State of Government: Can Developing Democracy Change Business For Good?

This post is part of a series in which LinkedIn Influencers analyze the state and future of their industry. Read all the posts here.

When LinkedIn asked me to write about the State Of My Industry, it was a difficult choice. After all, entrepreneurs shouldn't always limit themselves to just one sector – we certainly haven't at Virgin! So rather than discussing space, finance, travel, technology, communications, entertainment or health and wellness, I started pondering one of the things affects all of those industries and unites millions of people around the world: democracy.

Alongside Jochen Zeitz, Kathy Calvin, Arianna Huffington, Paul Polman and many other business leaders, I am part of The B Team. We are a not-for-profit working to find better ways of doing business for the wellbeing of people and the planet. One of the key themes we have been debating is how democracy can be improved, and how this could impact upon businesses.

The Economist put together a fascinating feature about what has gone wrong with democracy, and how it can be revived. It pointed out why democracy is so loved by those of us who have it, and desired by many who don't:

Democracies are on average richer than non-democracies, are less likely to go to war and have a better record of fighting corruption. More fundamentally, democracy lets people speak their minds and shape their own and their children’s futures. That so many people in so many different parts of the world are prepared to risk so much for this idea is testimony to its enduring appeal."

More people than ever before (40%) now live in countries that hold free and fair elections. However, 2013 was the eighth consecutive year in which global freedom declined. Is the way people think about democracy, and the way it affects business, in flux?

There has been lots of debate recently about the Chinese system, and the benefits to business that it can bring. Places like China are certainly experiencing speedy economic growth. They can move quickly, and are less likely to get gridlocked. On the other hand, their system is rightly criticised for human rights abuses and blocking free speech. Is there a way to get the efficiency and growth of the Chinese system, but combine it with the freedom democracy brings?

One change could be to pay politicians as well as leading businesspersons better – but have far fewer of them so it doesn’t cost the country more. Research has shown paying politicians more improves quality, and a talented, diverse new generation of people would be attracted to positions where they could make a difference. This model is working well for Singapore’s economy, where the Prime Minister earns around four times more than President Barack Obama. Having people with entrepreneurial skills running departments could have a marked impact upon changing business for good.

Politicians should be given more power to get on and do the job right. Entrepreneurs, surrounded by great teams of people, can achieve so much more because they have the freedom to try things, are not afraid of failure, and have the desire to take calculated risks.

Democratic countries should find the time to sit back and debate what lessons they can take from how successful businesses run, which could make for more efficient, more productive, more effective countries, whilst protecting all the wonderful benefits that go with democracy.

In what ways do you feel that democratic countries could be run more effectively?

Want more insight? Follow our Law & Government channel.

Enjoyed this post? Read what other Influencers had to say:

• Bruce Katz on the State of Think Tanks: There's a World Outside Washington
• Stan McChrystal on the State of Consulting: Efficiency vs Adaptability
• Rita J King on State of Innovation: Thriving in the Imagination Age

Photo: Courtesy of Virgin.