It was heartening to see the Financial Times (‘the world business newspaper’) wrap itself last week in its call for a reset for capitalism, and a clear statement that ‘business must make a profit but should serve a purpose too.’ As a B Corporation, we’ve committed ourselves to meeting social and environmental targets as well as financial ones. We believe that the best way – and soon enough the only way – to drive commercial value in a business is to manage it according to the needs of all stakeholders and mindful of all externalities. A business that prioritises shareholders over employees, that doesn’t actively seek to reduce its environmental impacts and that doesn’t understand and look to improve its contribution to society – is a weaker business.
As consultants, we’re seeing this shift across all the business sectors we work in. Consumer goods companies responding to changing value sets among emerging generations in relation to social impact, and demands from their retail customers to reduce their environmental impacts or risk delisting; B2B companies finding increasing sustainability requirements in tenders for new work; food companies focusing on the long term health impacts of better nutrition, rather than the short term hit of sodium, fat and sugar; business service organisations looking to attract and retain talent with meaningful work, not just salaries.
As noted elsewhere, investors are increasingly making decisions based on Environmental, Social and Governance (ESG) criteria, reflected this week in the FT’s bold call.