We Need to Talk About Purpose
The coronavirus pandemic is a not-so-subtle reminder that healthy company profits are a byproduct of a healthy society, and vice versa, highlighting that purpose is no longer a decorative corporate artefact, it is the future of business.
As I outline in Connecting Profit With Purpose, responding to Hurricane Katrina led a major company CEO to an epiphany, transforming the way the company helps workers, engages with suppliers and sources energy. The CEO realised that a profit-only approach leads to a dead end, and a focus on the purpose helps them achieve their financial goals.
Now is the perfect time to re-think the role of purpose and there are three (3) levels to this conversation.
1. Profit Growth
Business gets a bad wrap. It is usually is well deserved. However we do tend to overlook the positives and the massive potential for business to do good.
I’m not talking about donations to charities, volunteers packing boxes, responsible sourcing certifications or cause-related marketing, I’m talking about contributing to positive societal outcomes through core and profitable business.
As far back as George Cadbury in the late 1800s, we’ve seen leading companies putting these principles in action. George bought land surrounding his factory and built affordable accommodation for workers on the premise that a happy and healthy workforce would be more innovative and productive for his business. He connected profit with purpose.
The power of core business in effecting change is underestimated. At this very moment, we are seeing supermarket, postal and logistics providers teaming up to deliver basic food boxes ($80) to elderly people isolated at home. This is not corporate foundation work, it comes from the heart of the business and leverages their systems, relationships and expertise.
Linking profit with purpose requires the right mindset, because it doesn’t work without a very clear North Star, or reason for existence. Companies that continue to define themselves by activities or shareholder return targets are losing their way; on current trends, they will not endure.
2. Professional Development
After completing university I worked in the insurance and investment management industries for 19 years. I was concerned about climate change and the impact it would have on our lives as well as our investment portfolios. However the need for life-change and desire to make a difference that saw me exit the industry to focus on assisting businesses, community organisations and government with collaborative challenges.
While I wouldn’t change a thing, soon into this new journey it dawned on me that most of us can make a far greater impact through our day job than we can outside of it. You may volunteer or help with fundraising in your spare time, however not many of us have much spare time.
What if delivering on a social purpose was integrated into everything you do?
The secret to achieving it revolves around linking profit with purpose. It requires new skills, including the application of shared value principles, and the how-to needed to make it work. It’s frustrating when people say “business must do good” when they don’t offer up any workable solution, one that is congruent with the profit motive.
If you’re equipped with the right mindset and skills, what else is important?
3. Personal Wellbeing
What do you care about?
High profile companies are, quite rightly, obsessed with helping their leaders and executives achieve work-life balance, personal wellbeing and gaining job satisfaction. And that’s all fine … unless it means leaving your personal values at the door every day because the relentless pursuit of financial goals means you’re doing harm to someone, somewhere; or you have questionable sales practices, flaunt rules and regulations, use creative accounting, misreport facts, exploit natural resources, put the screws on suppliers, witness bullying and harassment, have exceedingly poor governance and so on.
Having a clear and meaningful purpose – one that’s pushed from the top down and built into KPIs from the bottom up – is a powerful way to focus your resources and efforts. I’m not saying it’s easy, as the Chair of insurance multinational, IAG, Elizabeth Bryan notes:
If you’re confused about your purpose it’s hard to do anything.
She went on to say it requires authenticity, passion and commitment to instil a renewed purpose across an organisation, and don’t bother trying if you’re not prepared to give it 100 per cent.
Talk About Purpose
Right now, we’re in unchartered waters. Many organisations are battening down the hatches and focusing on day to day survival. I get that. However, if you’re reading this article it may mean it’s the perfect time to reflect and review on where to from here?
Some say that connecting profit with purpose is impossible, that they are two opposing forces. I disagree. They reinforce each other when done well. Putting purpose front and centre pays off in terms of personal wellbeing, professional growth and profitability.
Your next challenge is to translate talk into action.
Phil Preston is an expert in aligning profit with social purpose and the author of of Connecting Profit With Purpose. He can be contacted via phil@philpreston.com.au or +61 408 259 633.
