Redefining success: from profit maximisation to purpose-driven
For decades, businesses have focused on maximising profits for the benefit of shareholders. Today, some are experimenting with broadening those values – planet as well as profit, staff and communities together with shareholders. It is a purpose-driven mindset that redefines success from being the best in the world to being the best for the world.
Many studies show that purpose-driven organisations outperform profit maximisation businesses. Clearly, doing good is good business.
A wake-up call
The Covid-19 pandemic has highlighted the cracks in the current economic system. Before the pandemic, the world was facing multiple crises: the climate emergency, rising inequality and increasing public disengagement from democratic processes. Our current health crisis adds to and accentuates those concerns.
Looking to the future, many voices are calling for systems change, for economic models that deliver for people and planet. In a recent YouGov poll, only 9% of respondents want things to return to how they were before the pandemic.
Building a wellbeing economy
Covid-19 has shown us the stark divides in our economy between those who can readily work from their kitchen tables and those who cannot, including the delivery drivers who make remote working feasible. But it has also shown us a context for a better economy. The ‘wellbeing economy’ is designed to deliver social justice on a healthy planet.
Business has a vital role to play in this transition. As business leaders, it’s up to us to ask fundamental questions about the purpose of our businesses. How can we realise the opportunities to make a positive, regenerative contribution to the environment? How can we benefit from values-based collaboration and stakeholder relationships? How can we grow our businesses through enabling equal opportunities and sharing the wealth?
Taking the first step
There is no one single solution to the complex challenges we face, but there are solutions. The first step requires us to build individual and collective awareness of how current business operations impact and potentially damage local communities and the environment.
While we need to lead this process, we don’t need to do it alone. There is a wealth of intelligence within our organisations. Create a culture where employees feel safe to help explore these difficult and challenging questions. Ask them how your business can create a more positive impact on society and the environment. You’ll be surprised at what you learn.
Exploring potential solutions
Every business will navigate a different path. Each must consider all aspects of their business, from ownership and governance models to workplace participation, product/service innovation and stakeholder relationships. How might stakeholder voices be brought into the governance model? Employee ownership, a model that is gaining increasing attention in Scotland, is one solution. How might circular economy principles be used to minimise resource use and waste? Could local supply chains increase resilience (preventing disruption in times of crises) while enabling community wealth building?
These are just some of the solutions highlighted in the Wellbeing Economy Alliance’s ‘Business of Wellbeing’ guide. It is designed to help you navigate issues and find inspiration, and it includes a self-assessment tool and details of partners that can offer support.
Now is the time to be bold. Forget business as usual – let’s seize the opportunity to build back better.
Sarah Deas is a Trustee of the Wellbeing Economy Alliance (Scotland) and a member of the IoD’s Sustainable Business Special Interest Group
To learn more, visit www.wellbeingeconomy.org/scotland. Find the Business of Wellbeing guide here.