Simon McEvoy has a bold vision for the future. ‘Purposeful Businesses’, private sector organisations that have have a strong socially valuable element to their activities, are best placed to solve the problems of the future.
Charities will not become redundant, but they are too fragile and at risk from rapidly changing financial tides.
“Before founding my own consultancy business, I worked in marketing agencies for about 8 years. I used to joke that the purpose of my job was to ‘make greedy people richer’. Sadly there was more than a shred of truth to that line.
As part of a corporate organisation I had the opportunity to ‘give back’ to society through a range of CSR-type activities. Running a fun-run, holding a bake sale, or giving some time up to some community work. Often these were coordinated by a charity partnership, usually decided at boardroom level.
Occasionally we were granted time to help a charity we felt passionately about with some pro-bono work. This was often the most meaningful and enjoyable work I did. However, the unpleasant compromise was clear: do something meaningful and positive for the world, voluntarily and for free, then go back to paying my mortgage and providing for my family by making ‘greedy people richer’ again.
Frankly it was a choice that I wasn’t comfortable with at all.
And it’s a compromise that many people of my generation (Millennials, if you will excuse the awful term) are torn between. They can go and work for a charity, possibly ending certain career ambitions and taking a big pay cut. Or they can stay in the corporate sector and sprinkle some free time or money at charities to try to add some meaning to their jobs.
This separation of ‘wealth creation’ and ‘social value creation’ is clearly not working for many people. And indeed, it’s not even working for society.
In a capitalist society the power to influence positive change lies in two places – spending and accumulating money or a democratic mandate. Charities know this, so their theory of change usually relies heavily on raising corporate or private donations and government lobbying.
However the problem with this model of separating wealth accumulation and ‘doing good’ into different organisations is it makes the ‘doing good’ part hugely unsustainable and vulnerable to financial downturns, as has been seen by crises in a number of high profile charities over the last few years.
It also can create competing incentives, where the ambitions of social change agents and powerful business leaders are seemingly at odds with one another.
In light of all this, a new model emerges, that of ‘Purposeful Business’ – a corporate strategy which uses the creation of social value as an orientation point for commercial growth.
Is Purposeful Business just a fanciful notion? Absolutely not, this movement is already strong and continues to gather momentum.
Global organisations like Patagonia, Ben and Jerry’s and Ella’s Kitchen have long had a core purpose and ambitions which far transcend simply making money. They continue to make tough choices, even occasionally making a loss on some products, in order to fulfil their Purposeful goals.
Entire business communities with strict accreditation systems like B-Corp have been developed to clarify what being a Purposeful business really is, and to give enlightened customers the confidence they are not being duped by ‘green-washing’ or CSR.
What’s exciting about Purposeful business is that in many cases, the scale and depth of social impact is far greater than the charitable sector could ever hope to achieve.
Ella’s Kitchen can have a far greater impact on toddler nutrition than any children’s charity, as they can simply change their recipes. Businesses like cleaning company Method can have a far greater impact on the environment with their non-toxic cleaning products than any campaigning on behalf of green charities, because the impact is direct, actionable and sustainable.
Equally excitingly, these businesses are ‘built to last’, as business gurus like James Collins and Jim Stengel have proven in their analysis of thousands of successful organisation over decades. Those that have a strong social purpose tend to greatly outperform the markets and the competition. They are also better places to work, with more productive, engaged and happy employees.
Over the coming years I see the role of business in society changing, from that of ‘wealth creator for the few’ to ‘value creators for the many’. Of course, charities will still continue to play an important role, perhaps as strategic partners for businesses that want to put social change at their core, offering advice and expertise in complex areas.
But for social change to be powerful, wide reaching and sustainable, we need to enrol the world of business in the exciting opportunity Purpose offers to grow and thrive by being a positive force in the world.
Simon McEvoy is the Co-Founder of Purpose-driven Growth Consultancy Three Point Zero (www.threepointzero.org).
Agree with Simon? Do you have something to say about the Purpose-driven movement? Do you believe there are better, or alternative solutions? Tweet at @simcevoy or #FutureGood . Write your own response to this article and let us know, or comment below.