What if its not cool to be a bad capitalist anymore?

If my last essay asked how we could incentivize companies to be better, the prevailing response from capitalists is that we shouldn’t.

“I don’t believe government regulation solves these problems,” Davis Smith, founder of Cotopaxi tells me. “I think there’s a role for it, especially in terms of protecting the earth—and that oftentimes is going to come from regulation—but in terms of businesses I think what we really need is a society that expects more out of businesses.”

This is a common refrain in business. Let the market regulate us. Let society regulate us. Get the government involved only if it’s absolutely necessary.

“The market demand will push us in the right direction, versus regulating it,” Smith says. “When we create a world where the best businesses are the most profitable, profitable businesses are the ones that are actually doing things right that people want to support and the ones that are the most destructive are really suffering. I believe you will have a better business and more profitable business by doing things the right way. And that wasn’t always the case, but I think it is today.”

In other words: We won’t work for companies that suck and we won’t buy from companies that suck, therefore companies that suck will have to get better or risk going out of business. It’s just not cool to be the rich capitalist driving a gas-guzzling Ferrari, with a company that pollutes the environment and employees who are overworked and underpaid anymore. Much better to be the Tesla-driving CEO on a mission to end poverty, who takes a pay cut so he can keep his employees during the pandemic even as he donates millions to charity each year.

 
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