Entrepreneurialism and society need to relate wholesomely if either is to flourish. In reality, the relationship is broken, in at least three different ways.<\/p>\n
<\/p>\n
First, <\/strong>most countries around the world are not committed to supporting entrepreneurship[i]<\/a>. Such support requires alignment between politics, law, the monetary system, economics, education, finance, and the whole national culture. The USA, historically one of the friendliest to entrepreneurs, is rapidly becoming frostier for them[ii]<\/a>.\u00a0 In many countries, entrepreneurs are regarded as a threat to the governing elite, being dispatched to prison if they are \u201ctoo successful\u201d.\u00a0 In other countries, such as China, any entrepreneur has to toe the line of the ruling party.\u00a0 Even then, an entrepreneur\u2019s success may be ephemeral.\u00a0 This has been seen not only since China became a Communist country in 1949 but specifically over the last few years.<\/p>\n <\/p>\n Second, <\/strong>in some cultures, the system supports certain groups or cliques but not the citizenry as a whole. An example of this is my own country of origin, India, where the culture historically supported entrepreneurialism only from one caste: every other caste was penalised for even thinking of any entrepreneurial activity. Officially, an interest rate of between 80% a month and 24% a year[iii]<\/a> was allowed, depending on the caste of the person to whom money was loaned.\u00a0 Unofficially, the culture endorsed unthinkable interest rates, within living memory rising as high as 3600% per year, leading to millions of people being reduced to virtual slavery or \u201cbonded labour\u201d.\u00a0 Clearly, such a culture won\u2019t allow the average citizen to flourish. No wonder limits were set on usury, and bonded labour abolished, after democracy was established in India – though the reach of the law there is neither wide nor consistent. By contrast, the country with the fairest and most extensive system of support for entrepreneurs is Israel[iv]<\/a>.<\/p>\n <\/p>\n The two kinds of breaks mentioned above, and related varieties of \u201ccrony capitalism\u201d, were quite common historically, but began to decline with the separation of entrepreneurs from the state, which started as a result of the 16th<\/sup> century Protestant Reformation. This instituted \u201cthe rule of law\u201d and popularised Judeo-Christian thinking on morality, creativity, hard work, honest trade, a modest lifestyle, public responsibility and societal good. It resulted in what we call the modern world, impacting not only countries in Northern Europe and North America but most countries round the world[v]<\/a>.\u00a0 However, as the influence of the Reformation has declined since the 1980s, entrepreneurs and politicians seem to be increasingly arriving again at an entente cordiale to benefit themselves and to disadvantage most citizens.<\/p>\n <\/p>\n The third <\/strong>break in the bond between entrepreneurs and society is when entrepreneurs don\u2019t support their own country as much as they should.\u00a0 Indeed, many entrepreneurs abandon their country of origin and move to countries which provide better opportunities or lower tax rates.\u00a0 Economic migration is understandable where the entrepreneurs are poor, or are just starting.\u00a0 But worldwide acceptability of entrepreneurship decreases if established or highly successful entrepreneurs are too greedy[vi]<\/a>.<\/p>\n <\/p>\n Such overreach has at least four symptoms:<\/p>\n In such matters, Western countries had made enviable progress since the 16th<\/sup> century but, even there, progress has reversed noticeably since the 1980s[vii]<\/a>.\u00a0 The Netherlands, one of the main beneficiaries of the Reformation, now has over a hundred large companies which seem to pay hardly any tax[viii]<\/a>.<\/p>\n <\/p>\n By contrast, the Dutch Societal Alliance (MA) and the Healthy-Life-Alliance (HLA) are examples of initiatives being taken by numerous people – including entrepreneurs – who are trying to repair the breaks in the relational circle between entrepreneurship and society.<\/p>\n <\/p>\n Entrepreneurial drive toward mutually-beneficial goals is the only way of addressing today\u2019s global \u201cwicked problems\u201d. Relational business models based on stakeholder[ix]<\/a> value and impact arise from the circle between people, public bodies and private companies \u2013 that is, from coherence in society.<\/p>\n <\/p>\n About the author:<\/strong><\/p>\n Prabhu Guptara is Executive Director, Relational Analytics, Cambridge, UK; Member of the Board, Institute of Management, University of St Gallen, Switzerland; and Distinguished Professor of Global Business, Management and Public Policy, William Carey University, India.<\/p>\n <\/p>\n [i]<\/a> For one ranking regarding this, see the World Bank\u2019s \u201cEase of Doing Business Index\u201d http:\/\/www.doingbusiness.org\/rankings<\/a><\/p>\n [ii]<\/a>\u00a0 See http:\/\/www.kauffman.org\/microsites\/kauffman-index\/rankings\/national?Report=StartupActivity<\/a>;\u00a0 see also http:\/\/www.inc.com\/magazine\/201505\/leigh-buchanan\/the-vanishing-startups-in-decline.html<\/a><\/p>\n [iii]<\/a> Those rates are from one ancient religious text; other texts prescribe various other rates, in every case dependent on the caste of the borrower: The Manusmriti<\/u>, translated by George Buhler, Chapter VII, verses 140-142, accessible e.g. at http:\/\/hinduwebsite.com\/sacredscripts\/hinduism\/dharma\/manusmriti_2.asp<\/p>\n [iv]<\/a> For a brief discussion of this, see the text of my presentation in Israel on the 18th<\/sup> of February 2016: \u201chttp:\/\/www.alphamedicus.com\/documents\/mHealth_Israel_Conference_2016%20_Text_of_Prof_Guptara’s_speech_18February2016.pdf\u00a0\u00a0 For a longer paper on Israel\u2019s entrepreneur support system, see: http:\/\/www.alphamedicus.com\/documents\/Israel’s_Entrepreneurs_Support_System.pdf<\/p>\n [v]<\/a> See my chapter, \u201cTowards Creating the Right Kind of Globalisation<\/em> \u2013 Why it does not happen, and what to do about it\u201d in Joseph Straus (Ed.), The Role of Law and Ethics in the Globalized Economy<\/a>, Max Planck Institute Studies on Intellectual Property, Competition and Tax Law<\/em>, Volume 10, 2009, Springer Verlag, Berlin, Germany, pages\u00a0 61-82.\u00a0 For a different but very much fuller view, see Vishal Mangalwadi, The Book That Made Your World, Thomas Nelson, USA, 2011.<\/p>\n [vi]<\/a> For the latest howl of rage, see http:\/\/www.scmp.com\/comment\/blogs\/article\/1929324\/study-reveals-awfulness-canadian-investor-immigration-income-tax<\/a><\/p>\n [vii]<\/a> The evidence for this is exhaustively documented in Thomas Piketty, Capital in the Twenty-First Century, Harvard University Press, 2014.<\/p>\n [viii]<\/a> Tax avoidance is of course not limited to the Netherlands: http:\/\/www.corporateknights.com\/voices\/bernard-simon\/12331-14592312<\/a><\/p>\n and http:\/\/www.corporateknights.com\/channels\/leadership\/filing-deadline-14593140<\/a><\/p>\n\n