Last week I headed over to Hackney to hear from a panel of speakers brought together by OnPurpose, _Social Starters, and Year Here. The focus of the discussion centred around one question in particular: Can business be a force for good in our society?
Simon Gallow from UN Women offered his opinion on this thought-provoking topic by asking the following 3 questions:
- What is good?
“Good” is when the government, business and civil society come together to create social value by being 5 key things: effective, efficient, equitable, inclusive, sustainable. Simon is keen to argue that capitalism and business do not have to be the evils of the world, especially since they have so much potential to do good in society and give something back.
- Why have businesses been bad?
The problem is that businesses have just focused on being efficient and effective, and have neglected being equitable, inclusive and sustainable. Milton Friedman’s statement “The businesses of business is business” is a mentality that started in the 70s which is still often reinforced today. However, this statement is outdated – not just for social reasons, but for commercial reasons too.
Indeed, according to Rupert Pick – founder of Work For Good – there is a profitable need for social responsibility. 70% of consumers will spend more on brands that support causes, as demonstrated by brands such as Ben & Jerry’s, Toms and Warby Parker. Not only is there a consumer-facing benefit, but better businesses attract better employees who are more invested in the company’s growth.
- How can businesses become good?
Firstly, we need to change the narrative that the private sector is an engine of growth and the public sector is just redistributing everyone’s wealth. Good work needs to be done together – not in isolation. Simon wants to change what the measurement of what “value” is. He argues that profit isn’t necessarily bad, but it should not be the end. Instead, it is the means to the end. The profits need to be invested back in people because where else should the money go otherwise?
Secondly, we need to change the time horizon for success. In the last 8 years, CEO tenures have decreased on average from 8 years to 4 years – decision making is getting shorter and shorter. We need to look further into the future and consider the long-term effects of business.
In short, Simon not only agrees that businesses can be a force for good in our society but that they should be!