Article last updated 4 July 2025.
If you focus narrowly on the returns delivered to shareholders since the onslaught of COVID-19, you would have to say capitalism has navigated this extreme challenge successfully. But not in a sustainable way if the other stakeholders — employees, customers and the wider world — aren’t sharing in the benefits or, worse, if they’re paying a cost for delivering those returns.
Using an unlikely illustration from the history of the Prussian forest, we can address the myopic focus on short-term measures of profit growth in a surprisingly relevant way. We can set out some compelling reasons for every long-term investor to care about responsible capitalism — even if they don’t necessarily care about the societal benefits. Just as our natural ecosystem relies on biodiversity, we mustn’t make the mistake of thinking that company profits can be separated from the health of the entire economic ‘ecosystem’ in which those profits are made.
As we said in our 2019 report Responsible capitalism, where this parable was first published, we firmly believe that capitalism is the solution to the grave problems that threaten our future economic prosperity.
In fact, what we’re calling ‘responsible capitalism’ is true capitalism, as it was originally conceived. It’s a diverse ecosystem of businesses, the state and consumers, working together for the maximum long-term benefit of all.
Since first publishing this parable, we’ve continued exploring the 'whys, wheres and hows' of responsible investing, and working towards embedding principles of responsible capitalism into our investment processes.
We are fortunate in these efforts to have the support of our ethical, sustainable and impact investing specialist team at Rathbone Greenbank. At the end of this paper we also highlight some of the important work Greenbank has been doing in the area of biodiversity.
View Planet Papers 5: The economic ecosystem
Read our entire Planet Papers series here:
Planet Papers 1: A responsible recoveryPlanet Papers 2: Changing the planet Planet Papers 3: A brand new world Planet Papers 4: Feeding the planet Planet Papers 6: Cities to the rescue
Planet Papers 7: Good COP, bad COP
