1 in 3 CEOs state that social purpose is at the forefront of their strategy
"To be truly successful, companies need to have a corporate mission that is bigger than making a profit." The quote is from Marc Benioff, founder Salesforce, but it could have come from a long list of activist CEOs.
Sir Richard Branson, for example, is a passionate believer in putting mission before profit. He said: "I think if the people who work for a business are proud of the business they work for, they'll work that much harder, and therefore, I think turning your business into a real force for good is good business sense as well."
Under Amour founder Kevin Plank (pictured with Branson) was a late convert. "One of our first customers asked me how big we want to be," recalled Plank. "I said I want to be really big. Later, it bothered me that I answered that way. Now I say I just want to be a great company."
Unilever, P&G, and Blackrock, the hedge fund manager controlling $9.5 trillion in assets, are all vocal about the importance of social impact.
New research suggests this mindset is now mainstream.
Almost a third (32%) of CEOs say that social purpose is at the forefront of their business strategy, according to ECI Partners’ new Growth Characteristics report.
For smaller companies the trend was nearly universal. A remarkable 95 percent of business with between 10-49 employees state that social purpose informes their business strategy.
The survey looked at more than 500 fast-growth SMEs in order to research what makes a successful CEO.
CEOs in the education sector were most likely to emphasise the role of social purpose in shaping their strategy, at 92%. This was followed by those in HR (90%) and financial services (86%).
Laura Morrill, Investment Director, at ECI Partners said:
“Ultimately, unless companies consider, articulate and demonstrate purpose as part of their overall strategy, it will have an impact on their growth now, and in the long-term. It could impact anything from customer acquisition to talent retention as employees want to work for businesses that demonstrate their values. Moving forwards, we predict that social purpose will increasingly become the norm when it comes to businesses’ strategic ambitions, and it will continue to be a key consideration for investors.”
Sara Axelbaum, Global Head of Inclusion and Diversity at MiQ, an ECI portfolio company:
“The ‘Great Resignation’ has shown us that the precarious professional world that we were previously relying on was unsustainable, and that ‘bad’ behaviour was accepted. The pandemic made people more introspective about how they want to spend their waking hours, and many realised that they want to spend their time with a company that actually cares about them and the world around them. It has become a competitive advantage to give a damn about the people at your company. Beyond being the right thing to do, you can’t afford not to anymore.”