Heroic Interview: Conscious Capitalism with John Mackey

You're listening to Conscious Capitalism an Optimal Living interview with John Mackey and Brian Johnson. Hi, this is Brian. Welcome back to Optimal Living 101. Today I am so excited to be chatting with John Mackey, the co founder and co CEO of Whole Foods, who has been one of my deepest inspirations in business and in life. John, thank you so much for taking the time to chat today.

Great to be here, Brian, thanks for having me on.

Well, so I want to start by talking about free markets and why they're so powerful. Then talk about conscious capitalism and then talk about conscious leadership and what we can do to become conscious leaders. But let's start with free markets. Why are they so powerful? And then also why are they so demonized?

Well, they're so powerful because when you have free markets and people get the freedom to choose, then you end up that allows entrepreneurs to innovate and create new products and services. It allows competition to occur. And it means that the best ideas will be, will ultimately kind of win out in terms of the value creation for people. Without that, you end up having, people don't have as much choice. You don't have the kind of innovation that you have and you don't have the same kind of progress. Because any kind of free system, free market system, you'll have success, but you'll also have some failure. The marketplace will reject the ideas and the goods and services that don't really provide the value that, that people are looking for in a sustainable fashion. So it's how our society progress progresses really and will progress a lot faster as we allow free markets to generally exist.

Fantastic. And then we want to hear your thoughts on kind of why has free market capitalism gotten a bad reputation? What's the essence behind that?

I think it's because. Well, first of all, you have to understand that business has always been hated by the intellectuals. Throughout all of history, business has always been demonized. You can go back and study your history and you'll see that trade and commerce was always seen as sort of lower class. There's a bunch of greedy people out there and oftentimes you had minority groups that were the ones allowed to engage in trade. And so in the west you had the Jews, and then in the east you had the Chinese and in both cases those whatever you had the Jews all through Europe and the Chinese were all through Asia. They were very successful in their businesses. And that oftentimes created envy and resentment. And so I think the Jews were persecuted and run out of country after country and their wealth would be Confiscated. Well, the same thing happened to the Chinese in the East. So the intellectuals have always hated business and the aristocratic elites have always disliked business as well. And so the first thing to recognize, it's always been that way. And, and today, when capitalism was invented a couple hundred years ago and we saw this tremendous progress occur in the world, it's been phenomenal how much progress we've made. I mean, some of the statistics we discovered in writing our book was 85% of the people alive on the planet 200 years ago lived on less than a dollar a day. Think about that. 85%. Today it's down to 16%. 200 years ago, illiteracy rates across the planet were over 90%. Today they're down to 14%. The average lifesp 200 years ago was only 30. Today, across the planet, 68. 78 in the United States, 82 in Japan. So humanity's made great progress in the last 200 years due to, due to capitalism, due to business. And yet, of course, business and capitalism don't get credit for it. Most people are not historically well informed. Instead they get demonized and they get blamed for all the problems that exist, that inequality or environmental challenges or. Business is judged by its worst practitioners. So the companies out there, like a WorldCom or Enron or Bernie Madoff, they get the headlines. In another profession. If a doctor takes out their own kidney, they're not going to be in the front page of news doctor takes their wrong kidney. So business is judged by its worst practitioners. And we know from Gallup, for example, the Gallup poll shows that big businesses approval rating in the United States is only about 19%. That means 81% of people don't approve of big business. And I think it's because if you ask why, there's lots of reasons why. I've pointed out the intellectuals have never liked commerce and they've always envied and resented the fact that business people can make a lot of money and become rich and wealthy. And they don't like that. It creates a sense of unfairness about the whole thing. And secondly, I think business has done a very poor job of defending itself intellectually. Oftentimes agreed with the critics that it's about profit, it's about, it is selfish, it's greedy, but through Adam Smith's invisible hand, that all works for the good of society. And so in a sense, we've written our book Conscious Capitalism to put forth a different ethical narrative about what business and capitalism are about. The business has the potential to have a higher Purpose. It's not primarily just about making money. That's very much a secondary thing.

Yeah. Remember getting into your work when you were debating Milton Friedman, however long ago that was, to now with conscious capitalism. So describe to us your vision of conscious capitalism and how that differentiates from perhaps the kind of normal take on capitalism.

Well, conscious capitalism has four basic tenets to it. The first tenet we've sort of just talked a little bit about. Business has the potential for higher purpose besides just making money. I mean, think about it. Doctors make money. They're some of the highest paid people in our society. But that's not the purpose of a doctor. The purpose of a doctor is to heal people. Teachers, educate architects, design buildings, engineers, construct things. Every one of the professions in our society refers back to some type of value creation in the world. Well, so does business. Business is actually the greatest value creator in the world. Business creates value for everyone it trades with. It creates value for customers who do so voluntarily. It provides goods and services for people. It creates value for employees who provides jobs. It provides wages. It provides benefits. It provides opportunities, hopefully to be to advance and to progress. It provides value for suppliers who trade with it. No one has to trade with the business. They do so because it's in their interest to do so. And that creates great value for like a company like Whole Foods Market has literally tens of thousands of suppliers and they're trading with us and they're flourishing as a result of that trading. And then you have your investors as the profits of the business. If it's successful, that money gets paid out to the investors through dividends and through a public company like Whole Foods Market, stock price will go up and people can sell their stock. And it creates value for communities primarily because of all the other stakeholders. But oftentimes, businesses consciously are philanthropic and they attempt to be good citizens in their communities. So business is the greatest value creator in the world, and that's its higher purpose. That's why it exists. And secondly, conscious capitalism is about doing this in a conscious way, creating value for all of these stakeholders which are interdependent on one another. That at Whole Foods we hire the very best people we can find, we make sure they're well trained, and then we help them to be happy in their jobs. Happy team members result in happy customers, and happy customers result in happy investors. So the conscious capitalistic business recognizes this interdependency that you have to manage the whole system and does so in a way that all the stakeholders are winning. Everyone's benefiting thirdly, we need a different kind of leadership. The book outlines a type of leadership that has a higher degree of emotional and spiritual intelligence and also is a servant leadership that serves the business, serves the purpose, serves the stakeholders. Fourthly, you have to create a humanistic empowered culture that allows the people in the organization to self actualize themselves and reach their highest potentials. Those four things are the basis of conscious capitalism, higher purpose, stakeholder integration, conscious leadership and empowered cultures.

Robin, there's so much we can talk about with all these ideas. Given the time constraints and the fact that I want to talk to you about some of the leadership concepts, I'm going to move on to one of the ways. When we first met, however many years ago, it was with the Victor Frankl concept that happiness must ensue. I'd love for you to talk briefly about purpose and how purpose, I'm sorry, purpose and profits and how profits are really a byproduct of pursuing purpose. Can you talk about that?

Yes, we do. Well, we like Frankel in the book and I oftentimes get people to understand this through the analogy of happiness. That happiness is if you make happiness the primary goal in your life, you probably will not achieve it or you'll sub optimize it. And that's because profit is a byproduct. I mean happiness is a byproduct of having purpose, having friends, having family, contributing to the well being of others, being a good citizen in our communities, helping, you know, self actualizing ourselves, reaching our highest potential, spiritual growth, that type of thing. Those things, when we pursue those things, happiness is a byproduct. If we make happiness our primary goal, probably end up being some kind of narcissist and we will find that we really aren't very happy. It's the paradox of happiness. Well, the paradox of profits is similarly if you make that your primary goal, you probably will suboptimize because you will not be fulfilling any type of higher purpose in your business. You won't probably have a stakeholder orientation and you'll just be trying to make your go for short term profits and you'll end up might achieve that for a while, but in the long run you will probably your business will not be that competitively robust when it comes up against a business like Whole Foods Market that's driven by higher purpose, it's much harder to compete against. So profits are a byproduct of purpose. And that, I mean it's a lot more than just that. You can have a higher purpose and not be successful. As a business person. But I think the main point is we shouldn't make profits the primary goal. They should be something that comes as the end product or secondary result of taking care of customers, creating value for customers and creating value in the world. And, and that profits will be the reward for doing that.

Well, can you tell us a little bit about your journey in discovering and articulating Whole Foods purpose? You talk about the good, the true, the beautiful, and the heroic most recently. Can you talk about that? And then also we'd love to help anyone who's listening kind of entrepreneurially at different stages of their development of their business, how they can discover their most authentic purpose.

Well, Whole Foods purpose evolved. Our higher purpose has evolved over time. It's still evolving. And when we started the business, it was really, we just wanted to sell healthy food to people, earn a living and have some fun. And we're still doing all those things. But as we've gotten larger and as time has passed, our higher purposes have gotten more complex. And we now identify at least four higher purposes. That one is, we want to help restore the health of America. I mean, Americans are now staggering. 69% of adult Americans are overweight. 36% are obese. More than a third of all adults are now obese in America. And 80% of what we spend on healthcare dollars are for diseases that are primarily dietary and lifestyle related. Stroke, heart disease, disease, type 2 diabetes, autoimmune diseases, and even cancer correlate very closely to diet and lifestyle. So there's not going to be a vaccination for cancer and there's not going to be a pill you can take that's going to reverse heart disease. These are things we're doing to ourselves primarily. And we'll have to change our diets and change our lifestyles if we want to optimize our health. So Whole Foods is all about that. Secondly, we're interested in sustainable agriculture. We think that we need to have a highly productive agricultural system that is also, at the same sense, sustainable. We do this in a lot of ways. Sustainable seafoods hopefully just gotten big into that. Organic agriculture, obviously, animal welfare practices are also something that we think is very important from an environmental standpoint. So thirdly, through our Whole Planet foundation, we're working to eliminate poverty on the planet. We know we've positively impacted a million and a half people in the last eight years through this program. It's amazing. We're in 55 countries and these are little tiny microcredit loans. You know, average loan is a couple Hundred dollars. It goes to very poor entrepreneurs, mostly women, 93% women. And it's amazing. And as we've gotten deeper into it, we realize, wow, this is part of who we are as a part of what we're about. And. So anyway, those are some of the higher purposes of Whole Foods. And it's continuing to evolve and we're continuing to. I don't think there's a limit to it. I think is that we're right now working on trying to synthesize our higher purposes, in a sense, into a highest purpose that we can easily articulate to people. I just spent five minutes doing it. I would like to do it in a sentence or two.

Yep. And then do you have any wisdom for people who are exploring how to articulate and embody their purpose?

Are there ways for people to try it? Again?

If I'm an entrepreneur, whether I'm a coach or a yoga teacher or starting a new business or running a business of any size, any wisdom you'd offer to help us articulate our purpose?

You mean to discover what the purpose is or. Well, to discover your purpose. We oftentimes say you have to do a future search. Now, as an individual, I'd give different advice than I would for an individual. Then I'll talk about organization. Perfect for an individual. The way to discover your higher purpose, in my opinion, is to follow your heart. That your purpose is something that's already within you. It's already within your higher self, already is, knows what your higher purpose is. And you won't discover it if you don't have the courage to basically follow your heart. And we are following our heart when we are able to hear our inner guidance and have the courage to follow it. Most people don't discover their higher purpose because they are too afraid to follow their hearts. Because afraid people won't like them or that they will be rejected by their parents, or they may not be able to make any money, or that they'll fail or they'll be ridiculed, or that some type of fear causes people to compromise on their own following their heart, as people follow their hearts, then your own higher purpose is revealed to you and you begin to be able to understand it and articulate it. That is the way it's been for me, and it's also been the way for many other people that I'm close to that have discovered their own inner higher purposes, because I think it's within our own being. So it's. You find it as you are true to yourself and you have to have the courage to overcome fear in order to be true to yourself. Follow your heart. And that leads to hyper. Follow your heart, discover your higher purpose. That's my tip for our suggestion for individuals. Now for organizations, you have to understand that organization have many different stakeholders in them. You've got your customers, you've got your employees, you've got your suppliers, you've got your investors, and you've got your communities that you're part of. And I think the way an organization discovers its higher purpose, now, unless it's the entrepreneur creating in the first place who's on fire with a sense of higher purpose. So in that case, the entrepreneur, him or herself will articulate the original higher purpose of the business because they created it consciously with higher purpose in mind from the very beginning. So that's the easiest way and hopefully for talking to young people that they'll go out and create conscious businesses with higher purpose right from the get go. But let's say you're an older organization and you. You've basically just been pursuing a profit model and now you're trying to discover what your higher purpose is. In that case, you need to bring all this stakeholders together in a retreat like setting your customers, employees, suppliers, investors, members of communities. I recommend bringing an outside facilitator in. And then basically what is the collective dream of the organization and every one of the stakeholders will have? They're like seeing different parts of the elephant. They will see a different part of the elephant. But then as you begin to articulate collectively the different visions that each of the stakeholders have, you will begin to see common thread that run with all of the stakeholders that you're able to synthesize together or sew together into a coherent, meaningful purpose that will resonate deeply with all of those stakeholders. So you create a shared purpose and you do that, a shared higher purpose. You do that by having the whole system in the room together or at least representatives of the whole system.

Yep, very cool. Let's move into more of the individual focus. And you already talked about some of the things that I had in my notes to discuss, following our hearts and what that means, and then also the courage required. And you talk about in the book some great stuff about having courage and moving through fear and really the importance of learning how to deal with fear. Can you talk to us more about that and how fear gets in the way and ways that we can cultivate our courage? I will.

Fear was my. Everybody has their own thing they most have to struggle with in their own evolution. Personal growth. And evolution. In my case, fear was by far the biggest. You could say enemy or you could also say ally, depending on your perspective. But definitely something that I had to master to wake up and become who I am today. I found that what worked well for me is, and it took me a long time to get this, so I'm going to try to articulate it. And it may resonate with some people, it may not resonate with others, but what I discovered was, is that fear really doesn't exist in the moment. Fear is always a thought. It's a thought in the mind. And our series of thoughts in the mind in case of anxiety, that something bad is going to happen in the future. It might be the future in a few seconds, or it might be down the road, or might be years from now. But we have this fear that something bad is going to happen. And once you realize that fear itself doesn't actually exist in the moment, in the moment, there is not fear in the moment. There's only the. There might be even a horrible thing happening in the moment, but it's seldom as horrible as it seems to be if you can really be in the moment with it. Obviously people can say, well, if I was getting eaten by a shark, that would be pretty horrible in the moment and I'd be scared in the future. Yes, there are exceptions to this rule, but that doesn't necessarily negate the overall thesis, which is 99.99% of the time in the moment, there really is no fear. The fear is always about the future. In the moment, there's nothing to be afraid of. So what I learned in overcoming fear was to focus my attention in the moment and just be in the moment with it and then make the appropriate response in the moment. And let's say you're up in a high place and you have a fear of heights. So I learned this, like when I'd be hiking up in the mountains and I'd be like on a knife's edge, where it's like either side of me. If I was to slip and fall, I would die. I'd fall off that knife's edge and I would die. Well, as long as I focus on that, I'm going to become very afraid and possibly create a higher probability that I will fall because I am no longer in the moment. I'm all about what could be go wrong, what bad might befall me. And as a result, I'm somewhat paralyzed. I'm not no longer confident. I'm no longer steady on my feet. Now I really Am in risk, I really am in danger. And the way out of that trap is to take that fear that you're experiencing, which creates energy and use it to concentrate on more intense in the moment of being and moving in a way that is direct and purposeful and confident. And you just will move right off that knife's edge and nothing will happen. And that metaphor is appropriate in almost any situation where you're afraid. If you feel the fear, fear creates energy. Use the energy to intensify your concentration and go back in the moment. In the moment there is no fear and you will move past it.

That's awesome. And be willing to take that action and just be present. And this ties to me with another one of your ideas. It's really been impactful for me, kind of extending fear to overall creativity. And this idea that you articulated as ready, fire, aim. So I know in my past I used to ready, aim, aim, aim. When I'm perfect, then I'll be ready to, to get to market. Right. So this is something I share a lot in my teaching now is this idea of ready, fire, aim. Can you talk about that and how that's important?

Well, I like to say. Fire, ready, aim.

Even better.

Yeah. Because the idea being that the key concept they're buying is that it's okay to make mistakes most of the time. I mean, it depends. Obviously there are certain circumstances that are so critical that you cannot do a fire, ready, aim. I want my pilots on my airplanes to go through their checklist and so I want them to be careful. But most of the time in life we're not in a life critical situation. In that case, it's better just to move forward and experiment, try things. Because it's okay if you make a mistake. Mistake is just a feedback opportunity for you to correct, correct course correction. And then I always say fire, ready, aim. But also learn quickly. And that's sometimes hard for people because some people cannot admit they make a mistake. It's too threatening to their self esteem. So they are completely in denial that they ever do anything wrong. I don't have any problem admitting I make mistakes. So I make them all the time. And I don't think it's any big deal. It's like I made a mistake, can do something different next time and do something different immediately in many cases. So I just feel like that's if you try things, then you will learn quicker. So I know in business, for example, that Whole Foods is very experimental and we're very decentralized, so we allow lots of different Experiments to. To go on in our stores all the time. Most of them don't work. I mean, they don't succeed. And the ones that do succeed, we tend to copy, replicate and improve on. And the ones that fail, we eliminate. And so we're quick learners in that regard. So anyway, that's how I see that.

Oh, that's great. So being willing to make mistakes, experiment with life. As you know, we named our son Emerson, and one of his thoughts of all life is an experiment. The more experiments, the better. It's been something we've been really engaging in and just, you know, what psychologists call a growth mindset, right. Where we're constantly looking to learn and grow and just love the way you articulate that and so appreciate it. Again, there's so much we can talk about with that, but I want to make sure we talk about a few other things. Integrity. Integrity is a big concept. As you talk about servant leadership, can you talk to us about integrity? What it is, why it's so important.

How we cultivate it, Talk about integrity. Integrity is, in a lot of ways one of the master virtues. I mean, it's right up there, in my opinion, with love as one of the highest virtues. And generally, people, by integrity, they think integrity means honesty. And it certainly does mean that. And part of having integrity is being honest. But it also, I think it's a bigger word than just honesty. It's not a synonym. Integrity includes honesty, but it also includes. It includes authenticity, something that is in short supply oftentimes in our world today, we have so much spin going on, whether it be marketing spin or political spin or journalistic spin, media spin. But a person with integrity shows up authentically, meaning they're true to their selves, they're true to their emotions, they're true to their beliefs. So there's an authenticity with a person with integrity. There's a trustworthiness that, in a sense, we tend to trust people that have integrity. And people that have integrity put forth kind of a feeling, tone that they are trustworthy, and we sense that within them. So there's authenticity, there's honesty. There's also what I call ethical courage to do what is right. The person with integrity will not back away from doing the right thing, even though there might be a personal cost involved to it. I mean, I experience this all the time, and oftentimes where I get people angry at me because I show up authentically and I say things they don't want me to say or they disagree with, personally attacked. And of course, you just shouldn't do that to be unnecessarily provocative, I don't think. But sometimes you need to show up authentically and you need to have the ethical courage to do the right thing, even though you know it's going to make people upset with you and, you know, you may not be liked and there may be negative repercussions to you. I think integrity involves doing what you believe to be the right thing and having the courage to do it. So I think all of those elements make up kind of this master virtue, Integrity, love it.

And then you mentioned love. So love and care is a big theme of the book. And you know, when I hear you and other leaders from Whole Foods talk, it's amazing how much you guys talk about love. Can you talk to us about that as a principle virtue to embody in our lives, both personally and professionally?

I would love to talk about love. You know, I mean, there's really. I think it is the most important virtue. I think it's at the essence of who we are as human beings. I think when you strip away all the fear, the layers of fear, what's underneath it is love. I think that love is the essence of what it means to be a person. And love, though, in our organizations has been in the closet, it's been in hiding. And primarily I think it is because love is seen as weak. We have this conception of business as this incredibly competitive dog eat dog world and where only the paranoid survive and survival of the fittest and we got to kill or be killed. And as a result, love is soft and. Or it's perceived as soft. And so it can't be permitted out of the closet, except it's something you can do at home, but you can't do it in the workplace. It can't be something in the organization. And I just think that's fundamentally wrong. And that love is not weak. Love is very strong, is a glue that holds an organization together. It's the relationships that bind. And when we don't allow people to be loving in the workplace, we are in a sense denying their full humanity. We're not letting them be fully human. We've told them that love is something they can do when they go home, something they can do with their families or their friends. But, you know, checking in at the front door here because we're about something else. I disagree with that. I think Whole Foods Market is a company that has a lot of love flowing around it. I think most conscious businesses do. And I think one of the most healthy trends. Brian that's going to help unlock love in the corporate workplace is the increasing feminization that is going on right now. But what I mean by that is studying and doing the research on our book, we found some amazing statistics. Let me share some of them with you. 60% of all, all the people getting college degrees today are women. 70% of all people in graduate school now are women. Women are systematically taking over most of the professions. Medicine, law, accounting, education, pretty much everything but engineering and the military are now primarily. The people that are getting the advanced degrees are women. Women are a guy who's been married for 21 years. And I can tell you that not all women and not all men. You make gender stereotypes, you get some people upset. But it's been my experience in life that generally women have a higher degree of emotional intelligence than men do. They are more common, comfortable, they are more empathetic, and they are better communicators and they understand the importance of relationships and they understand the importance of love. And as women become more empowered in our corporations, as they rise up into increasing leadership positions, that you're going to see love again come out of the closet. We're going to see fundamental transformation of our business organizations or corporations in the 21st century. So. And interestingly enough, 40% of all privately owned businesses are now owned by women. And a staggering 70% of new startups are being done by women. Wow. It's phenomenal. So the big challenge for women is to scale. They have to scale. Hang on one second. So a lot of the women owned business have not been able to scale up and that's going to be one of their big challenges as our world continues to evolve and transform itself.

Right on. Well, thanks for sharing that. I know that you've got to go. We've already gone over our time. Can I get your thought on meditation? It's so big that it's such a big part of what we teach. Can you talk about meditation briefly?

Well, can I talk about meditation.

The role it's played in your life? Recommended.

I think people need some. I think people need, people need a practice. They need some type of spiritual discipline in their lives to, to continue their own evolutionary journey. And I think meditation is one of the very best practices that we can do. And there are different kinds of meditations and each of us needs to experiment with it until we find one that we really personally resonate with and that works well for us. You know, I've experimented with a variety of different meditative techniques over the years, including many, many, many Many, many years ago being initiated into tem. I still practice that when I sit down and do a concentrated meditation, I will go back and just do a tm Same mantra that I got a long time ago and I've never told anybody else. I followed all the rules and that seems to work pretty well for me personally. But I also greatly believe in the insight meditation, the more Buddhist meditation of Vipassa where you can practice this not just when you go into a quiet setting, but you can practice it all the time. It's simply just coming back to the present moment and observing it, not being lost in our thoughts and our daydreams, in our inner talk. The inner talk is fundamentally, if you listen to it, pay attention to it, you'll see it's pretty much intriguing. Just jibber jabber and a lot of fear, a lot of judgment, a lot of anger, a lot of negative emotions exist in that self talk. It hypnotizes people. And the great thing about meditation is it gets us out of that self talk and lets us experience what's really happening in the moment. So yeah, meditation, very important and I think for any type of serious spiritual growth. I don't know if it's absolutely necessary, but at some point. I don't know if it's absolutely necessary, but it definitely is an accelerator and I don't know of a better tool people can use to accelerate their own spiritual growth.

Amen to that. Wonderfully said. And then to wrap it up, number one tip, what would be your number one tip for individuals looking to optimize their life?

I've already given it at the very beginning. Follow your heart.

Fantastic. Well John, again, thank you so much. Everyone listening. Conscious liberating the heroic spirit of business. Unbelievable. Great intellectual overview of the power free markets, conscious capitalism and then just a great description of John's process of developing his own leadership and how we can embrace some of the ideas that we just touched on today. Again, John, thank you so much for being who you are and being such a big inspiration for me and countless others.

Thanks Brian. Great talking with you.

We hope you enjoyed this optimal living interview. Please visit BrianJohnson me for more.

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