The Philosophy of Hapitalist

By James TS Chua

In a recent article, Ms. Bee Ong explained how Hapitalist, a non-profit organization, came about. This week, we examine its philosophy and workings and some examples of businesses that already tend toward the Hapitalist vision.

Hapitalist, which aims to rehabilitate capitalism from “short-term profit at all costs” into a force that produces more positive outcomes for a greater proportion of humanity, has a distinct two-pronged vision.

Hapitalism “will make long-term thinking and responsibility an integral part of the profit motive,” Ms. Ong says.

Companies that currently operate on these principles, to varying degrees, include the Tata Group and  HealthCare Global Enterprises in India, and Lanxess, a German speciality chemicals group, the founder says.

“Throughout its long history, the Tatas have made major decisions with a long-range perspective, sometimes at the risk of shorter-term turbulence,” Ms. Ong explains, adding that the Tata Group “was established in 1868 to serve unmet needs in the community and has evolved into a profitable group of businesses.”

HealthCare Global Enterprises, headquartered in Bangalore, is headed by Dr Ajai Kumar who envisioned making the best cancer treatments “affordable and available to Indians who are neither wealthy nor live in the large cities.” Ms. Ong also notes that Dr. Kumar’s “business model, profit motive and entire decision-making process are powered by this vision.”

“These examples demonstrate that it is not impossible to be profitable while being responsible and far-sighted. However, such companies are relatively rare – too uncommon to benefit the mass of humanity, ” she says. Hence, Hapitalism seeks to “find practical, attractive ways to make long-term thinking and responsible decision-making an integral part of the profit motive and a common platform for all businesses” with an emphasis on ‘integral’ and ‘common platform’.

Ms. Ong concedes that there are many groups in the world trying to “build sustainability into business and the economy” especially in the areas of “climate change, accounting and corporate reporting.”

Yet, these disparate efforts have yet to create a significant impact on the world, because of “lack of interest from mainstream businesses and their supply chains… lack of coordination, lack of incentive to switch from the current system among other reasons.”

That is why as the second part of Hapitalist’s vision, the non-profit organisation endeavours to “facilitate the widespread adoption of such a way of doing business, enough to make an appreciable difference to humanity.”

That might sound like a tall order but Hapitalist will refer to “existing efforts and build upon their work with a central aim of incorporating long-term perspective and responsibility into business and economic decisions.”

“These models and methodologies are not new. We will be learning from the most effective ways and building upon their work,” Ms. Ong clarifies, adding that such efforts include “Accounting for Sustainability [started by the Prince of Wales in 2004], the Global Reporting Initiative, triple bottom  line, total cost accounting, socially responsible investing, social returns on investment, and gross national happiness” just to name a few.

Hapitalist also will draw on its “pure and applied research teams to discover models and methodologies needed to fill in significant gaps”. The research may delve into “non-mainstream disciplines, such as behavioral sciences, spiritual (non-religious) traditions, natural sciences and other seemingly unrelated areas.”

“The distilled wisdom will inform our original thinking , which will in turn inform the model-discovery process,” Ms. Ong says.

At the fundamental levels, Hapitalist is focused on “changing a system built on assumptions and mindsets that have proved to be inadequate for 21^st century circumstances.”

Ms. Ong observes that there are two dominant trends in economics today which may prove crucial to the success of Hapitalist’s mission.

“First, astute investors…and other keen observers note that the tide of influence started to shift to Asia, notably China and India, at the end of the last century, which is why we’ve decided to establish our base in Singapore, an Asian metropolis of multiple influences. Second, a new world is emerging from the current crisis. The 21^st century will need new ways of working, profiting, governing and living,” Ms. Ong says, pointing out that “we need to break away from past patterns that have not worked, including a Western-centric viewpoint and a silo approach to profit-making, business, economics, accountancy, and other relevant disciplines.”

Hence, Hapitalist will “engage the larger community of stakeholders in the global socioeconomic ecology” through “collaborations in research and implementation, conferences and other activities, and consultations with a wide variety of groups, of which the board of advisors is just a beginning”, and the non-profit organisation is prepared for the entire process to take several generations to unfold.

Yet, Ms. Ong is confident that Hapitalist “will find ways to bring them into mainstream practice.”

Hapitalist’s beneficiaries “will ultimately be all of humanity, regardless of culture, creed, race, educational level, geographical base and position in the social or organisational hierachy.”

This aptly sums up Hapitalist’s visionary approach to making businesses aware of their wide-ranging impact on the world, be it social, environmental or systemic. While Hapitalist thinks financial profits are indispensable, the organisation also sees certain trends making holistic profits a necessity in the future. For example, a FairPensions survey found that 55% of the UK’s 30 biggest pension funds, totalling about ₤351 billion, consider social, environmental and governance issues as essential considerations when selecting fund managers. The Responsible Pensions 2009 report observes:

…major UK pension funds are now acknowledging the potential of ‘non-financial’ issues to affect the value of investments, but many still lack key strategies to manage these risks.

Hapitalist may be going on the right track, after all.◊

The full report can be accessed at here.

James TS Chua is a freelance writer and an advocate for those who are living with disabilities.