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Spring 2016 stories

Laudato Si’ and Inclusive Capitalism

Excerpt from Public Lecture, “Our Future on a Shared Planet” Conference, Santa Clara University1
By John Denniston

By John Denniston
Chairman of the Board, Shared-X

Many in the media have portrayed Pope Francis’s Laudato Si’ as an environmental call to action, and while that is true, it is only part of a much larger picture the pope is painting. He also confronts social injustice: “We are faced not with two separate crises, one environmental and the other social, but rather with one complex crisis which is both social and environmental” (§139).

The root cause of environmental degradation, Pope Francis writes, is an ethical and cultural decline worldwide, characterized by individualism and self-centered instant gratification. In Laudato Si’, Pope Francis urges all of us to pioneer solutions that combat poverty, restore dignity to the marginalized, and protect nature—all of these tasks, not just one.

Some media coverage of the encyclical has been supportive and some not. I’d like to begin my remarks today by using the adverse reactions as a prism of sorts to help us see more clearly how an alternative theology has emerged recently in our culture, and also to see more clearly the challenges of reconciling this new creed with Catholic social teaching.

Photo by Steve McCurry. Artwork by Obscura Digital

I’m going to use one particular critique as a proxy: an op-ed by the prominent journalist George Will, the headline of which reads, “Pope Francis’ Fact-free Flamboyance.”2

Will argues that the pope doesn’t understand how the free market has lifted millions out of poverty, how environmental damage can be fixed, and how his own policy proposals will hurt the poor. (As an aside, I have to say, I wonder how many critics have actually read the encyclical and not just the highlights in the newspapers.) George Will lectures the pope, claiming that only economic growth has ever produced broad amelioration of poverty. However, if you read the encyclical you’ll discover that Pope Francis is well aware of this fact. Truth be told, the pope is even stronger on this point than Will, marveling at the good done by inventions born of human ingenuity. Laudato Si’ tells us we should all rejoice at the potential to reduce human suffering even more going forward. 

Here’s another mischaracterization. Will tells us the pope is proposing dangerous public policies that are destined to hurt the poor. Again, those who have read Laudato Si’ know it’s not a policy manual; nothing in the encyclical even approximates legislative recommendations. To the contrary, the pope explicitly says that the church is not a substitute for the political system. Regarding the environment, Will argues we should overlook fossil fuels’ externalities because they powered economic growth in the past, and in any event we will likely be able to reverse any significant environmental damage. Will seems unable to envision a future in which energy is both a driver of prosperity and clean. In fact, we’re moving in precisely that direction today.

Like so many of the critics, Will demonstrates a limited understanding of the social dimensions of the encyclical. Pope Francis isn’t saying capitalism is inherently bad. He’s urging us instead to adopt a more inclusive form of capitalism.

So what do we see when we look through this prism of opposition? We see that a segment of our society has come to a religious-like belief that the invisible hand of the market achieves optimal outcomes across the board—economic, social, and environmental. A trifecta of perfection, if you will. George Will captures well the zealousness with which this new religion has taken hold at the close of his article: “Americans cannot simultaneously honor [the pope] and celebrate their nation’s premises.”3 In other words, the two religions in question—Catholicism and the Church of Market Fundamentalism—clash and are irreconcilable.

Will and other critics try to strengthen their case by portraying Pope Francis as a radical, as an outlier, and as a pope who’s making up his own catechism and in so doing taking the church wildly off course. That’s simply not the case. In Laudato Si’, Pope Francis is channeling mainstream and long-standing Catholic social teaching, very much along the lines of papal encyclicals or other statements published by Pope Paul VI in 1971, St. John Paul II in 1991, and Pope Benedict XVI in 2007.And all of those documents can trace their heritage, in part, to the Rerum Novarum, issued by Pope Leo XIII 125 years ago in 1891.

And so I pose to you a question, which perhaps doesn’t have a clear answer. What has changed? Why the shrill reactions now to Pope Francis’ social justice and environmental reflections when the pope’s predecessors made the very same points? 

We could organize days-long seminars on this question, I think. Pope Francis points to one potential cause: a seismic shift in our culture toward more and more individualism. I’d like to propose two other potential causes. One is political extremism, resulting in part from the hollowing out of the middle class due to globalization and automation. The second is the series of selfreinforcing special interest echo chambers, so plentiful on digital media now, thanks to the low cost of information distribution on the Internet.

I’d like to conclude by considering one of the many tangible beacons of progress that address the social and environmental dimensions of the larger crisis Laudato Si’ describes. In his encyclical, the pope highlights an opportunity to help small farmers worldwide through innovation. Poor farmers are a worthy target, as 70 percent of the world’s poor live in rural areas where agriculture is basically the only economic opportunity.

For nearly every crop, farmers in developed countries substantially out-produce their emerging country counterparts. Why is this? Mainly because they have two things emerging country farmers don’t—access to capital and advanced, sustainable farming techniques.

I serve as Chairman of the board of a company called Shared-X. Our business plan is to collapse that yield gap by deploying advanced, sustainable farming techniques in remote areas of the emerging world. We are a for-profit company with three goals: generate profits, lift poor farmers out of poverty by integrating them in the prosperity that we create, and deploy environmentally sustainable farming techniques. Our formula is to grow high-value specialty crops such as organic bananas and specialty coffee on high-potential farmland. We optimize production by bringing to these regions proven technologies. Where feasible, we sell our crops directly to end users, skipping the middlemen along the way and getting a premium price. In our mixed model we buy midsize farmland from wealthy families and then engage with our small holder farmer neighbors and share our best practices with them. The name “Shared-X” stands for the shared exchange of capital, know-how, and prosperity. 

Shared-X is but one of many examples. There’s a lot of momentum right now around developing an impact economy. A Harvard Business School professor has gone on record as saying impact investing will become the next venture capital. In the summer of 2014, Pope Francis hosted a seminar in the Vatican on impact investing.

I will close with a reflection, almost a meditation, which Pope Francis offers towards the end of Laudato Si’. It is very good food for thought. “When we ask ourselves what kind of world we want to leave behind, we are led inexorably to ask other pointed questions. What is the purpose of our life in this world? Why are we here? What is the goal of our work and all our efforts, and what need does the earth have of us? We need to see that what is at stake is our own dignity. Leaving an inhabitable planet to future generations is first and foremost up to us. The issue is one which dramatically affects us, for it has to do with the ultimate meaning of our earthly sojourn” (§160).


John Denniston is the president of the Society of St. Vincent de Paul of San Mateo County, a nonprofit organization focused on poverty, and a former partner at Kleiner Perkins Caufield & Byers, a venture capital firm. He co-founded and co-ran the firm’s $1 billion Green Growth Fund. He was also a managing director and head of technology investment banking for the Western United States at Salomon Smith Barney. Denniston is currently the chairman of the board of Shared-X—a company that aims to improve agricultural productivity in Latin America while producing attractive financial returns for its investors.



  1. John Denniston, “Laudato Si’ and Inclusive Capitalism,” public lecture, Our Future on a Shared Planet: Silicon Valley in Conversation with the Environmental Teachings of Pope Francis conference, 4 November 2015, Santa Clara University.
  2. George Will, “Pope Francis’ Fact-free Flamboyance,” oped, The Washington Post (18 September 2015), available at www.washingtonpost.com/opinions/pope-franciss-factfree-flamboyance/2015/09/18/7d711750-5d6a-11e5-8e9edce8a2a2a679_story.html, accessed 22 March 2016.
  3. Ibid.
  4. See references in paragraphs 4, 5, and 6 of Laudato Si’. Pope Francis, Laudato Si’ On Care for Our Common Home, encyclical, (24 May 2015), available at w2.vatican. va/content/francesco/en/encyclicals/documents/papafrancesco_20150524_enciclica-laudato-si.html, accessed 22 March 2016.

Photo Credits:
John Denniston - Joanne Lee
Market Ticker - MJ Prototype/Shutterstock 

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