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At daybreak on July 11 1804, on a mist-shrouded ledge over the Hudson river — now the ramp-way to the Lincoln Tunnel — a duel was fought for the soul of the capitalist corporation. That duel came about because of quite contrasting approaches to our understanding of boldness in business.

On one side, wielding a borrowed hair-trigger pistol, stood Alexander Hamilton, former US Treasury secretary and aide to George Washington. Facing him was Aaron Burr, US vice-president and founder of the five year-old Manhattan Company.

A cocktail of politics, family history and commercial rivalry had brought them to this point but at the root of it was the menace of the Aedes aegypti mosquito. With Manhattan’s population exploding to 60,000 as the industrial revolution dawned, New York lay on “a latitude of pestilence”, said one doctor. For the previous six years, yellow fever had stalked the city, wiping out 3,000 people in one summer alone.

Apparently to address the crisis, Burr had approached Hamilton with a bold idea. He proposed setting up a company to pipe in fresh water from the pristine Bronx River, rid the city of its ponds of stagnant water and curb the epidemic at its source. Hamilton, a “yellow jack” survivor himself, had joined Burr’s board and persuaded the city legislature to pass an act of incorporation. The Manhattan Company was born, its charter to supply New York with “pure and wholesome water”.

Hamilton, however, missed one detail. In the articles of incorporation, Burr slipped in a clause allowing the company to invest “in any other moneyed transactions or operations not inconsistent” with law and “for the sole benefit of the company”. To Hamilton’s fury, of the $2m raised by virtue of the charter, only $100,000 went on water and the rest on setting up a bank. Instead of a canal diverting the Bronx River, the company just dug a well at Spring Street and Broadway and laid out a few pipes of hollowed-out pine logs. Not until 1842, and under a different water company, did New York get its clean water.

© Martin O’Neill

At stake on the ledge over the Hudson was the very DNA of the corporation. Tracing the ancient origins of corporations — from the 13th century Bazacle Mills in Toulouse and the Stora Kopparberg mine in Sweden, on to the 18th century toll-roads, the canals and the railways — reveals a consistent pattern. Companies have enjoyed the full benefits of incorporation, from limited legal liability, to tax breaks and the ability to raise capital. In exchange, they are expected to solve a problem that matters to society. This is the historic mandate of the corporation.

Hamilton’s shot landed in a cedar tree. Burr hit the target and Hamilton died the next day.

Two centuries later the Aedes aegypti mosquito is wreaking havoc again. In Brazil, the Zika virus that the mosquito carries may have infected as many as 1.5m people and the colliding megatrends of urbanisation and climate change risk increasing not only the disease’s breeding grounds, but also the number of people exposed.

So what is the role of business as we confront today’s threats and challenges? “Technology is not the answer,” comments Kentaro Toyama, the former Microsoft research director. “It is the amplifier of intent.”

The real revolution, the one that will galvanise the passions and talents of a millennial generation, is not technological but a revolution of intent. It is about returning to the centuries old idea that the purpose of business — and its licence to operate — is not growth for the sake of growth. It is to solve a problem that matters.

What does that look like?

Well, it looks like a number of the nominees for this year’s Boldness in Business awards — from M-Kopa, delivering SIM-enabled solar powered lights to those with limited access to power, to Cellectis using gene-editing enzymes to provide low cost cancer treatment, to Everledger’s Blockchain-certified conflict-free diamonds.

These companies grow by delivering solutions to the pressing economic, social and environmental problems and crises that we face.

They are the stuff that Hamilton, the guy on the US $10 note, would want any bank to lend to.

Copyright The Financial Times Limited 2017. All rights reserved.
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