Can we afford purpose in a recession?
Yesterday I got out of my (virtual) four walls for a panel discussion organised by Pimento, about whether businesses can afford purpose in a recession – though it inevitably explored so much more.
In short, it’s a resounding ‘yes’ from me. The business benefit is clear, with socially driven brands outperforming ones that aren’t, 91% of millennials saying they’d switch to a purpose-driven product over a competitor, and millennials (who will make up 75% of the workforce by 2025) looking for socially responsible employers. Bigger than that, it’s just a better way to be as a business.
To be clear on what I think ‘purpose’ is. It’s the reason for being, beyond profit. It’s how, as a business, you act as a force for good. It’s not just running your business ethically, it’s the north star (or as Beth Pope better articulated on the panel yesterday, the catalyst for change) that drives your whole organisation from the inside, out. It spans the nuts and bolts of how you do business (operations), how you run your business (culture) and how you are a positive force in the outside world (brand). Critically, it’s not just the latter.
What businesses cannot afford to do in this current climate, is get purpose wrong through lack of authenticity or longevity. Here are some of the common pitfalls:
- Your purpose is only skin deep. You risk a consumer boycott if you’re just doing a bit of (vanity) cause marketing that isn’t fully thought through, doesn’t align with your brand and isn’t recognised internally. Delivering on your purpose isn’t always a glamourous advertising or PR campaign. Yesterday, Kate mentioned the example of Mastercard in 2018 with its pledge to donate meals to starving children for every goal scored by Messi or Neymar Jr., which was worse than skin deep and completely missed the mark.
- Your purpose is only embodied in a flash in the pan ad campaign. Sometimes, to act on your purpose, means doing things slower. It might mean running small pilot behaviour change initiatives to test impact. Or it might be working closely with a particular group of people over a longer period before broadening out. Listen and learn as you go. Purpose isn’t a destination; it’s a driver and it’s always moving forwards. And sometimes, as Tony’s Chocolonely have demonstrated, it’s complicated and takes bravery.
- Your purpose isn’t firmly within your sphere of influence as a business. Your reason for being beyond profit needs to be clearly anchored to what you actually do as a business to be authentic. Where can you genuinely have an impact? What part can you play in that wider change?
- Your purpose isn’t lived internally. If your employees feel that the purpose you shout about is incongruous with the culture that they operate in, this will result in internal frustration and becomes a reputational risk. The opposite is the best-case scenario, where individual employees are true ambassadors for your purpose.
- Your purpose isn’t championed at a senior level. A lot of decisions are made in boardroom meetings. It’s important that you aren’t doing things that undermine your purpose (another reputational risk). The ESGs are having a growing significance in the boardroom and becoming more widely recognised as the future of good business. People and planet should sit alongside profit, as the B Corporation movement and the Better Business Act is demonstrating.
- You try to act on your purpose alone. Brands need to leave egos at the door. Your voice won’t be the only one in a particular space. The best brand activists, such as Ben & Jerry’s, collaborate with experts, think tanks, NGOs, and other social enterprises. The change that you want to bring about is often part of a much bigger picture.
You will receive criticisms. Stick your head above the parapet to stand for something, and not everyone will be a fan. You’ll need thick skin and proof of your relevance and impact.
Generally, purpose is receiving a fair bit of flak, and I think that’s because it’s become a marketing or PR buzzword. Some organisations are mistakenly treating purpose like a strapline. Jargon aside, people are savvy and are demanding better from businesses either as an employer or a customer, and they expect action beyond words.
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