How the pandemic has sharpened the focus on purpose
Business media have been talking up the benefits of organisations focusing on their purpose for some time now, but it seems that the pandemic has brought this concern to the fore in a starkly concrete way for many. What once may have seemed ‘fluffy’ and abstract – another piece of ‘woke-speak’ whistled up by corporate hipsters – has become for many an issue with existential implications, and purpose is being seen as core to their very survival in business.
Research over time has shown that companies with effective Corporate Social Responsibility (CSR) programs perform better in terms of profitability. Current thinking, however, urges businesses to look beyond traditional measures such as return on investment for shareholders as a means of gauging an organisation’s success. In 2019 Business Roundtable, an association of chief executive officers of America’s leading companies, released a new statement on the purpose of a corporation; it broke with the principle of shareholder primacy reasserted in every version of the document issued since 1997, and affirmed, ‘the essential role corporations can play in improving our society when CEOs are truly committed to meeting the needs of all stakeholders’. Note the word ‘all’.
We are in the age of the purpose-driven enterprise. Writing in Forbes, Afdhel Aziz linked to a dropbox full of evidence to prove that ‘the data that supports the thesis that “Purpose” (the catch-all term for “business as a force for good”) is good for business is overwhelmingly clear’.
And that was all before 2020 revealed the full scale of the cataclysmic changes in store for us that would lead to a focus on purpose for each and every one of us.
With America literally on fire, an article in the Harvard Business Review this June against the background of George Floyd’s killing by a white police officer in Minneapolis, spoke of a new age of Corporate Social Justice, in which CSR is reframed to centre ‘the focus of any initiative or program on the measurable, lived experiences of groups harmed and disadvantaged by society’.
Meanwhile the pandemic, with the closure of schools, workplaces, bars, restaurants, stores and pretty much everything else that defined ‘the old normal’, was forcing huge numbers of employees at a stroke to radically transform their old work/life balance, largely in favour of life. And when these employees returned to work again, the enforced period of reflection that many had been caused to undergo, along with all the other upheavals in geopolitics, social justice issues, climate change awareness and more, have unsurprisingly led to a big shift in priorities and perspectives.
Many business leaders see employees coming to them, after a period of furlough, having decided that ‘this isn’t really what I want to do with my life’. Others have found they were previously neglecting their families and want to maintain the benefits of flexible working. Corporations too are having a rethink. The head of an IT team in a major financial institution was told by their boss that remote working had actually shown an increase in productivity over lockdown, and policy would change going forward as a result. In addition, the company was cancelling a proposed new office build.
Many, sadly, have lost jobs they would have loved to continue with. But the crisis, for all its heart-breaking consequences, has brought about many long-overdue changes, accelerated digital transformation and shown new possibilities. The need for businesses to be agile was no longer just being blogged about, but being imposed by events. And this new agility, bringing with it a requirement for fast, often distributed decision-making, has forced many organisations to revisit, or at least clarify, their vision and values, in order to provide a touchstone in times of crisis. When backs are against the wall, people tend to get 20/20 vision on the essentials of life. And nothing is more essential to an organisation’s survival now than its purpose.
One leader of a UK social enterprise talked about how having to lead through crisis led to discussions on defining their vision and values more closely. It began as a half-hour session and turned into a whole day, but proved invaluable going forward - enabling them to move quickly as circumstances and government guidelines rapidly changed. The organisation, which works with homeless people, decided that its long-term purpose was to close down in ten years’ time – to work towards a future where the help and support it offered was no longer necessary. Your purpose might be… to not be.
Other organisations will be working in what might seem like a more usual direction towards building their sustainability and resilience. And in doing this they will have a driver of renewed urgency, as the employer/employee bond gets re-examined from the employee end in the light of Covid. Is this company I am working for able to withstand the crisis? Does it have a future going forward? What has this last year revealed to me as an employee about how seriously this organisation takes my safety and how much it values me? Is it still aligned with my own personal values, which may have changed or strengthened during the past year – and in fact was it ever, now I think about it?
In normal times, thoughts like these might have seemed too risky for a middling employee, comfortably settled with a family and a mortgage to entertain. But in a situation of high risk, with massive and sometimes cataclysmic change happening on a day to day basis, the risk aversion that holds so many back in business, and in their lives, has become impossible to sustain as a behaviour. Where everything is at risk, I might be more inclined myself to take a risk. Maybe I should jump ship and go to a competitor.
So purpose has become an issue for retention, for employee engagement, for attracting and developing the right talent; a matter, for many businesses, of existential survival. What your employees know, what they feel, how they behave in the workplace – be that workplace in a building or distributed among multiple Zoom or Teams accounts – was never more important than it is today.
We’ve all been on a massive learning curve this year. But having to exercise those learning muscles gives better muscles for learning as we go forward. Let’s come out of this well, and not just well but better.