The world is changing at a pace and scale never before experienced by humans. Climate change, diminishing natural resources (water, fish, soil, oil, rare earths, forests, etc.), income inequalities, unprecedented species loss, growing government debt (international, national, and local), ageing infrastructure, the increasing costs of crises with a reduced ability to respond, and a population topping 7 billion – I covered some of this earlier. So what is the impact of these issues for organisations? That’s a lot of problems; I’ll rephrase that, that’s a lot of opportunities for companies prepared to be creative. Bear in mind too that most people couldn’t care less whether 70% of brands ceased to exist. In the context of resource limitations and increasing ennui on the part of consumers, if you really want your brand to thrive and survive you need to start thinking afresh.
Most businesses have a single yardstick to measure success: how much profit they make. Making money has been the single biggest motivator for companies in the last century, in the current one, that won’t be enough. If we want to have a future better than our past, companies need to stand for something by solving social and environmental challenges while also making money. This ‘added value’ has to have the ring of sincerity – eco/green wash just doesn’t cut it anymore. You could call it ‘Likeanomics’. Why?
In Principles of Political Economy (Of the Stationary State), J.S. Mill wrote that “the increase of wealth is not boundless. The end of growth leads to a stationary state… of capital and wealth.” Instead of seeing this as problematic, it was, in Mills’ view a “very considerable improvement on our present condition”.
Mill went on . . . “There would be as much scope as ever for all kinds of mental culture, and moral and social progress; as much room for improving the art of living, and much more likelihood of it being improved, when minds ceased to be engrossed by the art of getting on.”
What’s the trick to making a brand meaningful?
- Did brand A make you fitter, wiser, smarter, closer?
- Did it improve your personal outcomes?
- Did it improve your community outcomes?
- Did it pollute the environment?
Organisations need to think beyond “did brand A make a slightly better product” to “did brand A actually impact your life in a tangible, lasting, and positive way?” This is the equivalent of a bank asking itself the startlingly simple question “What if we (as a bank) help our customers instead of tricking them?”
- More than half (51%) of consumers want to reward responsible companies by shopping there
- 53% would pay a 10% premium for products from a responsible company
- 85% of consumers want companies to be engaged on global issues, but only 22% think they’re getting enough of this from companies . . .
Capital targeting for-profit businesses demands an ROI which encourages financial performance alone, and that in short-term bubbles.
This is why society sees corporations as narrowly motivated by profits, whilst seeing nonprofits as propagators of a nebulous good, and operating without the need for financial returns.
As Jess Bezos (Amazon.com) puts it, “shiny doesn’t last.” In short, he means that chasing profits at the expense of building longer-term loyalty and genuine feelgood is unsustainable.
That said, it makes sense to apply for-profit skills like distribution, scale, and marketing to creating cultural change. Given that businesses are better equipped to distribute and market innovations thanks to their structure, there is great potential to solve big problems and make big profits. It takes time, intelligence and investment.
The key to answering the threat of economic insecurity isn’t to ignore it, deny it, or try to control it, but to redraw the boundaries of competitiveness. How?
By taking responsibility you fuel outperformance through risk management which is a better insurance against adverse future events. It’s a competitive advantage, not a tradeoff. It really is that simple.