Are you at risk of purpose-washing?
Over the past year there has been a step change in the importance people place on companies making a positive impact on society, whether those judging are consumers, employees or investors.
This position is ever more strongly held and is now guiding daily decisions on what people buy, where they work and what they invest in. Individuals have moved from feeling they ‘should’ care about the prosperity of society and the planet to genuinely caring as they are increasingly faced with real societal challenges in their day to day lives.
Shallow promises with no actions will not cut it in this environment. Businesses and brands who fail to walk-the-talk on their promises will come unstuck and lose trust with their consumers and employees, as all stakeholders are more motivated than ever to lift the lid and discover what lies beneath company statements and platitudes. Stakeholders are looking for commitment and action.
“Over half of consumers (53%) agree that every brand has a responsibility to get involved in at least one societal issue that does not directly impact it’s business but 56% of people believe too many brands use societal issues as a ‘marketing ploy’ to sell their products.”
Edelman In Brands We Trust? Report 2019.
In our ever more connected world, trust that has been hard won over years can be lost in an instant. The ethical practices of companies are now the key driver of company trust. Trust is built by both leaders and brands consistently doing what they have said they will. Businesses who market themselves or their products as sustainable, responsible or ethical need to be just that. These claims, if they turn out to be a mere PR exercise, will backfire spectacularly.
“People today grant their trust based on two distinct attributes: competence (delivering on promises) and ethical behaviour (doing the right thing and working to improve society). Ethical drivers are now 3x more important to company trust than competence.” Edelman Trust Barometer 2020
5 ways to avoid purpose-washing and deliver a genuine Social Impact:
Get the fundamental foundations right
Establish a responsible and ethical foundation to ensure delivery of the ‘must-do’s’ to be a responsible business:
- Ethical employment and leadership practices
- Ethical partnership arrangements with suppliers and customers
- Payment of tax liabilities
- Identification and implementation of the minimum expectations within your industry on which failure to deliver carries a reputational risk e.g. ethical sourcing of ingredients, industry expected environmental policies, industry expected HR practices.
Be clear about the Social Impact you can achieve
Ensure clarity on the social impact you want to deliver and business-wide buy-in to it.
- Articulate what your overall company purpose is i.e. the difference your business makes to people’s lives
- Based on your purpose and the assets you can deploy, identify the resulting Social Purpose i.e. what societal challenge you want to, and can help to, address and what impact you as a business aim to have in this area.
Tip: Use the UN Sustainable Development Goal Action Manager to help pinpoint the societal challenge you as a business are best positioned to help to address.
Don’t play at it
Identify what assets your business has to deploy to address the identified societal challenge and secure business buy-in to commit these assets over a meaningful time frame. These assets could include investment, time, knowledge, skills, brand reach through communications.
- Partner & Learn:
Seek out experts in the identified cause area and spend time understanding and learning about how you can best help address the challenge ensuring you avoid ‘white knight syndrome’ i.e. riding in with perceived solutions that cause more harm than good.
- Be in it for the long-term
Avoid ‘Charity of the Year’ type tokenism. Develop sustainable initiatives & partnerships that enable the business to make a positive impact over a meaningful time period.
Make it Core
Put your Social Purpose at the heart of your business to ensure it becomes part of the business’ DNA and is not seen as a discretionary workstream that is pulled when times get tough. Ensure clear ownership, develop KPIs and objectives, keep it on the Leadership team regular agenda and commit to annual impact reporting.
Get on and take action!
Consumers, employees and investors will punish companies who don’t step-up to the plate to address societal challenges in a meaningful and authentic way or companies who short-change them after promising lofty platitudes.
Doing the right thing in the right way that makes a genuine impact is no longer a choice taken only by progressive organisations but one that all businesses need to take seriously to continue to engage with increasingly socially conscious consumers, employees and investors…
and even more importantly, to make society a better place for us all.