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Economics of Mutuality
Economics of Mutuality (EoM) [ here: disambiguation with John Kay ] is a normative economics theory that makes the hypothesis that value creation is “more effective and sustainable when all parts of the value chain are considered” or when it creates a Mutuality of benefits for all stakeholders in the same ecosystem. It is a theory the is being widely experimented as an innovaive business model inside of Mars Inc., the most mature business is based in Kenya, called project Maua. It is the subject of a case study with Said Business School, University of Oxford [ref Project Maua Case Study]

EoM was first publicly discussed in “Exploring Mutuality”, Freuds’ The Brewery Journal, January 2014 . The Issue hosted Mars, Incorporated with a section dedicated to EoM presented as a research program that Mars started in early 2007, when a Mars family shareholder asked whether there should be a ‘right’ level of profit for a company. If profit is needed to reinvest into the company’s business, too high a level of profit could harm other stakeholders and potentially endanger the resiliency of the ecosystem the company is itself part of (for more about the history see – Chapter 3).

Contrary to the Chicago School, for which economic actors’ only objective is to maximize financial profit, EoM makes the hypothesis that by intentionally growing non-financial forms of capital (Human Capital, Social Capital and Natural Capital) a higher level of profit can be achieved with mutual benefits for all stakeholders in the ecosystem.

EoM was first described at length in Completing Capitalism where the main idea of recognizing the value created by strategically investing resources in non-financial forms of capital is presented together with the appropriate metrics [link to eom metrics section].

Related to EoM’s idea and independently developed in April 2014, is Kevin T. Jackson’s Economy of Mutuality, described as “an alternative frame of reference to the dichotomy of market economy and social economy, for inquiry about what business is for and what values it presupposes and creates.”

To date, the EoM proposition has received the attention of an international audience and been exposed and discussed in several international events [ ref EU summit 2018 ],[ ref Lindau], [ ref WEF ][ other Ref .. ]

In 2014, the Mutuality in Business research initiative was created as a partnership between Mars, Incorporated and the Oxford Said Business School with the purpose of testing the hypothesis of EoM and further it’s development as a management innovation practicable by businesses around the world. Since April 2019, a similar research project is on-going with the China European Business School in Shanghai, China with the shared objective of engaging "in academic research into the practical application of EoM in a Chinese business context, conduct related case studies, deliver classroom lectures, and host an annual forum" [ref CEIBS Press Release ].

As a management model, EoM is based on the following pillars [Link following section]:


 * 1) The centrality of the Company Purpose as way to drive the deployment of the Company’s strategy;
 * 2) The orchestration of the relevant stakeholders in the ecosystem defined by the Company’s purpose;
 * 3) Performance metrics beyond financial capital, based on natural, social and human capital;
 * 4) Design of management practices and interventions aimed at growing non-financial forms of capitals;
 * 5) Modes of profit construction (Mutual Profit) that create incentives for managers to fulfil the company’s purpose.

A detailed presentation of the model is provided by Putting Purpose in Practice: The Economics of Mutuality.

Since 2016, Mars Inc., and EoM has organized and run a large, by invitation-only, annual conference at Said Business School, University of Oxford. The conference is part of the Said Business School MBA progam and brings together leaders from all sectors together with academics and the MBA class. The goal of the conference is to bring together thinkers and practitioners interested and active in the discourse on the role of business in society.

EOM is also an independent initiative hosted within the eponymous Economics of Mutuality Foundation.