In recent months we have witnessed a significant push to rethink the idea that the purpose of business is to drive shareholder profit. As business leaders and advisors we are being asked to view companies as vehicles for achieving value for employees, communities, customers and the planet, as well as owners.
Perhaps this is a natural societal response to the last few decades of business ‘success’ being defined by economic growth alone.
We also find ourselves in an era of global climate protest, fuelled by unprecedented scientific consensus on the catastrophic decline of our natural world. The environmental and human costs of many business practices are being exposed and better understood. Across our firm, people are looking for ways to do things differently and better, for ourselves and for our clients.
The mind-set shift required to pursue a social or environmental purpose doesn’t come easily to many businesses, because on some levels it feels like a trade-off. Through Deloitte’s Fast 50 and Top 200 Awards, we unapologetically celebrate New Zealand’s biggest and fastest growing companies. For large and small companies alike, pursuing any purpose other than shareholder return has long been perceived as an optional, additional cost that many businesses, especially SMEs, can’t afford to bear.
In order to move toward the future with a new, better purpose, we need to understand what better looks like and how it works. We need new exemplars, metrics and success stories. That’s where certified B Corps come in.
Certified B Corporations are businesses that meet high standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose.
Around the world, B Corps are accelerating the global culture shift to redefine success in business and build a more inclusive and sustainable economy.
Here in New Zealand, the B Corp community is growing. Whether to answer shifting consumer demand, changing investor expectations or the ability to hire the best talent, a growing community of New Zealand enterprises are pursuing B Corp certification. It’s not just the small end of town - recently Kathmandu became New Zealand’s largest business to be certified so far.
Profit is necessary to ensure organisations can raise finance and can achieve their purpose.
There is emerging evidence that organisations that do pursue a social or environmental purpose are more profitable rather than less, and B Corps are on the front lines of proving the case. So, it is not the case that purpose-led organisations are inherently less profitable, rather profits underpin the long term sustainability of the organisation and allow it to continue making an impact that matters.
Through my work with B Lab Aus/NZ preparing their first ‘State of the B’ report, I had the opportunity to learn about the individual businesses certifying in our region, and also the values and experiences that connect them as a community. I could see in the enthusiasm from my team that the B Corp narrative resonates with them, the next generation of professional advisors. The pursuit of purposeful business doesn’t appear so much as a trade-off, but an opportunity to leverage their commercial skills to work on the things they care about and create longer term sustainability both for the world, and their bottom lines.
B Lab wants to build strong partnerships to do this work here in New Zealand. If you’re looking for a way to understand the impact of your business, lead with purpose, and build sustainability into the DNA of your company, then I encourage you to connect with the B Corp community and find out more.
B Lab’s inaugural ‘State of the B Aus/NZ’ report is being launched on Tuesday November 12. Register for the webinar here.