Opinion

Bill Gates on Creative Capitalism

Bill Gates shares his vision for “creative capitalism” at the World Economic Forum in Davos this past week. His speech is 20 minutes long, but very worthwhile for people interested in what the leader of the world’s largest foundation is thinking.

Here are a few of his points I noted:

  • Bill is an optimist … he sites examples of how overall the world is getting better including improved rights for women, doubling of life expectancy in the past century, access to medicines and more … but he is an impatient optimist as there is a lot more than can be done
  • About 1 billion people live on < $1/day … most of these people don't get enough food/nutrition, clean water or have access to electricity
  • Market incentives enable benefits in inverse proportion to need … that is, the most less off benefit the most and the least well off benefit the least
  • He believes we need an innovation in the capitalist system … a new form of incentives for businesses to serve the 1/3 of humanity who benefits the least from capitalism
  • He calls this new endeavor, creative capitalism
  • Capitalism encourages self-interest … creative capitalism adds interest in caring for others … especially the poorest others
  • He proposal is that companies who engage in serving the poor should be given public recognition as their reward for these investments
  • He encourages companies to compete with each other to do the most good (in addition to making profits) and governments should create market incentives for this behavior
  • He challenges companies to contribute their “best minds” for innovation and their core expertises and not just their cash to these efforts

If you prefer reading a summary of what he talks about, here is Wall Street Journal article.

This idea is clearly aimed at big companies and government which is fine and good. I’m going to write more about social entrepreneurs as I believe they could even have a more significant long-term impact on bringing beneficial products and services to the poorest.

Do you agree with Bill Gates? Post a comment with your response.

3 thoughts on “Bill Gates on Creative Capitalism

  1. Dave,I really admire Mr. Gates’ optimism. I like what he said about capitalism addressing needs for those with income, but not for those without. I’m glad he recognized the need to connect third world companies with first world markets. Further, I’m not sure recognition is enough to make a large transnational corporation change their behavior. As a consumer, I frequently wonder about the so-called corporate social responsibility projects large corporations support. I’m sure they have the resources to lie to me. Could a third party verify the information, and attach a CSR report on the label like they do with nutrition information?Cheers,Liz

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  2. I think Gates is really wrestling with these issues but is dislike of Easterly worries me. His belief that technology is the central problem misses the mark. (At least this is what I got from the WSJ article.) Once again, like others, he fails to see the role social networks and institutions play in economic growth. He’s still learning. I hope he wakes up to the complexity of the issue.

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  3. I’m thrilled that Gates gave this speech, a sort of call-to-arms for the poor. Just a week ago I attended Muhammed Yunus’ speech here in Portland, Oregon, as part of his book tour. These two leaders have somewhat different views of social capitalism. Although I haven’t started Yunus new book yet, I know that he has proposed social businesses not take anything in profit beyond getting their money back. Gates, on the other hand, wants profit-making businesses to use some of their human and other resources to develop ways to bring the poor out of poverty.It’s good that there are different points of view on this broad topic. I think there will be businesses started that follow the Yunus model, and I think Gates’ call will motivate existing businesses to create socially-minded practices as part of their bottom line.I now work for a very large financial services company (Fiserv) and I am looking forward to seeing how we can do something to help.Thanks for the post, Dave, for the speech link and the summary!

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