By Richard Cook,
In the first week of the year, Andrew Edgecliffe Johnson in the FT, asked: Should Business Put Purpose before Profit? (Jan 3 ,2019). He states that there is “a new model for capitalism based on the watchwords of purpose, inclusion and sustainability”.
So, should the new year resolution of business leaders in 2019 be to ensure that their business has a sense of purpose? What should PR practitioners say to business leaders who want to know whether Purpose is a good idea…
From a PR point of view, this is a complex issue that we need to be able to respond to and have a perspective on. The trouble is, the perspective and advice we may give to business leaders depends very much on how you look at it.
On the one hand, there is great merit to the suggestion that having a sense of purpose beyond shareholder value is essential for the modern, sustainable business. Andrew Cave of The Telegraph and author of the best-selling business book, The Power of Purpose states that “millennials increasingly look to their employers as being more than just a profit generator”. He also points out that the financial crash of 2008 which wiped out the value of RBS, is “evidence that shareholder value is not enough of a reason for a business to exist.”
He is not alone. The exiting CEO of Unilever, Paul Polman, said that brands are “stupid not to be forerunners on purpose”. Unilever, of course, has championed women’s self-esteem through its Dove campaigns and uses Ben and Jerry’s to raise awareness of environmental issues. Today, at the time of writing, Gillette’s campaign is asking whether sexist aggressive behaviour really is the “the best a man can get?”
There is a flip side. Unilever is also one of the world’s largest consumers of palm oil, apparently leading to more rainforest de-forestation than any other business. It is also one of the leading manufacturers of skin lightening cream, “Fair and Lovely”, sold to Indian girls in a market which considers white skin to be supreme.
Purpose Washing is a problem. Maria Hengeveld wrote in The Nation last week: “Big Business has a new scam. They are attracting Millennials to work with them with empty promises and self-serving slogans… Contrary to its aim, purpose isn’t to drive change, it is to make sure that any change stays within the comfort zone of the world’s most powerful execs.”
Andrew Edgecliffe Johnson said: “I have had business leaders lament that no wall street analyst ever asks them about their efforts to tackle climate change”.
The other issue that we as PR people have to be able to answer, relates to permission. When a business leads with a purpose, it is creating change. Even the most worthy cause has difficult questions it needs to answer. There are always going to be issues of regulation and quite likely to be debates about what is the right and wrong way to go about solving a problem. Does a brand have permission to be acting in such a fashion?
If a business initiative is keeping a community fed and free of disease, isn’t it actually letting government off the hook? Could it be that the well-intentioned initiative is actually making a problem worse?
Another problem that is very specific to the PR world is the act of telling the rest of the world about your business’ good deeds. Is it acceptable to do this and if so how and to what extent? Being seen trying to profit from purpose may incite a cynical response from the media and the target audience.
Having delved into this subject as a result of a Breakfast of Champions’ event we recently hosted, my own conclusion is that a business can and should have CSR activity that its stakeholders can get involved with and support, but this should largely be done discreetly.
The big-ticket activity should be administered by not for profit or government agencies rather than for profit businesses. If a business wants to get involved, it can give funds. A business needs to pays its taxes honestly, look after its employees, have a strong environmental policy and take responsibility for the supply chain, including recycling product.
Beyond that, I am yet to be convinced that being a forerunner on purpose is actually a sensible thing for a business to do.
Richard Cook is the founder and managing director of Champion Comminications
Photo by Tim Mossholder on Unsplash