In the last financial crisis, certified B Corps, businesses guided to deliver social and environmental outcomes and conscious culture, were found to be 63% more likely to survive the down turn than other businesses of a similar size.
Kassoy argues that B Corps are better prepared to weather crises “because those companies were more resilient. They had stronger relationships with their workers, or their customers, or through their supply chains, that allowed them to make it through. I hope that we’ll see something similar this time around.”
Nell Derick Debevoise (2020), Founder and CEO of the B Corp, Inspiring Capital, is of the same view. She identified four themes that highlight why purpose-driven businesses are also faring better in COVID-19 environment and why purpose is a must have for survival. This is my take on them and I have added one more:
Being purpose-driven makes innovation fast and effective
One of the reasons purpose-driven businesses do perform well is because they have cultivated a values-based connection with their customers, clients and communities.
They also operate with a strong social licence to operate by acting with integrity – making decisions and acting in alignment with their purpose and values. By innovating on values, these businesses maintain that relationship in the market and with customers.
They also can identify new offerings because they start with this question: “How can we best serve the interests of the time, drawing on our strengths.
Focusing on how you can serve with your strengths flattens hierarchy and enables flexibility and agility
Another is the willingness to move to distributed leadership models, enabling them to tap into the collective intelligence of their organisation to solve challenges and innovate. This flexibility is critical to weathering crises and responding quickly to changing market needs.
This does require strong collaboration skills underpinned by openness to ideas and moving with strengths within a business. Role fluidity can create emotional discomfort, so when roles do change, it is important to have a culture that values everyone’s contribution to help people feel safe and connected.
Focusing attention on interpersonal connection, cultivates trust and the ability to move with focus and at speed.
Being inherently driven to do the right thing for all stakeholders, enables you to maintain integrity
Purpose-driven businesses, like B Corporations, are inherently designed to do the right thing. They genuinely strive to be values driven, they deliver to the increasing demands by employees, consumers, and investors to deliver positive social and environmental outcomes.
At this time, when companies are expected to be even more service oriented and benevolent, a B Corp’s natural response is to act with noble intentions, with values-based decision making as a habit, rather than something done in good times.
Acting with integrity to your guiding north star and values during difficult times, builds your reputation as an ethical leader and business.
Being caring and human-centred (as well as for the planet) enables to embrace changes to create a culture of belonging and inclusion
The willingness to actively create deeply human workplaces, where people are respected and valued, and can bring their whole selves to work, equires courage to face into the mirror and reflect how close and how far we are, personally and collectively from this idea
Developing a conscious culture is one of the core tenets of a conscious culture that John Mackey, CEO of Wholefoods Markets, writes about Conscious Capitalism: Liberating the heroic spirit of business. It involves creating human-centric workplaces that respect and value individuals, the community, and the environment.
At one level, this means embracing flexible working. With COVID, Atlassian, a software company that has as its purpose to unlock the potential in any team, has announced that their employees never have to come back to the office again, embracing radical flexibility. This decision has put themselves squarely in the shoes of their customers, who are working in teams in WFH/WFA (working from anywhere) environments.
There are risks, but also opportunities to tap into talent wherever it is and recognise that every employee is part of a larger system of relationships and needs. Atlassian, in the same breath as making this decision, also stated their commitment to creating a workplace where belonging and the magic of connection can flourish. The two can coexist, with good will, openness, and employee commitment to making it work. Getting comfortable with that and embracing the conversation to consider what work looks like going forward, is foundational to performance and long-term resilience.
Going deeper, creating inclusive workplaces means embracing the conversation focused on discrimination, specifically becoming anti-racist. Lata Reddy, senior VP of inclusive solutions at Prudential and chair of the Prudential Foundation who guides Prudential’s approach to addressing structural racism says that the first step in creating systemic solutions to address racism, is to “deeply examine how the institution you represent contributed to today’s injustices.” In addition to community focused actions (investments in public school education, local entrepreneurship, housing, and financial security), Prudential has turned the mirror internally. (Read more)
To these four themes, I would add one more:
Standing by fairness in remuneration, supports connected relationships by people feeling valued
Fair pay is a characteristic of B Corps that Kassoy says is another characteristic that underpins discretionary effort and commitment. It is a principle of equity that sets the standard of limiting the distance between the largest and smallest pay packet. This principle brings a sense of fairness to the way money for contribution is shared in a business. It addresses straight on in a transparent and just way, one of the key elements to human motivation and performance – being valued. Money is one signal of that.
At a practical level, within the current COVID crisis, Kassoy points out that when people are not paid well enough, they are unable to save reserves upon which they can draw during a crisis, personal or collective, or fund their own resilient future. Living pay-check to pay-check is not safe, dignified, or fair.
The other element to fair pay, is the relationship of a purpose-driven business to money and success. B Corporations have as part of their mission to redefine success in business, which is more about mutual thriving and reciprocity:
The B Corp community works toward reduced inequality, lower levels of poverty, a healthier environment, stronger communities, and the creation of more high quality jobs with dignity and purpose. By harnessing the power of business, B Corps use profits and growth as a means to a greater end: positive impact for their employees, communities, and the environment.
What lessons can we derive from these themes for leading in changing times?
These themes hold a key lesson for what it takes to lead and build back better with purpose at the heart of your business, partnerships, collaborations, projects, organisations. It means that values that enable the mutual thriving and dignity of all need to take shape in every nook and cranny of a leaders’ head, heart and hands.
- What do you stand for?
- What values do you hold?
- How are you living them?
- Are you building a resilient and fair social contract?
Building and operating a purpose-driven business requires knowledge of the business models, yes. More importantly, I would argue, it requires an approach to leading and working that has noble intent, is deeply human, and recognises that we are profoundly interconnected with nature and each other.
Our own interests are inextricably bound to the interests of our team, customers, communities, humanity and planet. Mutual service provides a way to resilient and a fair future.
For leaders this involves a personal journey to develop qualities of character – heart, will and mind – as well as skills, knowledge and attitudes that activate both the will and knowhow to bring these to life practically.
Our role in your journey
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We have the challenge of looking inside, to magnify what is noble within us, and become what the world needs us to become.
The Series takes you on a leadership journey to explore and develop your leadership capacity to #leadforgood. Through the Series, you will explore and make sense of the complexity you are facing, with a focus on purpose, service, and values, enabling you to navigate uncertainty and influence system change with greater integrity, courage and confidence.
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