Claire Chiang: First Principles and Compassionate Capitalism
NEW YORK, October 22, 2012 — In a rousing affirmation of the role business can and should play in social progress, Claire Chiang, co-Founder of Banyan Tree Hotels & Resorts and Senior Vice President of Banyan Tree Holdings, spoke here on the need to moderate capitalism, and to employ instead "compassionate capitalism" — a free-market structure that prioritizes a long-term increase in people's standard of living.
A part of the Citi Foundation's Series on Asian Women Leaders, Chiang's talk was moderated by Dinda Elliott, the Global Affairs Editor of Conde Nast Traveler.
Citing the Ten Commandments, Chiang stated that businesses must adopt "first principles," ethical systems that have never been questioned. She repeated that one "can do well by doing good" several times, indicating that a sense of reciprocity is embedded in the idea of social responsibility — an old concept that has been practiced in Asia throughout history.
The key to running a business that is both lucrative and socially responsible is the creation of a holistic and sustainable brand that people can believe in. Chiang acknowledged that differences in markets around the world indicate that no single model fits all. However, in the case of Banyan Tree, Chiang studied market tourism and found that world demographics want privacy and intimacy. She thus structured Banyan Tree Hotels & Resorts to incorporate high-quality spacious villas, rather than high-quantity small apartments. She predicted that lower resource costs, combined with the consumer's willingness to pay more, would generate a higher profit. And it did.
Chiang concluded by answering audience questions, several of which raised the differences in entrepreneurial social responsibility between America and Asia. Among Chiang's insightful answers was her declaration that the world is entering what she called a "rainbow civilization" characterized by diversity and open communication. The United States and Asia don't need to adopt each other's models; they just need to create mutual understanding. Such an understanding, she said, would ultimately generate an accurate interpretation of the global market and its demands, resulting in both lucrative business and an emphasis on the social well being of the global community.
Reported by Renny Grinshpan
Video: Highlights from the program (4 min., 14 sec.)