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What’s Your Business’s Purpose? Please Don’t Say “Doing Good.”

Nathan Havey April 25, 2017

Perhaps the single most popular platitude in the conscious business movement (and in the pages of this magazine) is “using business as a force for good.” But when we use this phrase, we invoke a good/bad duality that is mostly useless when you take into account how subjective it is.

For example: is Ben & Jerry’s “using business as a force for good” because the company uses Fair Trade ingredients, pays nearly twice the minimum wage as a starting salary, and speaks up for racial justice? Or not, because its products involve animal agriculture and extract profits from the obesity epidemic? If I told you that a bank was “using business as a force for good” by investing $70 billion in sustainable energy since 2012, you might applaud its efforts until I revealed that the bank is Wells Fargo, which is also funding the Dakota Access Pipeline and was recently involved in a major fraud scandal.

Or what about the fact that in the 200 years since the Industrial Revolution began, humanity has achieved a far better average quality of life than has ever been possible, largely through innovations and positive social changes brought by good ol’ profit-maximizing business? Isn’t that systemic improvement an example of “business as a force for good” on a grand scale?

You could see it that way; and if you also choose to notice the life-threatening environmental degradation “business as usual” has created, and recognize that a huge portion of humanity is not enjoying that same opportunity for a high standard of living, you’ll also see there is great room for improvement. But we communicate none of this complexity when we use the phrase “business as a force for good.”

“GOOD” ISN’T A GOOD ENOUGH STANDARD

Like greenwashing, goodwashing is all too easy if we don’t have a more rigorous standard to hold each other to than simply the word “good.” The idea that a business seeks to “do good” can be applied so broadly that it’s virtually meaningless. It’s like an entrepreneur pitching investors by saying that their business idea is to sell stuff to people; um … can you be more specific?

If you want to build any kind of business, you need to know how you will solve a specific problem for a specific group of people with a specific product or service. The same is true for “doing good.” A conscious company — one at the most advanced end of the business–purpose spectrum (see below) — has identified a purpose beyond profit that solves a specific problem for a specific group of people. The profit that comes from the sale of products and services becomes the fuel for this larger mission. It becomes the reason the company exists, the reason to make a profit. If “using business as a force for good” is at all meaningful, it can’t just mean “doing some good to promote a business.”

BEYOND “HELPING”

Please note that I use the word “solves,” and not “helps.” The power of any business lies in its sophistication in solving a specific problem for a specific customer; so, too, a conscious business must do more than “give back,” “have a positive impact,” and “do good” in a general way. It must have a specific, focused, and sophisticated strategy to affect the outcome of a complex system in the real world and solve a root problem, not just alleviate a symptom.

Many genuine and noble efforts to “do good” try to alleviate symptoms via interventions that have side effects that frustrate those working to deal with the root issue. The 2014 documentary “Poverty, Inc.” shows, for example, how many celebrity-faced and business-funded efforts to “do good” by providing aid for people in the developing world — while critically important in times of acute need — have had the unfortunate side effect of stunting economies that, if only they could take hold, would render the aid unnecessary.

My point is that solving important social, environmental, and technological problems is incredibly complex and difficult work. So complex, in fact, that leveraging the creative power of business may be the only way to make real progress. Businesses organize effort and coordinate action systems of dizzying complexity. Lasting solutions and further breakthroughs in broad-based prosperity and ever-greater human thriving will be the product of companies that are not content to “give something back” but of those that make such advances their mission. These conscious companies are doing far more than “good,” and if our language lumps them together with traditional businesses, we muddy the waters, which makes it easier for each of us to rest on our laurels rather than acknowledge how high the bar is and strive to reach it.

We should be talking not merely about “business as a force for good,” but about “business for a purpose beyond profit.” Where the former phrase suffers from the limitations that I outlined above, the latter invites the question “what purpose?” The answer to that is the key to getting to the most advanced stages of business consciousness. Let’s make sure that question comes up a lot. The future of business as usual depends on it.

Framework

The 5 Levels of Business Consciousness

As we move beyond the simplistic and over-general language of “doing good” in business, I propose introducing a five-stage continuum to help categorize where on the spectrum of consciousness any given business operates.

This continuum does not intend to belittle the achievements of companies in any stage; instead, it’s a guide to clarify what the next step might be. A company at Stage 1 can make a concerted effort to obey the law and get to Stage 2. A Stage 4 company’s volunteer hours and charitable contributions are wonderful and important in and of themselves, but in sharply focusing those efforts that same company can have a greater impact as it moves toward Stage 5. Companies should aim for whatever stage is next for them.

Stage 1 // Bad Actor

Lie, cheat, and steal to make a profit.

At this stage, a business has an almost total absence of purpose beyond making money, and has a similar lack of ethics and care for others. Of course, no company admits this. Some who are here may not even know it, but the company’s culture will always reveal the truth eventually. Think Enron and Tyco.

Stage 2 // Rule Follower

Obey the letter of the law.

At this stage, a business will ostensibly obey the rules of the game, and also take full advantage of others however it legally can. These companies won’t do something proactive for non-fiduciary stakeholders unless it is legally required, and they will take advantage of every loophole to save and make money. This is the dominant narrative on Wall Street.

Stage 3 // Fair Player

Do no intentional harm, but “business is business.”

At this stage, a business has an ethical core of “do no harm.” Its leaders will not consciously act in a way that takes unfair advantage of or inflicts pain and suffering on people, and they may seek to offset externalities through limited corporate social responsibility efforts and other damage-mitigation strategies. They will simultaneously compete fiercely to maximize shareholder return, which they see as the purpose of their company.

Stage 4 // Good Citizen

Take measures to have a net-positive impact.

At this stage, a company would like to produce a net-positive return for society through its operations. These companies encourage employee volunteerism, contribute toward a wide range of charitable concerns, and usually strive to create an enjoyable workplace culture. These businesses recognize that investing in social capital and goodwill creates important returns.

Stage 5 // Conscious Company

Embody a specific, measurable purpose beyond profit.

At this stage, a company is aware of its power to achieve a specific, important purpose beyond profit, and designs its culture and operations to leverage everything at its disposal to fulfill that mission. Growth and profit remain important, but no longer for their own sake. Now they are a necessary factor of achieving the purpose.


Nathan Havey is the founder of Thrive Consulting Group and the instructor for our new on-demand course on the Fundamentals of Conscious Business. Learn more at courses.consciouscompanymedia.com.

Leadership
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