The bosses of the world’s biggest companies should each give a year’s salary to support social entrepreneurship and a better use of resources in the social sector during this time of economic crisis. This collective act of contrition and generosity would demonstrate their commitment to the well-being of society at a time when, with jobs cuts following hard on the heels of credit crunch, that commitment is being doubted perhaps more than ever before. It would also be a vehicle for helping to introduce to the social sector the sort of philanthrocapitalistic business thinking that we advocate in the book. As the demands on the social sector soar, whilst funding is under growing pressure, that thinking is urgently needed.
Matthew outlined this proposal in two articles this week, in the Huffington Post and the Times of London. He first raised the idea during the closing global agenda plenary session at the World Economic Forum in Davos, prompted by a discussion of what business should do to reduce the risk of a social backlash. The proposal provoked quite strong reactions, both for and against.
As we write in the book, there needs to be a new social contract between the rich and everyone else. A key part of this contract should be that those who get rich do so by just means, and that they have an obligation to give back, and to do so in ways that use their talents to achieve real impact.
As Bill Gates said in Davos, although there is a shortfall in giving due to cuts by some philanthropists (though not him) who have been hit by the crisis, that shortfall could easily be made good if those wealthy people and business leaders who do not currently give seriously were to start to do so.
Gates made his case by stressing the “carrot” that doing philanthropy is fun and fulfilling. But perhaps he should also wield the stick of the social contract. After all, Andrew Carnegie did so in the 19th Century, such as when he criticised people who failed to give their money away by the end of their life, saying “the man who dies thus rich dies discgraced.”