Why it’s time to move from purpose to impact
Researchers found that in a crisis of leadership and an epidemic of misinformation, businesses enjoyed the status of most trusted institution globally, with a 61 percent trust level, outstripping NGOs, governments and the media.
It’s time for corporations to redeem the faith that consumers seem to be placing in them by stepping up and committing to meaningful action that has a positive impact on the stakeholders and communities they serve, rather than mouthing vague platitudes about purpose and vision. In short, it’s time to move from purpose to impact, an area where some businesses, particularly in the B2C sector, are already taking action.
In the past year, we have seen corporates do more than merely issuing declarations about employee health, safety and wellbeing. In the United States for example, a broad swathe of corporations have taken a stance on the issue of voting rights.
The importance of taking a stand
Charting an impact strategy requires actively identifying real-world issues for engagement, leadership and setting an example. Firms that are serious about impact strategy want to go beyond self-serving brand activism and platitudinous statements about purpose and meaning to boldly lead on issues that are important to the communities with which they interact.
In short, it’s about taking a stand on critical issues that stakeholders expect companies to engage with, whether regarding child labour and workers’ rights, sustainability in supply chains, social and racial justice, diversity and inclusivity in the workplace, green initiatives or ethical procurement processes.
There’s a lot at stake for firms that fail on the corporate activism front. In a separate look at the performance of sustainable brands during the early phases of the coronavirus pandemic, market research firm Nielsen noted that 74% of millennials in the US said they are more likely to spend money on brands that support social issues they care about. The pollster added that brands that demonstrate their purpose will be better positioned to enhance their reputations and eventually grow.
Impact also has repercussions for firms looking to attract top talent. In a preview of the year 2021, Forbes magazine listed the biggest business trends for which companies should prepare. In addition to the usual suspects such as working from home, sustainability and going from global to local, the publication notes that younger generations entering the workforce will be looking for careers with employers that offer the promise of purpose and meaningful work. “Companies that don't have a clear or meaningful purpose will struggle to attract talent and customers.”
Time to catch up
Companies in Finland also have some catching up to do in this regard. A Spoon Finland survey of content marketing trends in Finland in 2021 revealed that just 30 percent of participating firms had an impact strategy. The survey defined impact strategy as “a strategy for making an impact on issues that are important to their stakeholders.” This is not the same as CSR or sustainability programmes, which have become “hygiene issues” for companies as they are de rigueur in many industries. Impact means looking beyond that and pinpointing areas for doing good in the world and acting on those intentions.
In an era when reputations can be decimated overnight by one wrong move, a well-thought-out impact strategy can anticipate potential reputational landmines by intentionally adopting a set of values to guide relations and conversations with all of the communities in a firm’s sphere of influence.
So, if you aren’t already working on it, it just might be time to start thinking about your transition from purpose to impact.