5 Reasons Why Conscious Business Beats CSR

When companies plan to contribute to the greater good, they like to refer to their Corporate Social Responsibility (CSR). When… They then point out that for them doing business is not just about increasing financial Key Performace Indicators (KPI) such as sales, profits, and returns, but also taking care of society and the environment – often times, however, they forget to mention that first the financial KPIs have to “allow it”. Because only then CSR can be afforded, and in general, CSR must financially be worth it.

The idea of modern Corporate Social Responsibility dates back to the last century: After the years of economic miracles, the first initiatives emerged in the 1970s, which called for consideration of the costs of economic action for the environment and society. By the 1990s at the latest, the CSR movement was gaining momentum, and companies began to publish a CSR report every year in addition to a financial report. Today, no respectable company can afford to be unconcerned about its continued responsibility towards people and the environment and to making a positive contribution to the development of the world. But can that really work with a CSR way of thinking?

Representatives of the Conscious Capitalism movement, for example, see CSR as critical. Managers and employees in a Conscious Business have to think and act differently: They place the environment, fellow human beings and all stakeholders at the center of all their actions and decisions. Only in this way is it possible to truly derive one’s actions from a responsibility to act, and not just an increase in financial KPIs. What does this mean for a company? Here are 5 key differences between a CSR oriented thinking and acting and the general thinking and acting in a Conscious Business:

  1. While from a CSR perspective, shareholders have to make a sacrifice for society, a Conscious Business involves naturally all stakeholders.
  2. While CSR is often seen as a burden, it goes without saying that a Conscious Business involves all potential synergies of doing business in ways that improve living conditions and at the same time contribute to the financial success of the company.
  3. While CSR is often added to a traditional business model (literally in its own department or as part of Public Relations), the core elements of a Conscious Business such as Higher Purpose and Stakeholder Integration are at the center of all action and an integral part of any department and position.
  4. While CSR can be independent of the purpose of the business as well as the corporate culture, a Conscious Business also requires a corresponding caring culture as well as a conscious form of leadership.
  5. While CSR can be used for the purpose of “green washing”, a Conscious Business requires an authentic commitment to its goals such as stakeholder integration, conscious culture, management and leadership as well as the pursuit of a higher purpose.

The Conscious Capitalism movement was inspired by the book of the same title by John Mackey (founder of Whole Foods Markets) and Raj Sisodia (professor at Babson College). It strictly puts humans into the center of doing business and calls for a consistent rethinking and acting in the sense of a future-oriented economy: Sustainable in the sense of protecting planet earth as well as future-proof in the financial sense for the enterprise. Ultimately, companies can provide the spaces and tools that allow each individual to make their positive contribution to the world. The Earth itself does not care how people behave on it – it already existed billions of years before humans and will continue to do so for an endless number of years to come. But humans can no longer care less about their actions. In this sense, Conscious Business is a logical next step after CSR to enable peaceful and healthy survival on our planet for many future generations to come.

P.S.: On Sept. 23rd 2019 the “2. Conscious Capitalism European Conference” is going to take place in Berlin. Among others John Mackey und Raj Sisodia will be present.

P.P.S.: All Master International Business Students at MBS visit a compulsory course in Conscious Business where we talk about the background, framework as well as many best practices in a future oriented conscious way of doing business.


Mackey, John and Raj Sisodia (2014): Conscious Capitalism – Liberating the Heroic Spirit of Business, Boston

MBS Prof. Dr. Christian Schmidkonz
About Prof. Dr. Christian Schmidkonz 43 Articles
Prof. Dr. Christian Schmidkonz is Academic Director of the International Business master's program at Munich Business School. His teaching and research focuses on Conscious Business, Happiness at Work, and Business in China and Taiwan. Christian Schmidkonz holds a degree in Economics from Ludwig-Maximilians-Universität in Munich. He studied Chinese at Fu Jen University in Taiwan and is an alumnus of the German Academic Exchange Service (DAAD). After holding positions at the ifo Institute for Economic Research and at the international management consultancy Capgemini, he won the "Multimedia" start-up competition organized by the German Federal Ministry of Economics and Technology as an entrepreneur in 2008. In 2020, Christian Schmidkonz was awarded the "MBS Teaching Award", which was presented for the first time.