OUP CORRECTED AUTOPAGE PROOFS – FINAL, 31/1/2021, SPi Putting Purpose Into Practice OUP CORRECTED AUTOPAGE PROOFS – FINAL, 31/1/2021, SPi OUP CORRECTED AUTOPAGE PROOFS – FINAL, 31/1/2021, SPi Putting Purpose Into Practice The Economics of Mutuality Edited by COLIN MAYER and BRUNO ROCHE 1 OUP CORRECTED AUTOPAGE PROOFS – FINAL, 31/1/2021, SPi 3 Great Clarendon Street, Oxford, OX2 6DP, United Kingdom Oxford University Press is a department of the University of Oxford. It furthers the University’s objective of excellence in research, scholarship, and education by publishing worldwide. Oxford is a registered trade mark of Oxford University Press in the UK and in certain other countries © Oxford University Press 2021 The moral rights of the authors have been asserted First Edition published in 2021 Impression: 1 Some rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, for commercial purposes, without the prior permission in writing of Oxford University Press, or as expressly permitted by law, by licence or under terms agreed with the appropriate reprographics rights organization. This is an open access publication, available online and distributed under the terms of a Creative Commons Attribution – Non Commercial – No Derivatives 4.0 International licence (CC BY-NC-ND 4.0), a copy of which is available at http://creativecommons.org/licenses/by-nc-nd/4.0/. Enquiries concerning reproduction outside the scope of this licence should be sent to the Rights Department, Oxford University Press, at the address above Published in the United States of America by Oxford University Press 198 Madison Avenue, New York, NY 10016, United States of America British Library Cataloguing in Publication Data Data available Library of Congress Control Number: 2021930516 ISBN 978–0–19–887070–8 DOI: 10.1093/oso/9780198870708.001.0001 Printed and bound by CPI Group (UK) Ltd, Croydon, CR0 4YY Links to third party websites are provided by Oxford in good faith and for information only. Oxford disclaims any responsibility for the materials contained in any third party website referenced in this work. OUP CORRECTED AUTOPAGE PROOFS – FINAL, 31/1/2021, SPi Preface This book is innovative not only in the message that it is seeking to convey about the purpose of business and the process of putting that purpose into practice. It is also unusual in terms of the way in which it has arrived at this message. It has done so through a partnership between a company, Mars Incorporated, and a university, Oxford University. This has been a multi-year partnership on which many of the conclu- sions of the book are based. Over the years the partnership has broadened out from being between one company and one university to multiple companies and universities. It therefore draws on the experiences of many organizations and the knowledge of many academics and researchers around the world. The breadth and depth of the relationships between business and academia have provided an exceptionally rich source of information, data, and knowledge. The content of the book is also unusual in seeking to convey a coherent, consistent message while at the same time drawing on the experience and understanding of the many companies and people that have participated in the programme. It is therefore edited by two people but written by multiple authors who are leading experts in their fields and acknowledged in the list of contents and contributors. Nevertheless, it is not a traditional edited volume of related but disparate articles but a radical call for reform of business spoken with one voice. That could not have been achieved without the very constructive collaboration of all participants in the programme and the way in which they have responded to the process of editing to ensure the necessary degree of coherence and consistency. We would therefore like to begin by acknowledging the huge amount of work and support that all of the participants in the programme in Mars Inc., Oxford University and in the many other companies and universities have provided throughout. OUP CORRECTED AUTOPAGE PROOFS – FINAL, 31/1/2021, SPi vi It would also not have been achieved without the immense editorial support that Caroline Scotter Mainprize, Ben Jackson of Freud Communications, Kate Roll of Oxford University, and Jay Jakub and Francesco Cordaro of Mars Catalyst, the think-tank of Mars Inc., have provided. We are grateful to Mars Inc. for the funding of the six-year research programme on Mutuality in Business at the Saïd Business School which underpins the results of the research. We are extremely grateful to the researchers from Oxford University, Mars Inc., and many other universities and institutions around the world for authoring the chapters in Part II of the book. We are also very grateful to Alastair Colin-Jones, Justine Esta Ellis, Aida Hadzic, Francois Laurent, Sudhir Rama Murthy, Helen Campbell Pickford, Yassine El Ouarzazi, Judith Stroehle, and the fourteen companies involved in the case studies in Part III of the book for their immense assistance in their preparation. Finally, we would like to thank Adam Swallow at Oxford University Press, and two anonymous referees of our book proposal. The book is in four parts. The first part comprises two chapters that introduce the subject and summarize the contents. The second part describes the different components of putting purpose into practice associated with the underlying business concept, known as the Economics of Mutuality. The third part is a set of case studies of companies from around the world in different sectors, at a variety of different stages of their development that have put purpose into practice. They reveal the extent to which companies are increasingly adopting the ideas of this book. The final part concludes and discusses other aspects of reform that will be required to put purpose into practice. Colin Mayer and Bruno Roche 31 December 2019 OUP CORRECTED AUTOPAGE PROOFS – FINAL, 31/1/2021, SPi Contents List of Figures xi List of Tables xiii List of Contributors xv Case Study Contributors xxiii PART I 1. Introduction 3 Colin Mayer and Bruno Roche 2. Overview 24 Colin Mayer and Bruno Roche PART II 3. Bread and Honey: Social Flourishing, Mutuality, and Economics 45 Martyn Percy 4. The Roots of the Economics of Mutuality 56 Jay Jakub 5. The Meaning of Mutuality 74 Catherine Dolan, Bojan Angelov, and Paul Gilbert 6. Mutuality and Concepts of Responsible Business 87 Alastair Colin-Jones and Sudhir Rama Murthy 7. Purposeful Ecosystem Orchestration 98 Sylvain Remy, Julie Kolokotsa, Jan Ondrus, Yassine El Ouarzazi, and Nicolas Glady 8. Delivering on Purpose: Business Ecosystem Orchestration in Practice 113 Yassine El Ouarzazi OUP CORRECTED AUTOPAGE PROOFS – FINAL, 31/1/2021, SPi viii 9. Creating Cross-Sector Partnerships 130 Sudhir Rama Murthy and Alastair Colin-Jones 10. Measuring Non-Financial Forms of Capital 141 Francesco Cordaro, Alain Desdoigts, Justus von Geibler, and Claudia Senik 11. Building Social Capital 154 Marcel Fafchamps 12. Well-Being at Work as Human Capital 163 Claudia Senik 13. Accounting for Natural Capital 174 Richard Barker 14. Implementing a Mutual Profit and Loss 187 Robert G. Eccles and François Laurent 15. The Impact of Mutual Profit on Business Behaviour 199 Robert Eccles and Judith C. Stroehle 16. Mutuality and the Potential of Microequity 211 Muhammad Meki, Kate Roll, and Simon Quinn 17. The Impact of Mutuality on Ownership 221 Jonathan Michie 18. The Influence of Large Investment Funds 231 Helen Campbell Pickford 19. The Impact of NGO Activism 245 Andreas G. F. Hoepner and Qian Li PART III. CASE STUDIES 20. Bel Group: Harnessing the Power of an Informal Distribution Network 259 Alastair Colin-Jones, Alexandra Berreby, Caroline Sorlin, Hannah Radvan, and Justine Esta Ellis 21. Marks & Spencer: Improving Supply-Chain Sustainability 268 Sudhir Rama Murthy, Mike Barry, and Justine Esta Ellis OUP CORRECTED AUTOPAGE PROOFS – FINAL, 31/1/2021, SPi ix 22. Sabka Dentist: Taking Accessible Dental Care to Scale 277 Yassine El Ouarzazi, Lionel Khalil, Aida Hadzic, Kate Roll, Judith C. Stroehle, and Vikram Vora 23. Timberland and the Smallholder Farmers Alliance: Creating a Data-Driven Smallholder Cotton Supply Chain in Haiti 283 Hugh Locke, Atlanta McIlwraith, Lionel Khalil, and Kate Roll 24. Dell: The Business Case for a Sustainable Supply Chain 292 Louise Koch, Stephen Roberts, and Justine Esta Ellis 25. Interface: Turning an Environmental Problem into a Business Opportunity 303 Jon Khoo, Miriam Turner, and Justine Esta Ellis 26. Solvay Chemical: A Tool for Identifying and Planning Sustainable Business Strategies 311 Justine Esta Ellis, Alastair Colin-Jones, Jean-Marie Solvay, and Michel Washer 27. Z Zurich Foundation: Building the Case for Effective Insurance in Flood-Prone Areas 318 Helen Campbell Pickford, David Nash, and Justine Esta Ellis 28. Divine Chocolate: Creating Sustainable Value in the Cocoa Sector through Mutual Ownership 325 Justine Esta Ellis, Alastair Colin-Jones, and Jamie Hartzell 29. Mondragon: Maintaining Resilience through Cooperative Strategies 332 Justine Esta Ellis, Alastair Colin-Jones, and Ibon Zugasti 30. JD.com: Using E-commerce to Alleviate Rural Poverty in China 339 Lydia J. Price, Liu Xiaowen, and Ni Jing Hua 31. Kate Spade New York: Integrating Social Purpose into Core Business Operations 346 Taryn Bird, Aida Hadzic, Kate Roll, and Judith C. Stroehle 32. Mahindra First Choice: Orchestrating the Used-Cars Ecosystem 354 Ben Jackson and Genevieve Joy OUP CORRECTED AUTOPAGE PROOFS – FINAL, 31/1/2021, SPi x 33. Novo Nordisk: An Ecosystem Approach to Preventing Diabetes 363 Ben Jackson and Yassine El Ouarzazi PART IV. CONCLUSION 34. Conclusion 373 Colin Mayer and Bruno Roche Bibliography and Further Reading 377 Index 389 OUP CORRECTED AUTOPAGE PROOFS – FINAL, 31/1/2021, SPi List of Figures 4.1.