I've just spent a week touring the U.K. with MBA students from the Simmons School of Management, led by Fiona Wilson. Our trip focused on companies that are good for people, the planet and profits. This is also variously called Conscious Capitalism or social entrepreneurship, and there's much debate about what fits or doesn't fit -- what is, or is not, a model. What everyone involved in the area does agree on is this: our current way of doing business obviously doesn't work. We need new models. So you could see this trip as an exploration of other ways of doing business. So, what did we learn?
Some Bad News...
People and companies struggling to do good spend as much time on in-fighting as those focused purely on profit. Theology and ideology is rampant. Whenever you're trying to save the world, this will be true. But it is discouraging and annoying to find green energy companies like Ecotricity so determined not to be a good partner with other green energy companies. Competition makes people do stupid things.
All of the companies we visited are pretty small -- none with revenues of $100 million. In part, this is because they're young. In part, it's because they don't think that size equals success; it can also be that size becomes its own problem. But if you really want to change the world, making a big impact does matter.
...And A Lot Of Good News
Spending a week focused exclusively on high-minded companies trying to do good in the world is pretty inspiring, not least because these businesses prove that you don't have to be brutal or exploitative to flourish:
Divine Chocolate -- proving that fairtrade cooperatives work for everyone and lock the mission into the brand. The fact that 45 percent of the company is owned by the Ghanaian cocoa farmers who supply the chocolate means that even if the company were sold, its suppliers would benefit. Structure counts.
A4E -- working with insane dedication to prove that everyone is employable if you take enough time and give enough attention. The unbelievable energy of A4E employees also testifies to how much difference a sense of purpose can make. You don't have to pay a fortune to get great performance from your people.
Fifteen -- Jamie Oliver's apprenticeship scheme for formerly unemployable young people is striking because -- like A4E -- it demonstrates how much more talent there is out there than most employers can see. And the fact that the restaurant is packed shows the public wants to support this kind of initiative.
Furniture Resource Group -- using all the strategic tools of business to build profitable businesses that benefit people and the planet alike. They fully recognize that high ideals make it more -- not less -- important to be brilliant and disciplined when it comes to execution. And they make great partners.
Triodos Bank -- uses the traditional engines of finance to support companies that do good for people and planet. Just goes to show bankers don't have to be evil. You have to love their strapline: More Green/Less Greed.
The Bluecoat-- testifies to the power of art to make people smarter, more collaborative and social.
Emma Bridgewater -- proves that it is possible to resist the 'race to the bottom' and protect quality with price.
Good Energy -- daily evidence that green energy is real, practical and that customers are willing to pay extra to cost the planet less.
2OC -- Out to prove that green energy can be very big indeed.
I feel like I've just returned from a trip to a parallel universe where business is a force for good, employees are well looked after and greed is supplanted by purpose. The question I'm left with is: will this ever become mainstream? And with the world so hungry for a new way to do business, why (instead of the same old grim cliches) isn't this the stuff of headlines?
Beau Friedlander: This Is Not The Climate Bill You Need To Fear
You're welcome to come and visit us next time you come over to the UK... not sure why you didn't this time considering your words above... sounds like you're regurgitating someone else's sour grapes! ;-)
We're doing some really interesting stuff that energy companies the world over are trying to emulate... do come and see next time.
Cheers
Paul – Online Community Manager - Ecotricity
The general mindset here is definitely one of competition, not cooperation. Actual co-ops are MUCH much more prevalent and advanced in the UK and other countries than the US. Co-ops are a wonderful example of social entrepreneurship.
Anita Roddick told me in the mid-90's that what I'm trying to create probably won't be accepted for another 15 years or so. She was absolutely right.
I'm finally getting ready to launch a new social enterprise, Wishadoo! I envision myriad projects and initiatives springing forth from this foundation. I invite you to learn more: www.wishadoo.org
The focus of Wishadoo! is to gather those dedicated to creating more compassionate, cooperative communities. This includes not only individuals and organizations, but social entrepreneurs and any business that would like to be a cornerstone of their community.
The Compassion Pages is similar to The Green Pages but for those who take it a step further to embrace the words "compassion" and "cooperation." :)
I feel most have been distracted and misled by those who try to say anything not pure capitalism is "evil" and are just misled about many issues here in the States; and now so many are simply trying to survive. It's time to change so much. Thanks for a great post!
Dena Patrick
You've highlighted some great businesses but missed the point: these are not 'high minded' companies but companies that understand that its ok to do good and make money because that's the way to make a sustainable difference.
This is no parallel universe - examples like these exist all aroud the globe.
and where on earth did conscious capitalism come from? suggest you research impact investing (along with social VCs, biz schools that get the sector and all the social incubators) so that you'll be better informed.
and btw, i invest in social businesses - we're at least 3 years behind them in the UK.
This is transformational. Profit as a means to embrace and carry forward societal good is a total smackdown of the greed displayed by Enron, Countrywide, Bernie Maddoff and other run-amoks.
Companies like Homeboy Industries, Threadless and Toms Shoes are building social values right into their business plans. While this seems fringe, Whole Foods ceo John Mackey has always talked about a “virtuous cycle”.
Why? The reasoning is simple. While some people work for a paycheck, more and more employees are seeking meaningful work.
Companies that make energy-efficient, sustainable products, that make social good a part of their reason for being, can attract a talent pool that provides advantage over their competitors.
Even as Google and Facebook wrangle about bonuses and Land Rover-style incentives in the Silicon Valley talent wars, some are no longer happy just to make a paycheck. They want to feel happy about what they make. It’s not just about the profits, it’s about the place, it’s about the people, it’s about a dream.
As more and more companies are able to create both, just as Bhutan measures its Gross National Happiness, perhaps one day we’ll be looking at a Dow Jones Happiness Average.