We feel that a particular set of leadership factors working together – namely Purpose, Plan, Culture, Collaboration and Advocacy – are what will underpin the best approaches we could take now and into the future. These will be, without a doubt, the essential qualities for corporate sustainability through to 2030 and beyond. Let’s take a closer look at these five key leadership factors, with a focus on Purpose.
Purpose: WHY we do what we do? Why does the business exist? For too long we have followed the mantra that profit maximisation and shareholder value were the only reasons for the existence of a business. This way of thinking elicits a vehement ‘No’ from us: for a business to exists, it must be Purpose-driven – in order to maximise stakeholder prosperity and value. Purpose also must be real. An expert on Millennials, Generation Z and the impact of purpose and sustainability, Jeff Fromm pointed out in an article in Forbes that: “Purpose isn’t profitable when it’s disingenuous. It must be real. In this age of digital transparency customers can see through it and will redirect their spend elsewhere.”
He cites Unilever as a good example where its “Sustainable Living” brands – such as Knorr, Dove and Lipton – are growing 50% faster than its other brands and make up more than 60% of the company’s growth, thereby showing that it is certainly possible to balance Purpose with Profit.
The evidence also shows that people who work for organisations with a purpose that they believe in, and buy into, will stay longer, be happier and perform better. 2020 Glassdoor data for Unilever in the UK gives the company a rating of 4 stars out of five, with 86% of employees saying that they would recommend the company to a friend. The Glassdoor average is 56%. Purpose makes a huge difference. So organisations that link their Purpose to sustainability – and who can prove that they are genuine in doing this – stand to benefit more than those who don’t.
Purpose – and with it the idea of purpose-led organisations – is emerging once again after a surge some ten or so years ago following the Global Financial Crisis. What’s important for us to notice is that the presence of purpose centre stage in corporate strategising today might be the start of a repeating pattern akin to what happened in the aftermath of the Global Financial Crisis.
At that time, people welcomed the potential to do things differently and for a year or two it seemed that might happen. But for the most part, in fact, organisations didn’t change or mend their ways. So if the pattern were to repeat itself, we might start to see purpose waning in intensity in about five years’ time. We need to make sure that doesn’t happen.
To do so will require advocating for a different kind of leadership – and different kinds of behaviours – to ensure that purpose stays at the heart of organisations and that we continue to agitate to make the workplace more human while at the same time achieving our organisational and business objectives.
As a Deloitte Insights article puts it: “Purpose-driven businesses truly embed purpose in every action, aiming to leave an enduring impact on people’s lives. Increasingly, customers are looking to engage with companies that help them achieve their goals. Whether it’s Kellogg’s aim to ‘nourish families so they can flourish and thrive’ through nutritious breakfast cereals; Patagonia being “in business to save our home planet”; or Sumo Salad aspiring to “make Australia a healthier and happier place”—orienting business around purpose can help companies drive their operations toward outcomes people value, and in turn, deliver what stakeholders value.”
Certified B Corporations are also a new kind of business that balance purpose and profit. They are legally required to consider the impact of their decisions on their workers, customers, suppliers, community, and the environment. This is a community of leaders, driving a global movement of people using business as a force for good.