What is an Impact Company or Purpose-Driven Brand?
There’s a revolution happening in business right now. It’s a movement that’s been taking shape for many years, but it has gained great momentum in the past decade. Many are calling it the Purpose Revolution and it’s bringing tectonic shifts to the for-profit business world. The growing population of conscious consumers, impact investors, and individuals who want meaningful work are helping to usher in a new age of capitalism. People are waking up to the fact that we cannot rely on government and NGOs alone to fix our problems, and that business and culture are becoming tools to create a better world.
For the first time in history, brands are playing a crucial role in addressing the unprecedented Global challenges we face. But what does it mean for a business to be a force for positive change? How does one define a “conscious company”, “sustainable business”, “purpose-driven business”, or “social purpose organization”?
A conscious company takes all stakeholders into account in its operations, decisions, and strategies.
A conscious company is guided by its values, purpose, mission, and vision. These principles inform the decisions that are made, creating a clear sense of internal direction. Conscious companies are as committed to positive social and environmental outcomes as they are to profits and self-preservation. They have a higher purpose beyond profit and shareholder returns that is core to their brand. Purpose-driven companies operate with high ethical standards, considering and measuring the impact they have on stakeholders, communities, and the environment. They operate with a mindset that puts the future on equal footing with the present, refusing to sacrifice the public good for the benefit of a few.
Profit is not the enemy of purpose. Businesses must turn a profit to survive. Money and profits become the fuel that powers the organization's mission and purpose. For sustainable, conscious businesses the challenge is generating wealth without the negative externalities, unintended consequences, and harmful side effects that inevitably come from exclusively prioritizing profits. Wealth should not be generated at the expense or exploitation of employees; it should not be generated for executives and shareholders alone. Conscious companies pay employees a living wage, helping to mitigate the growing wealth gap that’s been created by traditional business practices. Sustainable, conscious brands hold a long-term view and recognize that success and well-being are interdependent. They can’t be maximized in isolation, and brands with a higher purpose know this.
Purpose has been called “the new digital age” and there is mounting evidence that building purpose into a brand’s DNA is not just good for business; it’s a competitive advantage that will attract customers, employees, and investors. Big companies like Nike, Ben & Jerry's, Patagonia, and Eileen Fisher, as well as 5,000+ certified B Corporations, recognize that purpose and mission are complementary to financial success. Some of these companies have been operating with purpose at their core for decades, forging their own paths amid a business landscape that didn’t always understand what they were up to. But a new generation of consumers, employees, and investors are demanding that companies take a stand on issues that matter and become part of the solution. The rise in purpose-driven brands is accelerating and seeding a mindset that no business of any kind can afford to ignore much longer.
It’s clear that purpose is integral to the long-term success of companies moving forward.
Employees are no longer satisfied with punching a clock at the same company for life, making as much money as possible with the hope of giving back to charity and finding meaning upon retirement. They want purpose, and they want it now. It’s time for all of us to do our part to engage with the issues at hand and bring solutions from every angle.
As the purpose-driven movement grows, we can strive for a better future in which businesses help rather than hurt the environment, support wellbeing, and leave people feeling fulfilled and fairly compensated.
It’s time for businesses to stand by their values and embrace the transformation that capitalism is undergoing. Humans wrote the rules of capitalism that got us to where we are today, so we can change them to create a better tomorrow. Becoming a purpose-led brand is a journey, a mindset, and an ethos, not a destination or a box to be checked. No company is perfect. It’s about starting small, from within your organization, and remaining open to evolution and growth. Embed authentic purpose into your brand and allow your values to guide and inform decisions. We can no longer afford for any companies to perpetuate the “profit at all costs” approach to business. Purpose is the fuel driving the next economy and is an essential part of healing our planet and building a healthier global society.
