Fast Company: ‘How an economist’s cry for ethical capitalism was heard’
Not long ago, economist Noreena Hertz lived at the lefty margins of her field. But her (widely ignored) prediction of the credit crisis and her call for a more evolved form of capitalism have suddenly put her at the center of the universe.
By Danielle Sacks
Published: November 1, 2009
Noreena Hertz had to seduce Bono. The Cambridge University economist was writing a book on the developing world, and Bono’s personal saga of getting the U.S. government to cancel more than $400 million of debt was just the pop-culture bridge she needed to move her ideas beyond the wonkish corridors of academia. After all, Hertz’s motive for The Debt Threat — a deep dive into the debt trap that, she argued, would have global consequences for all — was to juice the campaign that had been building slowly in activist ranks. The book itself would be a battle cry (a postcard inside made it easy for U.K. readers to urge the prime minister to cancel billions owed by the world’s poorest countries), and its release was pegged to hit before the 2005 G8 meeting. Hertz sent Bono an email, unsure if it would find him. To her astonishment, it did: “I’m so glad you got in touch,” read the rock star’s reply. “I’m a real fan of your work. Bono.”
Few academics have leaped from the critical fringes to the role of prophet as adroitly as Hertz. Wielding her contrarian message — that markets need to serve the interests of people as much as they serve companies or shareholders — Hertz has been campaigning for the past decade against the mantras of mainstream economists, urging a more ethical form of capitalism. But her message isn’t some yoga-infused spiritual quest. As she explained in her 2001 European best seller, The Silent Takeover, it is about the unsustainability — environmentally, socially, and economically — of laissez-faire capitalism and the idea that markets are stable. If the surge of corporate power was going to leave governments relatively impotent, Hertz argued, then those corporations themselves needed to fill the void. “She moved the conversation from what corporations can do to be socially responsible to a much more profound examination of the boundaries of corporate behavior and public behavior and where they have failed,” says Debora Spar, who was a dean at Harvard Business School for nearly two decades and is now president of Barnard. “She’s much more radical.”
Read the rest of this profile on the Fast Company website