Business, Society, and Planet

This article explores the six forms of capital used by businesses and their importance in achieving sustainable growth. It discusses the significance of financial, human, intellectual, manufacturing, social, and natural capital in business processes and organizational objectives. The article emphasizes the need for organizations to synchronize these forms of capital to achieve high productivity and dominance in the market.

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Business, Society, and Planet
Title: Business, Society, and Planet
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Business, Society, and Planet
Table of Contents
Introduction......................................................................................................................................2
The Six Forms of Capital used by Businesses.................................................................................2
Conclusion.......................................................................................................................................5
References........................................................................................................................................6

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Business, Society, and Planet
Introduction
Capitalism can never be only about financial capital, but it includes various other forms
too. The popular corporate beliefs do not incorporate the numerous types of capitals that an
organization makes use of. Financial investments are very crucial when it comes to executing
business processes, but companies must never stand short of machinery, human labor, energy,
water or even the community. Modern organizations are trying to adhere to the various theories
laid out by multi-capitalism. Multi-capitalism proves to be a precise definition of the economic
system and it is also a well-structured recipe for sustainable growth.
The Six Forms of Capital used by Businesses
Organizations today are making use of six types of capital while executing in various
business processes and ensuring prosperity at the same time. All the six types of capital are
equally important and they must be synchronized with all the business processes and
organizational objectives in order to achieve high grounds of productivity and dominance in the
market (White, 2015). It intrigues me to a great extent that businesses in the modern market
cannot rely only upon financial investments in order to ensure prosperity and success over the
competitors.
Financial capital is extremely important because it can get the perfect head start required
by a business. Financial capital arrives from two sources which include equity and debt. Debt
capital is nothing other than the funds that managers borrow and they have to return everything
at a particular date. Funds are usually generated by the sale of stocks (Turner & Gianiodis,
2017). The equity capital must not be returned, but various stakeholders and investors can expect

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Business, Society, and Planet
a certain rate of return. I prefer to consider financial capital as one of the base pillars upon which
an organization can stand, even though this base pillar’s importance is being radically challenged
by other requirements. Financial capital is highly important because a business cannot begin or
invest in the market properly without the right economic resources.
There also exist human capital and it is a much less noticeable concept. The contributions
of human capital can actually determine the success rate of an organization and this is the reason
why it is not less important than the other forms of capital any organization uses. All the
employees working together in the most synchronized manners possible actually give rise to
human capital and it can be more than just difficult to measure such high potency levels in a
quantitative manner (Tebekin, 2018). I stand willing to believe that the domains of human capital
must be revisited by every authority in a company. I also understand that the quality and
efficiency of the human capital can be controlled in the recruitment and selection sessions
conducted by the Human Resource Department of an organization. Companies today are
understanding that the well-being of employees is extremely crucial and it can benefit the
organization in the long run as well.
Intellectual capital must also be paid attention to and it refers to the knowledge, skills and
business training possessed by the employees in the organization that completely ensures
competitive advantage in the market. Intellectual capital can easily be defined as the arrangement
of informational resources (Smirnova, 2015). It proves to be extremely important, according to
my perspective, as the modern market depends more upon information and intelligence than
ever. Organizations can make use of intellectual capital in order to earn profits, improve the
business and develop new products at the same time as well. Intellectual capital can at times

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Business, Society, and Planet
ensure high grounds of profits in the competitive market when the company procures the right
information at the right time as well.
Organizations also have to deal with manufacturing capital where all the material
resources used in the processes of development are included in the final records. I consider raw
materials as the primary ingredients that an organization must control and monitor in order to
introduce excellence in the final product. These resources have a distinctive economic value in
the entire company and this is the reason why it can also be referred to as the indirect financial
capital present in an organization (Madhavaram & Hunt, 2017).
Social capital also arrives at the forefront and in financial terms, this form of capital can
be easily referred to as the social relationships and various networks that can help when it comes
to balancing the economic capital for expansive growth in the organization. This growth,
however, is financial in nature and various tangible along with non-tangible assets are paid
attention to in order to achieve high grounds of efficiency (Johnstone, 2015). Information,
financial support, and even innovative ideas are easily included in the social capital and they are
termed as valuable resources as well. The intangible assets in a company have always intrigued
me because I have always preferred to identify them as the central resources that can push a
company towards heightened limits. I understand that franchises, copyrights, trade names,
trademarks, and patents can be considered as some of the central intangible assets.
Natural capital in an organization refers to the stock of natural resources that are saved
and held back by the organization (Bower, 2015). These natural resources can include water or
oil. Within the financial statements and the annual reports, the natural capital possessed by an
organization must be included. It is quite obvious to me that managers in the organization must

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Business, Society, and Planet
also try to obtain the appropriate certification for all the natural capital commodities in order to
arrive at appropriate figures. Natural capital and its assessment become extremely important for
organizations that primarily deal with energy providing services, but other companies must also
try to evaluate all corners of the institution in order to better understand the natural resources that
they do possess (Birru, Runhaar, Zaalberg, Lans & Mulder, 2018).
Conclusion
All six forms of capital proved to be extremely essential when it comes to ensuring high
grounds of efficiency and productivity in an organization. Authorities cannot only depend upon
the financial capital because the other resources and aspects must be paid attention to in order to
achieve the highest form of synchronization. I have come to the terms that a business will be able
to succeed promisingly in all the domains of the market if the six types of capital are utilized and
maintained with the highest forms of attention. Most organizations prefer to focus on
investments, financial resources, equity, and debts. Modern researchers are increasingly trying to
stress upon the other domains through which institutions can gain significantly if they account
for the necessary extents of productivity.

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Business, Society, and Planet
References
Birru, W., Runhaar, P., Zaalberg, R., Lans, T., & Mulder, M. (2018). Explaining Organizational
Export Performance by Single and Combined International Business
Competencies. Journal Of Small Business Management.
Bower, J. (2015). Redefining business models: strategies for a financialized world. Business
History, 57(6), 947-949.
Johnstone, D. (2015). Information and the Cost of Capital in a Mean-Variance Efficient
Market. Journal Of Business Finance & Accounting, 42(1-2), 79-100.
Madhavaram, S., & Hunt, S. (2017). Customizing business-to-business (B2B) professional
services: The role of intellectual capital and internal social capital. Journal Of Business
Research, 74, 38-46.
Smirnova, D. (2015). Problems of sustainable business development industrial
enterprises. Business Strategies, (1), 5.
Tebekin, A. (2018). School of human resource management as the basic for the development of
modern business strategies. Business Strategies, (9), 03-07.
Turner, T., & Gianiodis, P. (2017). Entrepreneurship Unleashed: Understanding Entrepreneurial
Education outside of the Business School. Journal Of Small Business
Management, 56(1), 131-149.
White, M. (2015). Critical success factors for enterprise search. Business Information
Review, 32(2), 110-118.