Caux Round Table for Moral Capitalism
We make the case for Moral Capitalism.
The March edition of Pegasus is now available.
The issue discusses, among other things, how our Principles for Business came into being and the business leaders behind that effort.
This year marks the 25th anniversary of the founding of the Principles.
We would be most interested in your thoughts and feedback
Amazon’s emergence as a leading book publisher, as well as bookseller, is viewed as a threat to traditional publishing. At the same time, it presents an unprecedented opportunity, not just for budding writers of romance and mystery novels. It also offers non-profit organizations like the Caux Round Table for Moral Capitalism (CRT) a chance not only to publish books affordably but to promote ideas and reports to millions of Amazon customers.
Amazon is now the biggest seller of books in the world, bringing enormous pressure on traditional brick-and-mortar bookstores that face the challenge of finding ways to increase margins in order to survive. Some haven’t. And those that have are doing so by offering a host of products and services that go beyond book sales.
More recently, the online giant has mushroomed into the role of one of the leading book publishers. Since 2009, when it started publishing print, audio and e-books that can be read online or downloaded, Amazon’s list of publications has risen from 373 to more than 1200; each is produced by one of the company’s 15 imprints and promoted through Amazon apps like Kindle and First Read with monthly notification to a number of potential buyers that the traditional industry can only dream of – ten million customers in all.
Book publishing has traditionally been a low margin, high-risk enterprise in which publishing houses have accepted only a fraction of the manuscripts they receive from authors and agents. Despite this, many accepted books still fail to find an appreciable audience and publishing houses must often rely upon one or two best sellers each year to stay afloat.
But with Amazon, the margins are low and the cost of producing a book minimal when compared to traditional print costs with a high percentage – some 80 percent — of books in categories like romance self-published, meaning the company does not pay the author. The author finances the publishing of his or her manuscript.
This online revolution has created a backlash of criticism among traditional publishing houses. At the same time, Amazon’s low publishing cost, widespread promotion and ease of reader access has provided us the chance to reach a wider audience through self-publishing. Where once the only outlet for such organizations might be an academic press with limited runs and little money for promotion, now organizations like ours can potentially reach a much larger market with little cost. What’s more, once an e-book is published, it stays on Amazon’s list of books indefinitely, giving much greater weight to the ideas and opinions the organization wishes to promulgate.
And we are set to take advantage of this opening. At the moment, we have three e-books in the works, with more on the way.
“Amazon’s entry into publishing repeats the process of creative evolution improving humanity’s well-being which started with the first years of the industrial revolution and the birth of capitalism: enterprise takes a risk to introduce a new technology pioneered by science to change the ways in which we can live,” says Steve Young, Global Executive Director of the CRT.
“But as some Buddhists say, every gain comes with a loss,” he continues. “Those tied to old technologies lose out; their business models are no longer viable; their customers move on to new products and services.”
“For our non-profit enterprise, we see Amazon as an avenue to produce and distribute books at a cost we can afford,” Young says. “We have decided to join in the process of disruption to get good ideas and inspiration to more people all over the world.”
Here is the February edition of Pegasus.
You can read the table of contents by going to the Pegasus page.
We’d be most interested in your thoughts and feedback
This post is a request for your help and support.
As I look around our world with its achievements in improving living standards but its growing inequalities, antagonisms and rising mistrust of elites and others, I am reminded of David Livingstone’s last words:
“ALL I CAN ADD IN MY SOLITUDE, IS, MAY HEAVEN’S RICH BLESSING COME DOWN ON EVERY ONE, AMERICAN, ENGLISH, OR TURK, WHO WILL HELP TO HEAL THIS OPEN SORE OF THE WORLD”
Each of us has opportunities daily to help in healing; each of us can lead; each of us can make a difference.
I am grateful to all in our Caux Round Table for Moral Capitalism network for their contributions and their leaderships. We strive to contribute to the cause of healing and improving with ideas and recommendations – big picture and small bore – to put in the public domain for all to take up, improve upon and use in their many vocations.
During 2019, we plan to:
Your donations to our travel and organizational expenses are needed. Small donations can be particularly helpful:
You can donate here and a contribution form can be found here.
Anything you can give would be most appreciated.
John Bogle passed away recently. He understood financial markets, as we do, that they have a stewardship responsibility inside capitalism to support real wealth creation which raises the living standards of all fairly.
He opened financial markets for ordinary people – the arms and legs of capitalism – by making no-frills, low cost index funds easily available. He started a company, Vanguard Group, in 1975.
Vanguard’s business model allowed investors to minimize their risks by investing in a diversified portfolio of company stocks and so avoid the fees charged by fund managers who bought and sold individual stocks for their clients but who most often failed to outperform the market.
Vanguard was set up as a non-profit with its mutual funds and fund shareholders as owners of the business. Profits were plowed back into the business to reduce fees charged to buyers of its funds. Vanguard now manages $5 trillion globally. Vanguard has an expense ratio substantially lower than any other fund complex in the world.
Then, in 1977, Vanguard marketed its funds directly to individual investors and did not require them to go through brokers, who took fees for their service.
Bogle’s investment philosophy was to mimic the market, not try to outsmart other investors in the short run. Rather, his approach was to grow the market over time – little by little, but steady, year after year. This minimized the risk of loss which kept many with small or no fortunes from putting their assets at hazard in equity markets. Investors could obtain a market rate of return at lower cost with index funds. Even today, almost half of all American households don’t invest for the future at all.
Taken altogether, many Americans are richer and the financial industry poorer thanks to John Bogle. Warren Buffet said that John “did more for American investors … than any individual I’ve known.”
Bogle understood that it was the financial service industry that chased risk in order to get higher returns – greed for money. He saw Wall Street as “Financialism,” not honest capitalism. Bogle argued that financial advisors had a duty to be good stewards of the best interests of their clients only.
Bogle’s strategy was encouraged by federal government tax policies in the authorization of IRAs (individual retirement accounts) and 401(k) savings plans. These two arrangements allowed investors to defer the payment of taxes on their earnings in such funds. Index funds are now just under 30% of the stock market.
He received me graciously in December 2012. He had liked what I had written in my book Moral Capitalism – ”Moral Responsibility is a form of stewardship, of agency, of fiduciary undertaking. … it is a vision of mutuality, of service, of both self and others.”
In giving me a copy of his book The Clash of Cultures, he signed it with this word of encouragement: “Press on – Regardless!”
John differentiated between investment and speculation. The first was good use of money and the second was just gambling to make a money play off the misjudgment of others about the odds of future contingencies happening or not. He understood that speculation did not necessarily create new wealth; it just moved money around from some to others, as happens in any poker game.
Bogle called his industry “The poster-boy for one of the most baneful chapters in the modern history of capitalism.”
Another one of his books, which I have, is just called Enough.
We’ve just released our annual report, the 2018 Year In Review. We had a productive year last year. We’re looking forward to a very productive 2019.
I returned home yesterday from a stimulating conference in Zhengzhou, China, discussing Chinese contributions today to a “community of shared future for mankind.” The gathering of scholars was the 10th International Symposium on Chinese Culture in the 21st Century. Opening the sessions was Mr. Wang Zhengwei, Vice-Chairman of the Chinese People’s Political Consultative Conference and a member of the 16th and 17th Central Committees of the Communist Party of China.
Zhengzhou is in the center of north China, along the Yellow River in Henan Province. Henan is the birthplace of Chinese civilization several millennia ago. The topic for discussion at the forum was how to apply to our world today perspectives from China’s ancient Yan Huang philosophies on human destiny, ideas which arose among peoples and kingdoms living in and around Henan.
My paper was an exploration of the over-looked essay in the Confucian tradition entitled The Doctrine of the Mean, which links Confucian social ethics to a never-ending cosmic dynamic of the Tao. Briefly, the Doctrine of the Mean advises that individuals must discipline their minds and hearts to find balance and equilibrium between the authority of absolutes and the realities of pluralism. Finding the Mean permits living in the Tao, which is sustainability and wholesomeness.
Delivered today to my home in St. Paul, Minnesota, the Wall Street Journal has two commentaries on the West – Europe and the U.S. – falling short of the Mean in their culture, economics and politics.
First, Willam McGurn writes on U.K. Prime Minister Theresa May having inadequate support for her plan to have her nation leave the European Union but maintain some advantages of association with that larger international confederation. The future of the U.K. is now up for grabs. He then notes that in France, President Emmanuel Macon has just retreated in concession to protests against his elitism by offering the “masses” a higher minimum wage and cuts in taxes on some pensioners. Thirdly, McGurn reports that in California, 200 civil rights leaders have gone to court to oppose the state’s greenhouse gas emissions regulations as discriminating against poor African Americans and Hispanics to favor the preferences of the very rich, who live in Hollywood and Silicon Valley.
Secondly, Walter Russell Mead opines that voter distemper in the U.K., France, Germany, Italy and the U.S. is happening when those economies are doing rather well. What is driving protest is therefore not simply economic discontent. The storm of populist angst has other causes. Our time is out of joint. Something is upset in how we are governed, in our levels of self-respect, in our expectations of the future and in the answer to the question of “Cui Bono?”
The ideas of the Caux Round Table of Moral Capitalism seek to provide such balance for the economy, public governance, civil society and the ownership of wealth.
Today’s Wall Street Journal also brought forth in a book review a most relevant piece of advice from Samuel Williams from his 1794 book History of Vermont: “Behold here the precarious foundation upon which ye hold your liberties. They rest not upon things written upon paper … they depend upon yourselves; upon your maintaining your property, your knowledge and your virtue.”
Confucius could not have said it better.
This Thursday, November 15th, is Give to the Max Day here in Minnesota, where the Caux Round Table for Moral Capitalism (CRT) is based, and I write to ask for your support.
We are very efficient in punching globally way above our weight for a small, non-profit and as proof, in 2018, we:
-Held our 2018 Global Dialogue at St. Petersburg University’s Graduate School of Management in St. Petersburg, Russia on the current growing tension between humanism and tribalism.
-Convened a workshop in Kyoto, Japan on mutuality in ethics between Japanese and Chinese moral traditions, integrating the insights of two great East Asian peoples for collaboration in support of global sustainability.
-Cosponsored a workshop in Beijing on the jurisprudence of an ancient Chinese statesman, MoZi, and on the contemporary usefulness of the ancient Chinese text, the Yi Jing as guideposts for the constructive integration of the official Chinese approach to government and markets with global standards.
-Initiated organization of a 2019 workshop at the Vatican on the Covenants of the Prophet Muhammad with Christian communities as appropriate contemporary social teachings on respect and collaboration between Christians and Muslims for the common good of humankind.
-Cosponsored a conference in Bangkok on Buddhism and sustainability.
-Commissioned a unique, pioneering study of enterprise valuation methodology with Oxford Analytica.
-Initiated a new CRT book series with the publication on Amazon Kindle of collected essays on ethics.
– Convened two public office/public trust workshops for political candidates and elected officials on the CRT’s Principles for Government.
-Held the 10th annual Celebration of John Brandl & His Uncommon Quest for Common Ground in partnership with several local policy organizations.
-Held several round table discussions on relevant and timely topics.
-Published 12 monthly issues of our newsletter Pegasus.
We need your help now to continue this work and more importantly, to expand it. With your help, we can reach out to more countries, convene more workshops of thought-leaders, publish more books, train more people, create more unique management guidelines and metrics for sustainability, help implement the U.N. Sustainable Development Goals and showcase practical steps towards robust outcomes advancing the common good.
Anything you can give would be most appreciated.
To help the Caux Round Table for Moral Capitalism advocate its Principles for Business, publications are a basic tool for the dissemination of our ideas and practical ways to implement them.
We have been fortunate to have published Moral Capitalism (2004) and The Road to Moral Capitalism (2014). We have now published our monthly newsletter Pegasus for 7 1/2 years.
This week, we are delighted to announce a new publishing format: e-book and print-on-demand on Amazon.
We find that there are many important and thoughtful contributions to new ways of thinking about capitalism which fit neither academic publishers or peer-reviewed journals, nor commercial houses. Thus, we want to fill a void with our own use of new technology of digital and print-on-demand and bring to public consideration worthy ideas and recommendations.
We have just posted on Amazon for downloading on Kindle an e-book: Ethics – Collected Works.
You may purchase the book here.
If you purchase the book and enjoy it, I would be very grateful if you left a review on Amazon. Reviews really do help give the book better visibility for those searching on Amazon for books on these subjects.
I am grateful for the assistance of my colleagues Erik Sande and Patrick Rhone in making the essays included in this book available to the global public.
Please forward this email to those whom you think might want to consider reading these essays on moral capitalism.
We have two additional collections of essays we will be publishing in the coming months.
In addition, we now want to reach out and provide publication for commentaries, essays and manuscripts which fall between the stools of academic presses and journals and commercial houses. Please get in touch with me if you have thoughts and comments you would like us to consider for publication under our brand.
Our Wittenberg Statement reflects the concerns of participants at our 2017 Global Dialogue held last November in Wittenberg, Germany.
Observations of fundamental importance deserve to be memorialized in a statement. The 500th anniversary of an event in Wittenberg which, under the influence of dynamic circumstances, triggered the Protestant Reformation, was an occasion to reflect on the emergence of modern civilization with its structures of science, industrial production, private finance, nation states and international law and ideals of constitutional rule and human rights.
But, as participants noted in the Statement, the emergence of a social, economic or political system does not make it wise, just or perfect. Systems have advantages, to be sure; they meet needs and provide goods and services. But they have limitations and short-comings which only new human endeavors can correct or remediate.
Nonetheless, as reforms and innovations are advocated and adopted, there are still timeless aspects to our endeavors which seem beyond the reach of intentional modification. Reflection on Martin Luther after 500 years helps us spot what is lasting and what is only interim.
The morality of our contemporary capitalism stands on both timeless needs of human nature and incremental, short-term improvements to our structures for creating wealth and distributing it.
The Statement hopefully will serve to define a greater common understanding of what is fundamental and what needs to be addressed in our time through our ideals and efforts.