Call it wishful thinking, but there is a distinctive “feel good” vibe in the air.
It has been five years since Lehman Brothers collapsed, sparking a massive global financial crisis that many attribute to unbridled corporate greed.
As with all anniversaries, pundits and experts love to examine how far we’ve come since and what lessons have been learned.
But five years in, I can’t help but get a sense that being good – as a corporate citizen and employer – has become more ingrained in the corporate culture. It’s no longer just public relations firms that are extolling the virtues of their clients; companies and employers seem to be presenting themselves as both virtuous and profitable.
A few weeks ago, I stumbled across the Twitter hashtag #keepgoodgoing by New York Life Insurance Co I expected this to instigate the usual cynicism found on all social media sites but the reaction on the twittersphere by employees and the public appeared genuinely enthusiastic. Then I found Visa Canada, whose #goodbusy hashtag also struck a genuine note. Companies are doing more than presenting mere feel-good vibes, and corporate social responsibility isn’t a new trend. Yet this blend of being a good corporate citizen with a strong emphasis on profits appears to be gaining traction.
Harvard Business Review’s Umair Haque believes this is the wave of the future and in his Great to Good Manifesto declared that great companies need to launch good initiatives to stay relevant to their customers. http://blogs.hbr.org/2010/02/great-to-good/ But is good and profitable a sustainable business model? While MBA programs and companies extol the virtues of people, profit and planet, can the corporate culture evolve and embrace a triple bottom line?
Yes, says Phillip Haid, chief executive officer of Public Inc., a Toronto-based agency that advocates for social causes with campaigns to raise money and mobilize volunteers. But only if we stop separating social initiatives from financial performance. “Imagine if companies started thinking about the social impact they wanted to create in the world and tied it to bottom-line performance. The potential impact could be incredible,” he said.
Mr. Haid cites the examples of U.S. shoe retailer Toms, which donates a pair of shoes for each pair sold, and Warby Parker, which follows a similar model for sunglasses. He also notes Canadian Tire’s We All Play for Canada campaign; if done right, he believes it can encourage physical activity for kids while selling products.
“A for-profit company that bakes social good right into its business model and brand can be a huge differentiator and drive sales, [but] the integration of profit and purpose is only successful if the core product is really good,” he said.
It will be up to consumers to decide if this approach resonates. Mitchell Kutney, co-founder of Ottawa-based JustChange, which offers grants to help supoprt initiatives that promote environmental causes, social justice and economic equality.
“Today’s generation does not care to separate altruism from the corporate world as was perhaps initially seen in the division between traditional non-profit and for-profit organizations,” Mr. Kutney said.
He gives as examples Vancouver-based Chimp Technology, which simplifies charitable donations, and New York-based Gradian Health Systems, which equips hospitals in Africa and other developing countries with portable anesthesia machines.
“Both of these organizations have altruism at core of their mandate, and still serve their bottom line,” Mr. Kutney said.
Even if the double goals of being a socially responsible corporate citizen and a profitable venture become more intertwined, it will be interesting to see where having a social conscience survives if profitability stalls.
For Mr. Kutney, there’s only one path businesses should follow. “It is certainly beneficial for a company’s bottom line to be good, but that is a drop in the ocean in light of the systemic and global challenges facing modern society,” Mr. Kutney said.
“The income gap and climate change are two colossal examples that will require committed leadership from all sectors, especially the corporate world, if we ever hope to resolve them, and I can’t think of a better [socially responsible] package than that.”
Leah Eichler is founder of r/ally, a mobile collaboration platform for enterprises. E-mail: email@example.com