model, which preaches that it is the "sole social responsibility of business to maximize profit for distribution to shareholders." This one-dimensional focus represents a grossly incomplete view of reality-businesses need to pay attention to many other factors if they are to thrive and endure-and has resulted in increasing global economic dysfunction, widening inequality, and environmental destruction.
In this new book, Roche and Jakub offer a new model that is built around detailed metrics to measure and track performance in all forms of capital, including social, human, and natural, as well as financial. And this is not simply theory: the model has been extensively field-tested in live business pilots in Africa, Asia, and elsewhere. It is delivering superior measurable performance across the different forms of capital, including generating more profit than a profit maximization approach. Recent high-profile books like Capital in the Twenty-First Century have exposed the shortcomings of today's financial capitalism model, but this book goes far beyond by describing a well-developed, proven alternative.