Why integrate a social mission into your business?

You’re an entrepreneur with an idea and maybe a business plan, a small-business owner or the head of mid-sized company.  To expect you to add social purpose to your business just because it’s a good thing to do, is foolish.  You have a bottom-line and other obligations to meet.  You don’t have extra resources to allocate to ‘doing good.’

But doing good is a business strategy, not merely a moral argument or trend.  Businesses with a strong social mission have a competitive advantage.

1. People will talk. consumers, competitors, investors, suppliers and the press.
2. Increased productivity and employee morale.  People want to work for a greater purpose and want to know that their work makes a difference. Employees who are happier work harder and smarter because the work has become personal.  These type of employees are advocates for your company, not just employees of it.
3. Consumer preference. Consumers prefer companies that make a positive impact on the world.  Eighty-three percent of U.S. consumers want more of the products and services they use to benefit causes (2010 Cone Causes Evolution Study) and 62% of global consumers will switch brands if one works with ’good causes’ and the other does not (Edelman, 2010).
4. Innovation.  More companies like Nike, GE and Interface are using sustainability to drive innovation. Seventeen years ago, the late Ray Anderson, who served as Interface’s CEO, committed to becoming a zero-waste company by 2020. Since then, Interface has eliminated hundreds of millions of dollars in resource and waste disposal costs, increased sales by more than one billion and changed the way the entire carpet industry does business.
5. Influence.  Your company’s initiatives will be modeled as more companies realize the benefits of having a social mission.
6. Lower marketing costs.  Your mission will help your marketing. A line of grocery products founded and once produced by Paul Newman (Newman’s Own) is a somewhat banal story that merits only a mention in the press. The fact that the company donates 100% of profits to charity is a story that sticks, intrigues and encourages participation through purchase.
7. Talent recruitment.  People want to work for employees that care; a social cause is indicative of a favorable workplace.
8. Attract talent for less. Kevin Jones of Good Capital calls this “meaning premium.”   People want to work for a company that allows them to contribute to a greater purpose and are willing to be paid less for the opportunity (NB: this isn’t an argument for underpaying employees).
9. Attract young talent.  Teach for America is a top employer of exceptional college graduates. Last year 12% of  seniors at Ivy League schools applied to work with Teach for America, vying for one of the most challenging and low-paying jobs out there.
10. Talent retention.  When employees are part of a larger mission and feel their contributions make an impact in the world, they’re engaged, proud and motivated.
11. Savings in resource and disposal costs. You’ll save money by reducing energy, water and material consumption. Producing less waste and reusing water or materials costs you less to purchase and less to haul away.
12. Supplier advantage.  Stonyfield Farm pays its organic suppliers a floor price that won’t ever drop, protecting its suppliers from market swings and production hiccups. In return, when supply for organic milk or sugar outpaces demand, Stonyfield is first on the delivery list and is guaranteed a fair price because it’s built a relationship with its suppliers.
13. Risk management. Being in tune with your stakeholders alerts you to potential risks and helps you safeguard against them. An offshoot of this is that your company is better informed and positioned to identify new business opportunities.
14. Future-bound company.  Successful companies that others evangelize and model represent more than just a product or service. They represent a philosophy, culture or experience. When you channel this back into your business, you’ve made your competitive edge that much more edgier.
15. Fun.  Science proves what most of us know–making a difference feels amazing. We feel happy, enlivened and creative.

Your company (1, 5 or 200 employees) is the ideal size to run a purpose-driven business. Although larger brands get more attention for the resources they can bring to their campaigns your company holds an advantage.

1. You’re more agile. You can plan, execute, track and revise nearly on-the-fly. Less memos, less approval, less internal politicking diluting the programs.
2. You can take more risks with your social mission. You have less of a reputation to uphold. You can be a renegade, a heretic, recognized for your commitment to social change and your willingness to try new ideas.
3. You face less financial accountability. Smaller companies aren’t held to the same monetary expectations as larger ones. Your programs’ strength lies in their impact and effect rather than your company’s financial commitment.  A big brand cosmetic company’s one-time campaign cost $500,000 in an upfront investment to its partner charity, the cost of a micro-site and prize expenses, and delivered just a luke-warm impact. Your cosmetic company can affect people more directly by offering products and makeovers to women re-entering the workforce in partnership with a workforce re-entry program and your local Dress for Success chapter. Cost? In-kind only.
4. You have a fresher slate. Small companies are often seen as more personal, less greedy and less noxious. There’s less initial cynicism of your motives and choices.
5. You entice stronger non-profit partners. Smaller companies are rarely able to attract (nor should they try to) the top crust of non-profits.  With fewer wooers and less brand value, a regional non-profit will be more willing to commit time and labor to the project, as opposed to just a sliver of its name recognition.
6. You can galvanize your employees around your mission more easily. As companies need to convince consumers of their sincerity, they also need to convince their own employees. The smaller a company, the shorter this process. Employees help determine the social mission, shape it and execute it.
7. You have more of your customers’ attention.  Generally, the larger a company is the more we view it as a commodity and the less likely we are to see it as an educator or driver of good. Would you be more willing to support a pin-up campaign at Walmart or your neighborhood cupcake bakery? One of your advantages as a smaller business is the frequency of touch points that you have with customers. Use these opportunities to bring them into your mission through storytelling, contribution and advocacy.

Having a social mission is not a drain on company assets or a tangential program, it is a business strategy that yields a competitive advantage, which smaller companies can better leverage.

Many CEOs seem to have reversed cause and effect. Brand trust and reputation are the result of a company’s sustainability actions. Are we being set up for a decade of window dressing and cause-washing as companies cobble together sustainability programs to burnish their public image?

These findings were published last week by the United Nations Global Compact and Accenture. Internationally, 766 CEOs were polled on sustainability and business with 72% identifying brand, trust and reputation as their biggest motivator for sustainability, 44% citing revenue growth and cost reduction, 42% personal motivation, 39% consumer demand and 31% employee engagement and retention.

Seven years ago we would have celebrated the fact that 93% of these CEOs see sustainability as critical to their companies’ success. But really, how can that be disputed? Today, sustainability is fundamental. The remaining 7% will be swept along or swept away soon enough.

So the challenge I see is exciting business leaders and employees about the non-public facing side of sustainability. How can we communicate the subjective and financial value of creating a sustainable workplace? Or of reducing waste? Or switching to environmentally preferred materials?  We need more Interfaces–companies that transform their entire system and resource selection, not their advertising and marketing strategies–and less (Product) RED-like campaigns.*

*I have a lot of respect for the (Product) RED campaign for the money and awareness it has raised and for the way it’s allowed diverse companies to get involved. But we’re evolving past the stage of one-off (even long-term) cause marketing campaigns to significant systems change.

How to let your mission guide you:
Your mission should guide your decisions, but sometimes you’ll have to prioritize long-term mission over short-term consequences as Organic Valley did when it shipped milk from Ohio to North Carolina to help farmers there start a local business. The short-term compromise was the environmental impact of shipping milk so far. However, this decision empowered a new region of family farms which advanced Organic Valley’s mission to “support rural communities by protecting the health of the family farm.”

No, you don’t have to be a socially driven company to lead with mission and other myths:

1. Mission as your primary product is not just for socially responsible companies. Virgin Atlantic’s rock and roll irreverence drives its brand and distinguishes it from a homogeneous fleet of airline carriers.
2. Mission-based decisions don’t just apply to cause marketing or employee volunteer programs. They impact every angle of the business, from market expansion and labeling to recruitment, employee training and compensation, to investor and supplier relationships.  
3. Your mission doesn’t have to be sexy to be successful. My favorite example of a company that’s turned an unsexy mission and service into a paragon of business done well is the online shoe retailer Zappos. With exceptional customer service as its North Star, Zappos has grown into an innovative and extremely successful company.
4. Your mission is not immutable. You can upgrade it. Interface’s mission didn’t always begin with ”Interface will become the first name in commercial and institutional interiors worldwide through its commitment to people, process, product, place and profits” and end with “We will honor the places where we do business by endeavoring to become the first name in industrial ecology, a corporation that cherishes nature and restores the environment.”  The company’s products, values, resource use and profits-base shifted 16 years ago when Interface’s CEO Ray Anderson committed to changing the way the company did business.

“If your employees or people connected to your company can’t tell you how the given mission of your company would affect a decision they have to make, then you are probably not staying focused enough,” says Seventh Generation’s Jeffrey Hollender.

In 1994 Interface set a gutsy goal called Mission Zero to be waste-free by 2020.  Today, Interface is well on the way toward its goal and has eliminated hundreds of millions of dollars in waste, as well as increased sales by more than $1 billion.  That is astonishing progress, which is best understood (and replicated) by looking at how Interface translated its mission to the purpose and actions of every employee.

During an executive immersion program at an InterfaceFLOR carpet plant in Georgia, a senior leader of a large multinational corporation asked a forklift driver for directions. After he had given her directions she asked what his job was.

“My job is saving the planet.”

Surprised by his answer, the executive followed up with more questions about his experience at Interface. After several minutes, the driver became increasingly anxious and said,

“I’m sorry, ma’am. I have to go. Because if I don’t get this delivered soon, it will slow down our line, making more waste and pollution and hurting the planet, not saving it.”

Not only does this driver understand his company’s mission (the what and the why), he understands precisely how each of his actions contribute to (or hinder) this mission. Do your employees understand why your company mission is what it is and how the world will be different because of it? Do they know how each of their actions or interactions advance it? Do you?

This story comes from Adam Werbach’s “Strategy for Sustainability: A Business Manifesto.”

Image credit: Sealey Warehouse

Before tactics, I want to share a story you can cue for inspiration as you sit across from your boss and share your vision of a stronger company. A sales director named Joyce LaValle left a copy of Paul Hawken’s The Ecology of Commerce on her CEO’s desk, which led to a complete transformation of the company, as well as the industrial carpet industry. Joyce’s daughter encouraged her mom to get the book into Interface CEO Ray Anderson’s hands. After several attempts, it landed–ultimately leading to Interface’s pledge of zero waste by 2020. This was 1994 when Ray was struggling to address his organization’s environmental policies. Carpet manufacturers were criminal polluters and resource hogs. Today, Interface is well on the way toward its goal and has eliminated hundreds of millions of dollars in waste, as well as increased sales by more than $1 billion. Sixteen years later, Joyce heads the marketing for InterfaceFLOR and continues to be tapped for inspiration by people like you and me.

Convince your boss to add a cause-oriented program by:

1. Painting a picture of company growth. Consumers prefer companies that make a positive impact on the world.  Two out of three consumers will switch brands if one works with ’good causes’ and the other does not (Edelman, 2009).
   
2. Starting out small. Create a program around one sales cycle, holiday or company event; organize an employee volunteer day; sponsor and participate in a fundraising event in the community like a walk or run; switch your office supplies to sustainable products, start a work compost and continue to recycle; research and present SRI investment options for employees.
3. Illustrating that it doesn’t take money. Doing good is not about an extra line in the budget. Supporting community events by volunteering or providing in-kind donations or publicity does not take money. Switching to sustainable office supplies and composting does not take money (really–Give Something Back, Office Depot and others offer competitive pricing). Offering responsible investment plans does not take money. Supporting a non-profit’s point-of-sale program does not take money. A small retailer in the Boston area, Ocean State Job Lot, raised $212,000 for Boston Medical Center in one month by asking customers if they’d like to make a contribution.
4. Coming to the discussion with suggestions of causes or groups that connect to the company and its customers. Maker of natural beauty products, Burt’s Bees naturally supports conservation and sustainability. Pedigree supports animal welfare.
5. Mobilizing internal support. What do other employees care about? What scale of project does their enthusiasm support? Gauge enthusiasm and build support or even an informal team of peers.
6. Sharing success stories from other companies (start with Joyce LaValle). Find more stories from entrepreneurs here.
7. Presenting a list of resources. Point to resources from which the company can draw support for its new initiatives (students or professors of a local sustainability program and umbrella organizations and networking sites like Business for Social Responsibility, Social Venture Network, B Corporation, Net Impact or SCORE).
8. Pitching it as a recruitment and retention tool. Readers of this blog know that Patagonia receives more than 900 applications for every open position because of its social mission. People want to work for employees that care and a social cause is indicative of a favorable workplace.
9. Telling her why she will be respected for her efforts (and possibly famous). Ray Anderson is a paragon in industrial manufacturing, capitalism and sustainability. He didn’t need to have a sexy company that produced vegan shoes or mountain-climbing gear to make an impact. He started with what he produced and what he wasted.
10. Asking her what she thinks. Listen to her reservations and strategize with her about how to overcome them.
11. Offering to support or to lead. Depending on her level of enthusiasm or hesitancy you can take a supporting role through your work and and actions or a leadership role by developing a plan and strategy.
12. Being willing to take the fall. Stupendously disastrously executed programs fail. Programs from which we learn and improve, do not. Letting your boss know that you are willing to take the fall alleviates pressure and enforces your commitment to a social mission.

Have you pitched a social program to your boss?  What other tactics have you used or do you feel would be helpful?  If you’re a boss, who leads these efforts in your organization?  Do they come from you or someone higher up or more junior?