November Monthly Briefing: Growth of mission-driven business models Our views on what matters |
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There’s growing interest in mission-driven businesses, both as a response to public and political pressure for businesses to make a positive impact on society and the world, and as long-term value creation slowly edges into the investor relations narrative.
Social enterprises (commercial organisations which reinvest or donate profits to a social or environmental mission) are some of the best-known mission-driven businesses.
A new report by Social Enterprise UK (the largest UK social enterprise network) suggests they are not just attracting interest because of their ‘for-benefit’ orientation, but because they are outperforming conventional businesses in terms of revenue growth.
There’s also growing interest in certification and accreditation as a means to badge a company’s socially responsible credentials. Whilst industry is awash with a growing number of standards, benchmarks and certifications, B Corp certification (recognising businesses that meet the highest standards of social and environmental performance, transparency, and accountability to balance profit and purpose) is one of the most well-known.
However, by far the majority of B Corps are small and medium sized businesses. But while uptake among large multinationals and listed businesses has been slow some, like Danone, are working towards it, one operating company at a time. And the August announcement from the CEOs of Abbott, Coca Cola, Apple, Amazon and other major US business at the Business Roundtable calling for stakeholder primacy over an exclusively shareholder-led model point to big businesses looking at alternative operating models to secure long-term sustainability.
Will the growing interest in mission-driven approaches and early evidence that they outperform traditional operating models be enough to convince more businesses to reconsider their purpose and contribution in the world? And what are the implications of being mission-driven and independently accredited for companies?
In this month’s Briefing we discuss some of these questions which we posed in our 2019 Ten Actions for Business. Look out for our 2020 edition which will be coming out shortly.
Neil Davy CEO, Corporate Citizenship  |
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