Scott Shane

Starting a business is risky. Half of all new businesses fail to experience a fifth anniversary. And everyone knows that you could lose all the money you've invested in your new company and then some. Those are the obvious risks of trying to be an entrepreneur.

Whatever the reasons, would-be entrepreneurs should be forewarned. Going into business for yourself isn't just risky because your business might fail. It's risky because you might have a harder time getting a job in the future, even if you succeed with your company.

Profitability, growth, and safeguards against existential risks are crucial to strengthening a company's long-term prospects. But if these three factors constitute a company's 'hard power,' firms also need 'soft power': public trust and acceptance, won by fulfilling a company's social responsibility.