Rebecca Henderson is a renowned Harvard professor who debunks prevailing norms with a new outlook and a practical way forward. She believes this way of thinking is an antidote for a system that has lost its moral and ethical foundation. Her arguments, as she teaches the MBA program at Harvard Business School, are a clarion call for reimagining and remaking capitalism. Beri Meric, cofounder of IVY, asked her about the role of capitalism.
What has been great about capitalism so far?
Capitalism is probably the greatest invention of the human race. If you think about what’s happened in the last 50 years, the population of the earth has approximately tripled, and GDP has quintupled. So, simultaneously, as we’ve got more and more mouths to feed, we’ve generated more and more prosperity. The turn to capitalism in China brought a billion people out of poverty in the last 20 years.
What are the shortcomings, and how can capitalism be improved?
Inequality is a big issue. We’ve generated enormous prosperity across the world, but in many countries, particularly the United States and the UK, that prosperity has not been widely shared. So, there’s a significant fraction of the population that hasn’t seen a real increase in their standard of living for the last 20 years.
And many people are losing hope.
Where do the new opportunities lie?
Reach out to other people in your industry and ask, “Are there problems we can address together that will make us all better off? And can we join together to do that?” That could mean addressing human rights abuses if you’re a mining company, or committing to purchase sustainable palm oil if you’re a consumer goods company. We’re seeing these kinds of coalitions spring up across all sorts of industries. They’re good for everyone in the industry, and no one is at a disadvantage by participating.
There are billion-dollar business models on the other side, but you need to have the courage and the focus to go and get them.