Myth-busting purpose: unpicking businesses most misunderstood movement
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Shared value, conscious capitalism, triple bottom line, purpose driven… however it’s being described from company to company, this new, holistic approach to business is gaining momentum globally.
However, as is the case with any significant paradigm shift this newest iteration of capitalism comes with some myths and misperceptions attached that need clarifying (ironic, given the level of accessibility and transparency that results from this approach!).
In his recent article for Fast Company, Tripp Baird points out that companies that don’t update their business practices are significantly less likely to thrive. Meanwhile, those that harness the power of purpose are capturing significant value and creating meaningful competitive advantages along the way.
Baird myth-busts common misconceptions that the movement faces:
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Many of the world’s largest corporations are also tuning in—modifying production, distribution, sales, employment policies, and aggressively re-aligning around values-driven brands—with an eye towards sustainability and maximizing returns in the process.
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While the fundamental purpose around which a company is built can yield compelling opportunities, equally, if not more important, is how a company conducts its business.
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Research shows that companies who invest in a holistic stakeholder approach—through policies benefiting shareholders, employees, local communities, consumers, supply chain partners, and the environment in concert—perform significantly better in the long term than those who don’t.
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The millennial generation‚—representing $1.3 trillion in annual spending—engages with brands far more extensively and personally than older generations, and expect their values to be reflected in brands they purchase.
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In the end, each of these constituents (personal, social, and environmental regeneration. Human welfare, environmental sustainability, employee happiness, and social benefits) is inherently tied to long-term financial success. Without shared value creation across these areas, there can be no long-term profitability.
Ultimately, Tripp explains, “businesses built with purpose and run by inspired leaders can change the world and improve lives in the process, all while creating outsized financial returns.”
A compelling pitch for any business, wouldn’t you say?
At Purpose Agency—helping businesses to work with purpose on a daily basis—we’ve put together a myth-busting list of our own: an on-the-ground guide, if you will, that helps to put some of the more basic misperceptions to bed:
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Purpose isn’t a buzzword—it’s proven to make organisations work better in every way.
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A well-defined and articulated purpose is equally relevant (and important) to SMEs as it is to fortune 500 companies.
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This is not a process of synthesis or layering—but excavating and revealing.
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Social-purpose, higher-purpose, greater-purpose… purpose doesn’t need a superhero cape to be powerful.
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Purpose is an echo. From an organisations core, purpose radiates clarity, honesty and meaning into the world where it lives—and to everyone who benefits from it.
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It’s the way you engage, act and work. It’s the living, breathing force that powers your business activities and decisions.
By identifying what purpose ‘isn’t’, we can help businesses see it for what it really is: the new business imperative and the key to a more impactful and successful future.
For an in-depth look at the myths Tripp Baird identifies, check out his article at Fastcompany.com