There are two types of companies: Those that want to ensure they meet all sustainability requirements to the letter. And those that want to make a positive difference in the world.
This article is addressed to the latter.
The categorization comes from Ryan Bromley. He is a partner at the British consultancy firm Good Innovation, and his categorization is based on conversations with 20 companies that fall into these two categories.
“The first group is focused on not doing anything wrong. This means they have all the basics in place: They have a diversity policy, they are working to clean up their supply chain, and they measure their CO2 emissions. All of that is good,” says Ryan Bromley. And then he adds:
“But they’re just doing what any company should be doing. And that way, they will never stand out from the crowd. They don’t turn their purpose into a competitive advantage – while also not making any significant difference in solving a societal problem.”
And then there’s the other category. These are the ones who, in Ryan Bromley’s words, have ambitions to be a force for good.
“They have either already done more than the basics or have ambitions to do so. I believe it will be them who will flourish in the long run,” says Ryan Bromley.
The four challenges for companies
He set out to find out what it takes for a company to truly have a positive impact. And he has come up with four prerequisites that need to be in place. The company must:
- Define the social problem it is uniquely positioned to solve
- Find the commercial return
- Embed impact into the way employees think and act
- Deliver impact on a large scale
Each of these four prerequisites comes with its own challenges. It’s not a linear process, and every organisation will experience a slightly different journey.Let’s go through all four with Ryan Bromley.
Define your social problem
Most companies have a purpose statement. Novo Nordisk, for example, aims to “drive change to defeat serious chronic diseases such as obesity and rare blood and endocrine disorders,” while the Carlsberg Group’s purpose is to “brew for a better today and tomorrow.”
But having a purpose is not the same as having ambitions to make a real difference in society, Ryan Bromley points out.
“It’s a good starting point, but what good is it if none of your customers and employees can tell you what it means? You need to be much more specific,” says Ryan Bromley.
Just as on the commercial side, you should find your specific unfair advantage. That is, a cause that fits well with your purpose and brand, and whose solution you are particularly well-positioned to contribute to.
“A company enters a market with the mindset: ‘We are particularly good at this. And we can beat the competition.’ The same mindset should be activated when it comes to impact,” says Ryan Bromley.
An example of a blatant mismatch is the British chain Sports Direct, which launched a major campaign to save bumblebees. A noble cause, sure, but:
“What does that have to do with anything?” asks Ryan Bromley:
“Of all the causes they could have chosen, they pick bees, which have nothing to do with their brand. Look for something that has an authentic connection to your company and that you have a real opportunity to influence. Then there’s a much greater chance of creating change and business simultaneously.”
Find the commercial Return
There are the business people and the sustainability or social impact team. The hard and the soft. Those who make the money and those who spend it.
That’s the reality in many companies. But if you really want to make a difference through your company, you need to break down that divide. You must avoid having earnings and impact competing against each other. Therefore, impact must be integrated into the core of your business.
“You need a business model that convincingly shows that impact benefits the bottom line. That way, you can simultaneously appeal to those who are passionate about making the world a better place and those who are focused on making money,” says Ryan Bromley.
The trick is to rise above the level where impact is about compliance and risk management.
“The companies that really excel have defined where impact can future-proof their business and develop new growth areas,” says Ryan Bromley.
A company that manufactures physical products may be facing a future with resource scarcity, increasing costs, and decreasing earnings. The company can avoid this by shifting to a much higher degree of recycling.
“It’s a simplified example,” says Ryan Bromley:
“But it illustrates how it can benefit your business to integrate impact into the core of your business case.”
- Embed impact into the way employees think and act
You have many employees in your company. They are different, as are their tasks, and this also applies to their dedication to and understanding of impact.
While your sustainability team lives and breathes to make a difference, impact may not be the first thing the production or accounting staff think of when they wake up in the morning.
But impact doesn’t have to be a distant thing. And you can do a lot to make impact more present in your employees’ daily lives, Ryan Bromley highlights. Here are four suggestions:
- Create decision guides: Develop guidelines specifically targeted to each department in your company. Let them contain questions employees can ask themselves to help them make decisions that align with your impact goals. “Virgin Money has developed five reflective questions where employees can ask themselves, for example, how a decision they make will affect customers’ relationship with money. It makes the impact of their actions tangible for them,” says Ryan Bromley.
- Measure your progress: Many companies conduct annual employee surveys but don’t ask the right questions. Maybe they ask if the company has a clear purpose. But they would get much more out of formulating the question as “How much does impact matter in the decisions you make in your daily work?” or “Do you feel you play an active role in delivering on our purpose, which is [Insert your company’s purpose]?” Remember to measure consistently over time so you can track progress and see if there are departments in your company that are particularly struggling to deliver on your purpose.
- Make impact part of the company’s rhythms and rituals: Companies have fixed milestones such as induction programs, department meetings, and performance reviews. Ensure that impact is naturally integrated into these rituals. Impact should not be something employees only encounter in the CEO’s annual speech to the staff.
- Invest in impact support: Some departments will have more difficulty than others in delivering on your purpose. They may be overburdened, have other priorities that seem more important, or just struggle to see how impact relates to their job. Support them! “I’m starting to see job titles like ‘Purpose Integration Manager’ or ‘Employee Impact Manager’. These are simply people whose job is to help employees integrate impact into their daily work,” says Ryan Bromley.
Create impact on a large scale
If you’ve got the first three points covered, you’ve come a long way. You’ve created the foundation for impact, and you may already be starting to positively influence your surroundings. Now it’s about scaling up. And that’s easier said than done.
Ryan Bromley has three suggestions that can put your company on the global map.
- Create flagship initiatives: Dig deep into your purpose and come up with an initiative that is a natural extension. If you sell home furnishings, for example, you can create an incubator or accelerator program for entrepreneurs who make home products that fit your assortment, or you can award an annual prize to social entrepreneurs in home furnishings in developing countries. Just remember that your initiative must do more than just look good. It must make a real difference.
- Create better products for current customers: Get your customers on board with your impact journey. Ask them what would make their lives easier and how you can make a positive difference in the world. Incorporate the knowledge you gain into the development of your products. “Ask yourself how you can have a positive impact on the world together with your customers,” says Ryan Bromley.
- Develop forward-thinking products for future customers: The future is coming, and with it new competitors who will challenge your business. Get ahead of them, advises Ryan Bromley. In other words, it’s an innovation task he’s suggesting. Develop products that align with your company’s purpose and benefit the world before those around you do. Ryan Bromley points to the pet food market, where major brands have lost market share to companies that have developed, for example, raw food or food with protein from insects. “Every company should find its own disruptor before the disruptor finds them,” says Ryan Bromley.
Put a fleet of speedboats in the water
All of this can seem overwhelming. But it’s necessary if you want to power up your company’s purpose while also benefiting your business, Ryan Bromley believes. And no one says you have to be finished by tomorrow or the day after. On the contrary.
“This is not a linear journey, but rather a circular one where you return to each step again and again as the world – and your company – evolves,” says Ryan Bromley.
You shouldn’t think of it as turning a supertanker, he notes. Because then the task seems insurmountable.
“The more you can break it down into small, manageable sub-elements, the better,” says Ryan Bromley:
“Think of it as an exercise in putting a fleet of speedboats in the water.”
Some of the speedboats will make it. Others won’t. But together they will create momentum, Ryan Bromley points out.
“Once that development is underway, you can’t turn it around. There’s only one way to go, and that’s forward,” he says:
“That’s how I believe companies can work if they really want to be a force for good.”
You can read the complete report from Good Innovation here.
