In explaining why he grilled Sec’y of State Condoleeza Rice in Davos, Dr. Daniel Vasella, chief executive of Novartis, the Swiss pharmaceutical giant, offers these words of wisdom–and perhaps warning–to CEO’s who feel they can and should abdicate their own beliefs and values to further the corporate mission:

The first responsibility of a C.E.O. is to run his company successfully and generate products which are useful to your customers, resulting in economic value creation. We also have to act responsibly, respecting not only the law, but also fulfilling legitimate expectations that society has of us. Today these expectations in most instances go beyond short-term profit maximization. What people want is that businesspeople behave in a responsible way in communities in which they live, that they treat employees fairly, respect the environment and demonstrate sensitivity to the problems of other, disadvantaged people in the world. I think corporate social responsibility has taken a much more important role than it used to.

And later:

…some of my fellow C.E.O.’s believe they should not express themselves on political issues at all. They should just do business. I think that is not the right attitude. First of all, we are citizens of whatever country we are from. We have a citizenship responsibility. Secondly, I do believe we have to examine our own beliefs and value systems regularly. We cannot act in a void. I think there is very clear responsibility.

As global power migrates from nation-states to corporations, the behaviors and expectations of these corporate citizens will become increasingly central to peace and prosperity.

Posting for Always On, Scott Lenet, Co-founder and Managing Director of venture capital firm DFJ Frontier offers a compelling case study of corporate citizenship. As William McDonough argues, “Commerce is the engine of change.” One of DFJ Frontier’s funded ventures,World of Good, is attempting, and so far succeeding, to change the ways that first world consumption affects third world production (and social) systems.

When consumers can get information easily that allows them to compare alternatives, prices reach equilibrium and unfair advantage tends to disappear.

But imagine this model turned upside down, where the power of the internet could be used to help uninformed suppliers in a market where buyers have all the control. Craft producing villages around the world have little access to market information on the selling price of their goods as they move through the global supply chain. These producers rarely have the ability to assess the value of their labor and are unable to negotiate prices to ensure that they live above the poverty line.

This is why World of Good founder Priya Haji has introduced web-based floor pricing technology for worldwide distribution to craft producers. Literally anywhere in the world, a producer, their representative, or a buyer can test pricing in real time. This calculator shows how the price of goods compares to United Nations indicators of poverty and international labor wage data. Immediately, artisans can use this information to negotiate market prices while buyers with conscience can see how their pricing policies compare to their intentions. Using the internet, World of Good embodies a key requirement for free markets: the free flow of information.

In my last post, I described the dangers of assuming a moonshot or Manhattan project could solve America’s energy crisis. The Bush administration, releasing some of their text for the upcoming state of the union address, perpetuates the myth that large-scale projects are effective solutions:

“America is addicted to oil, which is often imported from unstable parts of the world,” Bush said in the excerpts. “The best way to break this addiction is through technology.”

Not to be crass, but most moonshot projects work because, to be effective, their output (rockets or bombs) requires little to no changes in individual behavior or social values. Changes in energy production or consumption, on the other hand, will require changes in what we buy, drive, eat, etc… The danger lies in believing there is a single technological solution out there which, if found, would make all of our problems go away, because that belief prevents us from making harder choices, and taking on greater challenges at the local levels.

The more we believe someone else will bring us a (technological) solution, the less responsibility we feel for solving the problem ourselves. The real solution, if history is any guide, will come from the emergence and confluence of many local solutions.

One of the problems with expecting technological innovation to solve social problems–like expecting energy research to solve the energy crisis–may be our perpetual confusion between the means and ends. It’s alright to have a moonshot goal (the end-game), but the means for getting there need not, and likely should not, be NASA-scaled, centrally-controlled, and monstrously-funded projects.

Thomas Friedman, for example, recently described Texas Instrument’s green chip factory in Richardson, Texas recently (A Green Dream in Texas). TI’s plant was designed and built in a “cost-saving, hyper-efficient green manner.” It’s not clear how efficient is efficient but, in any case, what’s interesting is how Friedman uses the green factory to call for an “energy independence” moonshot:

In 1961, when President Kennedy called for putting a man on the moon, he didn’t know how – but his vision was so compelling, his expectations of the American people so high, that they drove the moon shot well after he died. The Bush-Cheney team should be inspiring our generation’s moon shot: energy independence. But so far all they’ve challenged Americans to do is accept a tax cut.

Friedman supports the goal of moonshot. The end he has in mind is exactly what we need. But in reality, what’s harder–putting one man on the moon or a million men and women into hydrogen-powered cars? And why?

Governments are organized well to build cathedrals, but not bazaars. Unfortunately, some of the greatest leaps forward are too complicated to be solved by one single project or person; instead they take place over time and across countless, nameless people (as Jean Henri Fabre once said, “History records the names of royal bastards, but cannot tell us the origin of wheat”). Throwing money at creating the single best solution, like building one rocket, or one bomb, is easy compared to creating a technological revolution that requires an accompanying social revolution to succeed. For these problems, it’s better to build bazaars–the open source communities where ideas and behaviors co-evolve. And from which spring the real revolutions.