universal operations Commons: 3/5

Stakeholder Capitalism Wef Model

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id: pat_01kg502402e8s98e5wh453cf4r page_url: https://commons-os.github.io/patterns/domain/stakeholder-capitalism-wef-model/ github_url: https://github.com/commons-os/patterns/blob/main/_patterns/stakeholder-capitalism-wef-model.md slug: stakeholder-capitalism-wef-model title: Stakeholder Capitalism - WEF Model aliases: [Stakeholder-centric model, Multi-stakeholder model] version: 1.0 created: 2026-01-28T00:00:00Z modified: 2026-01-28T00:00:00Z tags: universality: domain domain: design category: [framework] era: [cognitive] origin: [world-economic-forum, klaus-schwab] status: draft commons_alignment: 3 commons_domain: business generalizes_from: [“pat_01kg5023vzfs093rykahhhp6zr”] specializes_to: [] enables: [] requires: [] related: [] contributors: [higgerix, cloudsters] sources:

  • https://www.weforum.org/stories/2021/01/klaus-schwab-on-what-is-stakeholder-capitalism-history-relevance/
  • https://www.weforum.org/stories/2025/02/stakeholder-capitalism-what-it-is-and-what-it-isn-t/
  • https://www.investopedia.com/stakeholder-capitalism-4774323
  • https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2021/03/wef-ibc-common-metrics-measuring-stakeholder-capitalism.pdf
  • https://www.hbs.edu/faculty/Pages/item.aspx?num=60264 license: CC-BY-SA-4.0 attribution: Commons OS distributed by cloudsters, https://cloudsters.net repository: https://github.com/commons-os/patterns —

1. Overview

Stakeholder Capitalism, particularly the model championed by the World Economic Forum (WEF), is a framework for corporate governance that obligates companies to consider the interests of all their stakeholders, not just their shareholders. This represents a significant departure from the shareholder primacy model, which posits that a company’s sole responsibility is to maximize profits for its owners. In the stakeholder model, a company is viewed as a social organism embedded within a broader ecosystem, with a purpose that extends beyond pure financial returns. Key stakeholders typically include employees, customers, suppliers, local communities, and the environment, alongside shareholders. The core problem this pattern addresses is the negative externalities and societal inequalities that can arise from a myopic focus on short-term profits. By creating long-term value for all stakeholders, the model aims to build a more sustainable, equitable, and resilient form of capitalism.

The concept of considering multiple stakeholders is not new, with its roots tracing back to the post-war era in the 1950s and 1960s, especially in the social democracies of Europe. However, it was Klaus Schwab, the founder of the World Economic Forum, who formally articulated the theory in his 1971 book, “Modern Company Management in Mechanical Engineering.” The idea was later overshadowed by the rise of Milton Friedman’s shareholder primacy theory in the 1970s. The 21st century, however, has seen a powerful resurgence of stakeholder capitalism, driven by mounting concerns over climate change, social inequality, and a general loss of trust in traditional capitalist systems. The WEF has been at the forefront of this revival, culminating in the “Davos Manifesto 2020,” which explicitly states that the purpose of a company is to engage all its stakeholders in shared and sustained value creation. This modern iteration places a particular emphasis on the global and interconnected nature of today’s challenges, positioning “people” and the “planet” as central stakeholders in the global economic system.

2. Core Principles

The Stakeholder Capitalism model, as advanced by the World Economic Forum, is built upon a set of core principles that redefine the purpose and responsibilities of a corporation in the 21st century. These principles collectively advocate for a more equitable, sustainable, and long-term approach to business.

The Stakeholder Capitalism model is built on several core principles. The foundational principle is the primacy of all stakeholders, which asserts that a company’s duty is to create value for all stakeholders, including employees, customers, suppliers, communities, and society at large, not just shareholders [1]. This is coupled with a focus on long-term value creation over short-term profit maximization, encouraging investments in innovation and infrastructure for long-term resilience [2]. The modern WEF model places people and the planet at the center, recognizing that a healthy society and environment are prerequisites for sustainable economic prosperity [1]. The principle of interconnectedness and shared responsibility highlights the web of relationships between stakeholders and promotes collaboration to address global challenges [1]. Companies are expected to be purpose-driven, with a mission beyond financial performance, guided by strong governance and ethical conduct, including transparency, anti-corruption measures, and fair tax practices [3, 4]. Finally, consistent measurement and reporting using frameworks like the WEF’s Stakeholder Capitalism Metrics are crucial for accountability and continuous improvement [4].

3. Key Practices

Implementing Stakeholder Capitalism requires a shift from abstract principles to concrete actions. The following practices are essential for embedding a stakeholder-centric approach into a company’s strategy and operations. These practices are drawn from the WEF’s recommendations and the real-world applications of leading companies.

Key practices for implementing Stakeholder Capitalism include stakeholder engagement and materiality assessment to identify and prioritize ESG issues [4]. This is followed by integrated reporting of non-financial metrics, using frameworks like the WEF’s Stakeholder Capitalism Metrics, to enhance transparency [4]. Companies must ensure fair compensation and investment in employees, including a living wage and skills development [3], and extend this commitment to supply chain responsibility by ensuring ethical and sustainable practices among suppliers [1]. Community investment and social impact initiatives strengthen the company’s social license to operate [3], while environmental stewardship and decarbonization are critical for planetary health [4]. Ethical governance and tax responsibility are essential for building trust [4], and purpose-led innovation ensures that new products and services address societal needs [2]. Finally, long-term incentive structures that incorporate ESG metrics [3] and multi-stakeholder collaboration to tackle systemic challenges [1] are crucial for success.

4. Application Context

The Stakeholder Capitalism model is most effective for large, multinational corporations, consumer-facing companies, and organizations with a long-term investment horizon. It is less suitable for early-stage startups with limited resources or companies focused on short-term financial engineering. The principles can be applied at all scales, from the individual to the ecosystem level, and across various domains, including finance, technology, and healthcare.

5. Implementation

Implementation of the Stakeholder Capitalism model requires strong leadership commitment, a clear corporate purpose, and a baseline understanding of ESG performance. The initial steps involve establishing an ESG council, conducting a materiality assessment, developing a roadmap with clear targets (using frameworks like the WEF metrics), integrating ESG into governance and strategy, and ensuring transparent communication [4]. Common challenges include short-term investor pressure, data reliability issues, accusations of “greenwashing,” balancing competing stakeholder interests [5], and cultural resistance. Success factors include authentic leadership, a long-term perspective, strong stakeholder collaboration, a commitment to continuous improvement, and robust measurement and reporting.

6. Evidence & Impact

The shift towards Stakeholder Capitalism is not merely a theoretical exercise; it is increasingly being adopted by leading global companies, and there is a growing body of evidence demonstrating its positive impact on both financial performance and societal well-being. The movement has gained significant momentum, with many organizations publicly committing to its principles and reporting on their progress.

Notable Adopters:

The most significant endorsement of stakeholder capitalism came in 2019 when the Business Roundtable, an association of CEOs of America’s leading companies, issued a new “Statement on the Purpose of a Corporation.” This statement, signed by 181 CEOs, marked a formal departure from the long-held doctrine of shareholder primacy and a commitment to creating value for all stakeholders [3]. Beyond this collective pledge, numerous individual companies have become prominent examples of stakeholder capitalism in action:

  • Salesforce: Co-founder and CEO Marc Benioff is a vocal advocate for stakeholder capitalism, attributing his company’s success to its “1-1-1 model,” where it donates 1% of its equity, 1% of its product, and 1% of its employees’ time to charitable causes.
  • Unilever: Under the leadership of former CEO Paul Polman, Unilever became a pioneer in sustainable business, integrating social and environmental goals into its core business strategy.
  • Danone: The French multinational food-products corporation has a long history of social responsibility and became the largest B Corp in the world, a certification that recognizes companies for their high standards of social and environmental performance.
  • Patagonia: The outdoor apparel company is renowned for its environmental activism and its commitment to sustainable sourcing and ethical production.
  • Airbnb: As detailed in a Harvard Business School case study, Airbnb’s stakeholder model was put to the test during the COVID-19 pandemic. The company made difficult decisions to support its hosts and employees, demonstrating a commitment to its stated values even in a crisis [5].
  • WEF Lighthouse Companies: The World Economic Forum has recognized over 50 “Lighthouse” companies, including HEINEKEN, Philips, Schneider Electric, and Ecopetrol, for their leadership in adopting the Stakeholder Capitalism Metrics and integrating them into their reporting and decision-making processes.

Documented Outcomes:

Research is beginning to show a positive correlation between strong ESG performance and financial outperformance. Companies that embrace a stakeholder orientation tend to exhibit:

  • Enhanced Financial Performance: A meta-study by NYU’s Stern Center for Sustainable Business found a positive relationship between ESG and financial performance for 58% of the corporate studies analyzed.
  • Improved Risk Management: By considering a broader range of risks (including environmental, social, and governance risks), stakeholder-oriented companies are better able to anticipate and mitigate potential threats to their business.
  • Increased Innovation: A focus on solving societal challenges can spur innovation, leading to the development of new products, services, and business models.
  • Higher Employee Engagement and Talent Retention: Companies that invest in their employees and create a positive work environment are better able to attract and retain top talent.
  • Stronger Brand Reputation and Customer Loyalty: Consumers are increasingly drawn to brands that demonstrate a commitment to social and environmental responsibility.

Research Support:

The principles of stakeholder capitalism are supported by a growing body of academic and institutional research:

  1. “Measuring Stakeholder Capitalism: Towards Common Metrics and Consistent Reporting of Sustainable Value Creation” (World Economic Forum, 2020): This report, developed in collaboration with the “Big Four” accounting firms, provides a comprehensive framework of 21 core and 34 expanded metrics for measuring and reporting on stakeholder value creation [4].
  2. “The Case for Stakeholder Capitalism” (McKinsey & Company, 2020): This article argues that embracing stakeholder responsibilities can benefit shareholders as well, by creating more resilient and valuable companies in the long run.
  3. “Airbnb During the Pandemic: Stakeholder Capitalism Faces a Critical Test” (Harvard Business School, 2021): This case study provides a real-world example of the challenges and opportunities of implementing a stakeholder model in a crisis situation [5].

7. Cognitive Era Considerations

The transition into the Cognitive Era, characterized by the increasing sophistication and integration of artificial intelligence and automation, presents both significant opportunities and new challenges for the Stakeholder Capitalism model. The ability of AI to process vast amounts of data and identify complex patterns can greatly enhance the implementation and effectiveness of this framework, while also raising new questions about the future of work and the role of human judgment.

Cognitive Augmentation Potential:

AI and automation can significantly augment the practice of stakeholder capitalism in several ways. The collection, analysis, and reporting of ESG data, a cornerstone of the WEF’s framework, can be largely automated. AI-powered platforms can monitor a company’s environmental footprint in real-time, analyze employee sentiment from internal communications, and track supply chain compliance with ethical standards. This can lead to more accurate, timely, and transparent reporting, reducing the burden on companies and providing stakeholders with more reliable information. Furthermore, AI can be used to model the complex interdependencies between different stakeholder interests, helping leaders to make more informed decisions that optimize for long-term, shared value creation. For example, an AI system could simulate the potential impacts of a new investment on everything from local employment to carbon emissions, allowing for a more holistic cost-benefit analysis.

Human-Machine Balance:

Despite the power of AI, the uniquely human aspects of leadership and ethical judgment will become more important than ever in the Cognitive Era. While AI can provide the data and the analysis, it cannot replicate the empathy, moral reasoning, and contextual understanding required to navigate the complex and often conflicting demands of different stakeholders. The “art” of stakeholder capitalism—balancing competing interests, building trust, and making values-based decisions—will remain a fundamentally human endeavor. The role of leaders will shift from being managers of information to being facilitators of dialogue, ethical arbiters, and visionaries who can inspire a shared sense of purpose. The challenge will be to create a symbiotic relationship between human and machine, where AI provides the “science” of stakeholder analysis, and humans provide the “wisdom” of stakeholder engagement.

Evolution Outlook:

Looking ahead, the Stakeholder Capitalism model is likely to evolve in response to the capabilities of the Cognitive Era. We can expect to see the emergence of more dynamic and data-driven approaches to stakeholder engagement, where companies can respond to stakeholder needs in real-time. The concept of “stakeholder experience” (SX) may become as important as customer experience (CX), with companies using AI to personalize their interactions with employees, suppliers, and community members. The WEF’s Stakeholder Capitalism Metrics will likely evolve to incorporate more forward-looking and predictive indicators, enabled by AI-powered forecasting. However, the fundamental principles of the model—long-term value creation, shared responsibility, and a commitment to people and the planet—will remain as relevant as ever. The key to a successful evolution will be to harness the power of technology to enhance, not replace, the human-centered values that lie at the heart of stakeholder capitalism.

8. Commons Alignment Assessment (v2.0)

This assessment evaluates the pattern based on the Commons OS v2.0 framework, which focuses on the pattern’s ability to enable resilient collective value creation.

1. Stakeholder Architecture: The pattern defines stakeholders broadly to include employees, customers, suppliers, communities, and the environment, establishing a responsibility to create value for all. However, it does not fundamentally alter the power structure, as it lacks mechanisms for distributing formal Rights (like governance) to non-shareholder stakeholders. The architecture of Rights and Responsibilities is more of a voluntary commitment than a structural redesign.

2. Value Creation Capability: The model explicitly enables collective value creation beyond economic output, promoting social, ecological, and knowledge value through investments in people and the planet. It aims for “shared and sustained value creation,” broadening the definition of corporate success. This capability is still often framed within a business case of long-term financial resilience, rather than as an intrinsic goal of the system.

3. Resilience & Adaptability: By promoting a long-term view and requiring consideration of a wide range of environmental, social, and governance (ESG) factors, the pattern helps systems adapt to complexity and maintain coherence. This proactive approach to risk and opportunity, such as investing in workforce skills or sustainable supply chains, builds resilience against systemic shocks. The framework encourages companies to thrive on change by internalizing externalities and anticipating future challenges.

4. Ownership Architecture: The pattern fails to redefine ownership beyond monetary equity, which remains concentrated with shareholders who hold ultimate control. It advocates for a sense of stewardship and responsibility from owners and managers but does not architect new forms of ownership that distribute rights and responsibilities more broadly. The core logic of ownership as a financial asset with control rights remains unchanged.

5. Design for Autonomy: The framework is compatible with AI and other technologies for enhancing analysis and reporting, as noted in its Cognitive Era considerations. However, its implementation requires significant coordination overhead for stakeholder engagement, balancing competing interests, and extensive reporting. It is not designed for the kind of low-friction, automated coordination seen in DAOs or truly distributed systems.

6. Composability & Interoperability: The model is highly composable, designed as a high-level framework that integrates with other patterns and standards like B Corp certification or GRI/SASB reporting. The WEF’s common metrics provide a basis for interoperability, allowing different organizations to report and collaborate using a shared language. This allows it to be a foundational layer for building larger, multi-stakeholder value-creation systems.

7. Fractal Value Creation: The pattern’s core logic of creating value for all stakeholders can be applied at multiple scales, from an individual’s mindset to a team’s process, a corporation’s strategy, and a global ecosystem. This fractal nature allows the principles to be adapted and implemented in diverse contexts, demonstrating a key feature of a resilient value-creation architecture. The WEF actively promotes this multi-scalar application.

Overall Score: 3/5 (Transitional)

Rationale: The Stakeholder Capitalism model is a crucial transitional framework that bridges the gap between shareholder primacy and a true value-creation architecture. It successfully introduces the language and logic of collective value creation, resilience, and multi-stakeholder responsibility into the mainstream corporate world. However, its failure to fundamentally restructure ownership and governance rights means it remains a significant adaptation of the existing paradigm, not a replacement. It has the potential to enable resilient value creation, but its effectiveness is contingent on voluntary adoption and is limited by the unaltered, underlying power structures of shareholder control.

Opportunities for Improvement:

  • Integrate formal governance mechanisms, such as multi-stakeholder representation on boards or binding stakeholder councils, to give non-shareholders true rights.
  • Develop and incorporate new ownership models, like steward-ownership or perpetual purpose trusts, that structurally embed purpose and stakeholder responsibility.
  • Move beyond reporting frameworks to create dynamic, real-time systems for stakeholder feedback and value flow accounting, potentially using distributed ledger technology.

The Stakeholder Capitalism model, particularly as promoted by the World Economic Forum, represents a significant step away from a purely extractive, shareholder-centric view of the economy. Its alignment with the principles of a commons-based approach, however, is nuanced and depends heavily on the depth and authenticity of its implementation. This assessment evaluates the model against the seven dimensions of commons alignment.

  1. Stakeholder Mapping: The model’s very foundation is a comprehensive mapping of stakeholders beyond just shareholders. The WEF framework explicitly includes employees, customers, suppliers, local communities, and, crucially, the “planet” and “people” as a whole [1]. This is a broad and inclusive approach to stakeholder identification. However, the comprehensiveness in practice can vary. A potential weakness is the risk of “stakeholder washing,” where companies identify a wide range of stakeholders for public relations purposes but fail to give them a genuine voice or influence in decision-making. The model is strong in its intent, but the quality of the mapping depends on the integrity of the company implementing it.

  2. Value Creation: Stakeholder capitalism explicitly aims to create multiple forms of value beyond financial profit, including social and environmental value. The framework encourages investment in employee well-being, community development, and environmental protection [4]. The benefits are intended to be distributed among all stakeholders, leading to a more equitable distribution of value than the shareholder primacy model. The primary beneficiaries are still the company and its direct stakeholders, but the model acknowledges a responsibility to society at large. The question remains whether this value creation is truly regenerative and contributes to the flourishing of the commons, or if it is simply a more sustainable form of extraction.

  3. Value Preservation: The model has a strong focus on long-term value creation and the preservation of the resources on which the company depends. By internalizing environmental and social costs, the model encourages companies to act as stewards of the natural and social commons. The emphasis on sustainability and responsible resource management is a key element of value preservation. The WEF’s metrics for “Planet” and “People” provide a framework for tracking and preserving these forms of capital [4]. The challenge lies in the potential for trade-offs between short-term financial pressures and long-term preservation goals.

  4. Shared Rights & Responsibilities: The model advocates for a distribution of responsibilities among all stakeholders. Companies have a responsibility to society, and in turn, stakeholders have a responsibility to engage with companies and hold them accountable. However, the distribution of rights is less clear. While the model gives stakeholders a voice, it does not typically grant them formal governance rights in the same way that shareholders have. Employees may have representation on boards in some European countries, but this is not a universal feature of the model. The power imbalance between shareholders and other stakeholders remains a significant challenge.

  5. Systematic Design: The WEF has made a significant effort to create a systematic design for the implementation of stakeholder capitalism through its “Stakeholder Capitalism Metrics” [4]. This provides a clear framework for companies to measure, report on, and improve their ESG performance. The four pillars (Governance, Planet, People, Prosperity) and the 21 core metrics offer a practical toolkit for embedding stakeholder considerations into corporate governance and operations. This systematic approach is a major strength of the model.

  6. Systems of Systems: The model is inherently designed to operate within a “systems of systems” context. It recognizes that a company is not an isolated entity but is part of a complex ecosystem of suppliers, customers, communities, and governments. The framework encourages multi-stakeholder collaboration to address systemic challenges like climate change and inequality. The WEF itself acts as a platform for fostering these kinds of collaborations at a global level. The model’s emphasis on interconnectedness is a key alignment with commons thinking.

  7. Fractal Properties: The principles of stakeholder capitalism can be applied at multiple scales, from the individual to the global ecosystem. An individual employee can adopt a stakeholder mindset, a team can work to create value for its internal and external stakeholders, and a company can operate as a responsible citizen of the world. This fractal nature allows the principles to be adapted and applied in a wide variety of contexts, which is a key characteristic of a robust and resilient pattern.

Overall Score: 4/5 (Commons-Aligned)

The Stakeholder Capitalism - WEF Model is assessed as Commons-Aligned. It represents a significant and positive evolution from the extractive model of shareholder primacy. Its strengths lie in its comprehensive stakeholder mapping, its focus on long-term value creation, its systematic design, and its applicability across scales. It provides a practical and actionable framework for companies to begin the journey of aligning their interests with those of society and the planet.

However, it is not a perfect model and falls short of being an “Exemplary Commons” pattern. The primary reason for this is the persistent power imbalance between shareholders and other stakeholders. The model encourages companies to consider the interests of all stakeholders, but it does not fundamentally alter the legal and governance structures that give shareholders ultimate control. There is a risk that, when push comes to shove, shareholder interests will still prevail, as was a central tension in the Airbnb case study [5].

Opportunities for Improvement:

To move closer to an exemplary commons model, stakeholder capitalism could be enhanced by:

  • Strengthening Stakeholder Governance: Exploring models of multi-stakeholder governance that give non-shareholder stakeholders a more formal role in decision-making, such as through board representation or stakeholder councils with real power.
  • Adopting Regenerative Practices: Moving beyond sustainability (doing less harm) to a more regenerative approach (actively restoring and revitalizing the commons).
  • Embracing Open Source Principles: Increasing transparency and collaboration by open-sourcing ESG data, methodologies, and best practices to accelerate collective learning and improvement.

9. Resources & References

This section provides a curated list of resources for further exploration of Stakeholder Capitalism, including essential reading, key organizations, and a full list of references cited in this document.

Essential Reading:

  • Schwab, K., & Vanham, P. (2021). Stakeholder Capitalism: A Global Economy that Works for Progress, People and Planet. Wiley. This book, written by the founder of the World Economic Forum, provides a comprehensive overview of the history, principles, and future of stakeholder capitalism. It is the foundational text for the WEF’s modern interpretation of the model.
  • World Economic Forum. (2020). Measuring Stakeholder Capitalism: Towards Common Metrics and Consistent Reporting of Sustainable Value Creation. This white paper outlines the WEF’s Stakeholder Capitalism Metrics, providing a practical framework for companies to measure and report on their ESG performance. It is an essential resource for anyone looking to implement the model.
  • Friedman, M. (1970, September 13). The Social Responsibility of Business Is to Increase Its Profits. The New York Times Magazine. To fully understand the significance of stakeholder capitalism, it is essential to read the most famous articulation of the opposing view. This article by Milton Friedman is the cornerstone of the shareholder primacy model.
  • Esty, B. C., & Ciechanover, A. (2021). Airbnb During the Pandemic: Stakeholder Capitalism Faces a Critical Test. Harvard Business School Case 221-050. This case study provides a real-world example of the challenges and complexities of implementing a stakeholder model in a crisis, offering valuable lessons for leaders.

Organizations & Communities:

  • World Economic Forum (WEF): The WEF is the leading global organization promoting stakeholder capitalism. Its website and publications are the primary source of information on the model and its implementation.
  • Business Roundtable: This association of leading CEOs has officially endorsed stakeholder capitalism, and its publications provide insights into how large corporations are approaching the transition.
  • B Lab: The non-profit organization behind the B Corp Certification, which recognizes companies for their high standards of social and environmental performance. The B Corp movement is a practical manifestation of stakeholder capitalism.
  • JUST Capital: An independent research organization that tracks and ranks large U.S. companies on their performance on the issues that matter most to the American public. Their work provides valuable data on how companies are serving their stakeholders.

Tools & Platforms:

  • WEF Stakeholder Capitalism Metrics: The set of 21 core and 34 expanded metrics provides a comprehensive toolkit for measuring and reporting on ESG performance.
  • GRI Standards: The Global Reporting Initiative (GRI) provides the world’s most widely used standards for sustainability reporting.
  • SASB Standards: The Sustainability Accounting Standards Board (SASB) provides industry-specific standards for reporting on financially material sustainability information.

References:

[1] Schwab, K. (2021, January 22). What is stakeholder capitalism? It’s History and Relevance. World Economic Forum. Retrieved from https://www.weforum.org/stories/2021/01/klaus-schwab-on-what-is-stakeholder-capitalism-history-relevance/

[2] Schwab, K. (2025, February 20). What stakeholder capitalism is and what it isn’t. World Economic Forum. Retrieved from https://www.weforum.org/stories/2025/02/stakeholder-capitalism-what-it-is-and-what-it-isn-t/

[3] D’Souza, D. (2025, September 11). Understanding Stakeholder Capitalism: Serving All Interests. Investopedia. Retrieved from https://www.investopedia.com/stakeholder-capitalism-4774323

[4] KPMG. (2022). Measuring Stakeholder Capitalism: WEF IBC common metrics. Retrieved from https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2021/03/wef-ibc-common-metrics-measuring-stakeholder-capitalism.pdf

[5] Esty, B. C., & Ciechanover, A. (2021). Airbnb During the Pandemic: Stakeholder Capitalism Faces a Critical Test. Harvard Business School. Retrieved from https://www.hbs.edu/faculty/Pages/item.aspx?num=60264