Why do you do business ?- in search of the triple bottom line
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As a business partner with over 20 years’ experience, I've worked with and advised organisations large and small. I'm often asked the question, what are the biggest challenges facing businesses now and in the future?
My response to this question is clearer now than ever before. Whilst there are many concerns that should occupy our thoughts, there is no greater threat to the prosperity of business owners and shareholders than the very real, very present threat of the climate crisis for our planet.
Business leaders and owners, understandably want to ensure they're fit enough to meet challenges head on and prosper. Of course, revenue growth and more importantly profit, are critical to realising shareholder value. Therefore, it makes sense businesses take steps to ensure that value can continue for as long into the future as is humanly possible. The only way to guarantee this, is to ensure any business strategy incorporates sustainable practices at it's core.
“…revenue is vanity and profit is sanity…purpose is humanity”
Whilst realising shareholder value and the associated wealth can be powerful motivators to those closest to the source of that output, it is just that, an output. What is the input that generates this? When was the last time you were asked why you do business? What purpose does your business serve for you; your workers; your local community; or the wider world?
As the old adage goes - revenue is vanity and profit is sanity - and I’d add to this, that operating with a clear purpose to be a force for good, is humanity.
There are many initiatives to support companies in identifying a more holistic approach to making money, such as the UN Sustainable Development Goals (SDGs) and B Corps movement.
Jim Stengel Co., “Purpose,”
So, why does a business with a clear purpose to do good, outperform those for which the answer to the question of why they do business is less compelling?
People have a powerful influence over this.
Over the last 25 years, people have increasingly sought more meaning in their work. Employees are approximately 20% more productive when they are highly engaged in their work. With over 80% of employees seeking meaning in their day-to-day work and over half energised by knowing their employer has a positive impact on the environment and their local communities.
What about your customers?
As the graphic below from Deloitte Insights shows, over a quarter of your customers could be making a decision on whether to purchase from you or work with you based on how your company treats your own people. Add to this 1 in 5 will be weighing up your impact on the environment before parting with their money, and a similar proportion wanting to see how you benefit your local community before deciding to invest with you.
Many organisations have been taking positive steps, investing in the future of our planet, looking after the wellbeing of their people and supporting their communities. I’ve worked with micro-business owners, CEOs of SMEs and senior leaders in larger organisations who have realised the intrinsic value of being driven by a compelling purpose. When asked the question why they do business, they speak with passion and energy about their mission to be a force for good. In so doing, they ensure they gain or retain a competitive advantage and are able to benefit from the output this generates as a by-product.
These organisations have identified their triple bottom line. People, Planet, Profit. One cannot exist in the long-term, without the commitment to the other two.
So, if you're a business owner or senior leader in an organisation, it makes a compelling case to review your strategy and business plans, and do so urgently!
The good news is, The HR Agency can help - we work with people on purpose.
We offer a consultancy service that works with you to evolve your purpose-driven business and support you in discovering your triple bottom line.
Get in touch to see how we can help.
