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Since the advent of social media and the rise of consumer influence on business, the expectation that companies will play a positive role in society has skyrocketed. Beginning with the Occupy Wall Street movement, citizens called on the industry to care more for the communities in which they do business. The Triple Crisis of 2020, the COVID-19 pandemic, the financial recession, and the revival of social justice movements only accelerated this trend. As a result, today's consumers require businesses to make a positive impact on their communities and the planet.
The rise of the purpose corporation
The call for corporations to clarify their contribution to society was made by business leaders too. In 2018, BlackRock CEO Larry Fink made waves on Wall Street by asking his portfolio company CEOs to clarify their purpose and contribution to society. In 2019, CEOs from the Business Roundtable, an association of high-growth company executives, issued new guidelines for corporate governance. They called for companies to “modernize the principles of a corporation to more accurately reflect a commitment to an economy that serves all people.” These moments helped redefine business purpose from just driving profits to creating value for all stakeholders.
Do well and do good
The directive for purpose-driven corporations has given rise to changes in the way businesses operate. According to The Blackbaud Institute Index, charitable donations rose by 8.9% in 2021. Companies that are in tune with the high-purpose trend are making an effort to align their company values with those of their stakeholders.
There is growing evidence that good business helps drive revenue by increasing customer loyalty and employee motivation. A 2019 survey in Fortune magazine showed that 72% of consumers believe that a company should be both profit and mission-driven. Impact Reporting UK reported that 87% of consumers are willing to buy a product or service based on a company’s advocacy of a social issue. Additionally, 88% of employees find work more fulfilling if they are given the opportunity to give back, while 65% will refuse a job offer from a potential employer that doesn’t have strong CSR programs in place. With a business environment known as “The Great Resignation”, it is clear that companies must try harder to attract and retain top talent.
Luckily, advances in technology have made it cost-effective and simple to launch corporate philanthropy and social responsibility programs. All-in-one technology suites have been developed to make it easy for companies to engage in social impact by streamlining processes and vetting nonprofit organizations to support.
These technology suites have tools like charitable rewards for customers, company-matched employee donations, charitable gift cards, and employee volunteer opportunities. Impact platforms are now incentivizing corporate leaders to mobilize their employees for good, a concept that simplifies and revolutionizes the way companies approach CSR and ESG.
Real solutions for real problems
How could you, as a company, step up to meet the needs of the people around you? Donating time, money, or products are effective measures one can take today.
During a crisis, senior executives have the premise and the business case to make decisions that help individuals in their communities. In 2020, corporate executives went above and beyond to support those affected by the pandemic and social justice issues. Good business continues to gain momentum.
Let's look back on how companies stepped up to meet the needs of their communities during COVID-19. These companies helped solve urgent problems:
- Netflix established a $100 million relief fund, which included $15 million for donations to organizations already working to support out-of-work production employees.
- Chef and restaurateur Jose Andres transformed his restaurants into community kitchens to feed those that were impoverished and vulnerable.
- Backcountry provided New York homeless shelters with almost 10,000 masks and donated $100,000.
During the pandemic, businesses just did what was right. No matter how big or small, they actualized their values by providing relief to vulnerable groups. Companies took action knowing that their success would be measured by their ability to solve real-world problems, not by how much they gave away in dollars, products, or time.
