Capitalism at the Crossroads

"Capitalism at the Crossroads is built on strong theoretical underpinnings and illustrated with many practical examples. The author offers a pioneering roadmap to responsible macroeconomics and corporate growth."
-Clayton Christensen, Professor of Business Administration, Harvard Business School and author of The Innovator's Dilemma

"I hope this book will be able to influence the thought processes of corporations and motivate them to adapt to forthcoming business realities for the sake of their own long-term existence. Besides business leaders, this is a thought-provoking book for the readers who are looking for solutions to capitalism's problems."
-Muhammad Yunus, Founder and Managing Director, Grameen Bank, Bangladesh and 2007 Nobel Peace Prize recipient

"Capitalism at the Crossroads is a practical manifesto for business in the twenty-first century. Professor Stuart L. Hart provides a succinct framework for managers to harmonize concerns for the planet with wealth creation and unambiguously demonstrates the connection between the two. This book represents a turning point in the debate about the emerging role and responsibility of business in society."
-C.K. Prahalad, Ross School of Business, University of Michigan, co-author of Competing for the Future and author of The Fortune at the Bottom of the Pyramid

"Stuart Hart was there at the beginning. Years ago when the term `sustainability' had not yet reached the business schools, Stuart Hart stood as a beacon glowing in the umbrage. It is clear commerce is the engine of change, design the first signal of human intention, and global capitalism is at the crossroads. Stuart Hart is there again; this time lighting up the intersection."
-William McDonough, University of Virginia, co-author of Cradle to Cradle

"Professor Hart is on the leading edge of making sustainability an understandable and useful framework for building business value. This book brings together much of his insights developed over the past decade. Through case studies and practical advice, he argues powerfully that unlimited opportunities for profitable business growth will flow to those companies that bring innovative technology and solutions to bear on some of the world's most intractable social and environmental problems."
-Chad Holliday, Chairman and CEO, DuPont

"Capitalism at the Crossroads clearly reveals the essence of what sustainability means to today's business world. Hart's analysis that businesses must increasingly adopt a business framework based on building sustainable value speaks to the entire sustainability movement's relevance. Sustainability is more than today's competitive edge; it is tomorrow's model for success."
-Don Pether, President and CEO, Dofasco Inc.

"Stuart Hart has written a book full of big insights painted with bold strokes. He may make you mad. He will certainly make you think."
-Jonathan Lash, President, The World Resources Institute

"A must-read for every CEO-and every MBA."
-John Elkington, Chairman, SustainAbility

"This book provides us with a vast array of innovative and practical ideas to accelerate the transformation to global sustainability and the role businesses and corporations will have to play therein. Stuart Hart manages to contribute in an essential way to the growing intellectual capital that addresses this topic. But, beyond that, the book will also prove to be a pioneer in the literature on corporate strategy by adding this new dimension to the current thinking."
-Jan Oosterveld, Professor, IESE Business School, Barcelona, Spain Member, Group Management Committee (Ret.), Royal Philips Electronics

"Capitalism at the Crossroads captures a disturbing and descriptive picture of the global condition. Dr. Hart constructs a compelling new corporate business model that simultaneously merges the metric of profitability along with societal value and environmental integrity. He challenges the corporate sector to take the lead and to invoke this change so that the benefits of capitalism can be shared with the entire human community worldwide."
-Mac Bridger, CEO of Tandus Group

"Stuart L. Hart makes a very important contribution to the understanding of how enterprise can help save the world's environment. Crucial reading."
-Hernando de Soto, President of The Institute for Liberty and Democracy and author of The Mystery of Capital

"Stuart Hart's insights into the business sense of sustainability come through compellingly in Capitalism at the Crossroads. Any businessperson interested in the long view will find resonance with his wise reasoning."
-Ray Anderson, Founder and Chairman, Interface, Inc.

"This stimulating book documents the central role that business will play in humanity's efforts to develop a sustainable global economy. Professor Hart presents an attractive vision of opportunity for those corporations that develop the new technologies, new business models, and new mental frames that are essential to a sustainable future."
-Jeffrey Lehman, Former President of Cornell University

"The people of the world are in desperate need of new ideas if global industrial development is ever to result in something other than the rich getting richer and the poor getting poorer, with nature (and potentially all of us) suffering the collateral damage. Few have contributed more to meeting this need over the past decade than Stuart Hart by helping to illuminate the potential role for business and new thinking in business strategy in the journey ahead. Capitalism at the Crossroads challenges, provokes, and no doubt will stimulate many debates-which is exactly what is needed."
-Peter Senge, Massachusetts Institute of Technology, Chairperson of the Society for Organizational Learning, and author of The Fifth Discipline: The Art and Practice of The Learning Organization

New Foreword by Al Gore
Brand-New Second Edition, Completely Revised with:


Up-to-the-minute trends and lessons learned
New and updated case studies
The latest corporate responses to climate change, energy, and terrorism


Global capitalism stands at a crossroads-facing terrorism, environmental destruction, and anti-globalization backlash. Today's global companies are at a crossroads, too-searching desperately for new sources of profitable growth. Stuart L. Hart's Capitalism at the Crossroads, Second Edition is about solving both of those problems at the same time.

It's about igniting new growth by creating sustainable products that solve urgent societal problems. It's about using new technology to deliver profitable solutions that reduce poverty and protect the environment. It's about becoming truly indigenous to all your markets, and avoiding the pitfalls of first-generation "greening" and "sustainability" strategies.

Hart has thoroughly revised this seminal book with new case studies, trends, and lessons learned-including the latest experiences of leaders like GE and Wal-Mart. You'll find new insights from the pioneering BoP Protocol initiative, in which multinationals are incubating new businesses in income-poor communities. You'll also discover creative new ways in which corporations are responding to global warming and terrorism. More than ever, this book points the way toward a capitalism that's more inclusive, more welcome, and far more successful-for both companies and communities, worldwide.



Paths to profitable sustainability: Lessons from GE and Wal-Mart
Shattering the "trade-off" myth
New commercial strategies for serving the "base of the pyramid"
What enterprises have learned about doing business in income-poor regions
Becoming indigenous-for real, for good
Codiscovering new opportunities, cocreating new businesses with the poor
Learning from leaders: 20+ new and updated case studies
Best practices from DuPont, HP, Unilever, SC Johnson, Tata, P&G, Cemex, and more


About the Author xii
Acknowledgments xiii
Foreword: Al Gore, Former Vice President of the U.S. xxiv
Foreword: Fisk Johnson, Chairman and CEO, S.C. Johnson & Son, Inc. xxvii
Prologue: Capitalism at the Crossroads xxxi

PART ONE: MAPPING THE TERRAIN
Chapter 1: From Obligation to Opportunity 3
Chapter 2: Worlds in Collision 31
Chapter 3: The Sustainable Value Portfolio 59

PART TWO: BEYOND GREENING
Chapter 4: Creative Destruction and Sustainability 87
Chapter 5: The Great Leap Downward 111
Chapter 6: Reaching the Base of the Pyramid 139

PART THREE: BECOMING INDIGENOUS
Chapter 7: Broadening the Corporate Bandwidth 169
Chapter 8: Developing Native Capability 193
Chapter 9: Toward a Sustainable Global Enterprise 223

Epilogue 249

Index 254