ECONOMIC PURPOSE
Where social purpose and good business intersect
IN ASSOCIATION WITH & It pays to be good.
What does it mean for a business to operate with purpose?
Is the answer a set of well-defined brand values, a corporate responsibility initiative, a clear vision for future growth?
Or is it something more fundamental than that, such as, the very reason a business exists?
IN ASSOCIATION WITH & Drawing on The Economist Group’s global panel of executives, we conducted an Our methodology online survey, in association with Salesforce and Genuinely, in July and August 2017. The survey included 1497 business professionals.
Geographical coverage included: Company role: Company background size: Footprint:
Senior analysts C-Suite not disclosed EUROPE 27% 4% Regional/ or below Over 479 domestic NORTH 30% $1bn 31% Global/MNC 48% AMERICA 52% Under $1bn 482 Managers 65% to MD MEA APAC 43% 113 327
SOUTH AMERICA 96
Survey fielded online in July and August 2017 *Survey conducted in English among the Economist Group Opinion Leaders and Reader panels.
IN ASSOCIATION WITH & FINANCIAL COMMITMENT ECONOMIC BUSINESS PURPOSE TO SOCIAL HEALTH PURPOSE
IN ASSOCIATION WITH & Three types of benefits
Financial Stakeholder Reputational 58% 79% 72% of executives in companies operating of employees agree “It is important to of consumers are holding with purpose rate their financial me that I work for a company which companies accountable for the performance as strong (vs. 42% of their operates with a social purpose” corporate values they express peers)
IN ASSOCIATION WITH & “Great companies create frameworks that use societal value and human values as decision-making criteria… At great companies [financial] profit is not the sole end; rather, it is a way of ensuring that returns will continue.” *
Rosabeth Moss Kanter Professor Harvard Business School
*Source: “How Great Companies Think Differently” by Rosabeth Moss Kanter, Harvard Business Review, November 2011
IN ASSOCIATION WITH & Far from being a passing fad, purpose in business is taking brands closer to a model that allows for measurement of both social and business health.
We refer to it as: ECONOMIC PURPOSE
commitment courage measurement authenticity and accountability
IN ASSOCIATION WITH & COMMITMENT “The decision to go with a purposeful strategy starts with an iconoclastic leader.” 66%
Freya Williams CEO North America Futerra 29% 27% 26% 15%
CEO EMPLOYEES OTHER SENIOR CONSUMERS/ OVERALL C-SUITE/ EXECUTIVES CUSTOMERS LEADERSHIP
The majority of global executives agree; 66% believe the CEO is the greatest influencer on whether or not a company operates with social purpose.
IN ASSOCIATION WITH & COURAGE nearly fewer than 2/3 1in5 executives (62%) believe see their company as a that companies need to be public advocate willing to willing to take a vocal, take a vocal stand on social public stand on issues issues despite potential affecting society backlash
1in10 20% are concerned about of executives cite risk legal risk, as well as to performance/ political or public operations as a key barrier backlash to successfully operating with social purpose
IN ASSOCIATION WITH & MEASUREMENT In an economic purpose model the values at the heart of a brand allow it to transcend its product offering at any one moment, provide ongoing value to the world, and become an enduring institution.
of executives believe operating with social purpose has benefitted the customers their company serves & the communities in which it operates
believe operating with a social purpose has improved the lives of employees at their company
link it to financial performance and growth
IN ASSOCIATION WITH & AUTHENTICITY
Paying lip service to social purpose does not cut it with today’s consumers.
Backlash grows in the gap between a brand’s declared stance and authentic action —
It won’t do to simply try and “green wash” an organisation using corporate responsibility initiatives as camouflage — this would lead to repercussions.
IN ASSOCIATION WITH & AUTHENTICITY
87% 85% 7 in 10
believe it is sometimes executives report agree that a mismatch of hard to tell if a company consumers are holding social purpose initiatives and cares about a social cause companies accountable corporate practices can or is just trying to sell more for the corporate values negatively impact a company’s products/services. they express. corporate reputation.
IN ASSOCIATION WITH & ABOUT US
About The Economist Group The Economist Group is the leading source of analysis on international business and world affairs. It aims to offer insight, analysis and services to the world’s most influential people. Underpinning the Group’s ability to fulfil this objective is a commitment to independence, integrity and delivering high quality in everything it does. Clients have been coming to The Economist Group for content for 70 years; the work of its team of 650 experts analysts and editors spanning 203 countries is underpinned by an unrivalled in-house survey panel of global senior executives that bolsters the qualitative and quantitative analysis we undertake. Learn more at: http://ebrandconnect.economist.com/
About Salesforce Salesforce, the global CRM leader, empowers companies to connect with their customers in a whole new way. For more information about Salesforce (NYSE: CRM), visit: www.salesforce.com.
About Genuinely Genuinely— a boutique consulting firm — advises companies to refine and translate their purpose into an actionable roadmap for growth. We believe the world would be a better place if more companies had the courage to live and operate from their purpose, and trusted it was a better path to profit. Learn more at https://genuinely.co/
IN ASSOCIATION WITH & Visit EconomicPurpose.economist.com to learn more.
@EconGroupMedia #EconomicPurpose
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