The adage, “rules are made to be broken,” is not something that is often associated with commercial enterprise. Certainly, it is in every business’ best interest to obey the rules and color inside the lines. That said, as commercial enterprises go about the business of their business, the choice each faces is one of color palette: black and white or the full spectrum?
Many seem to be confusing the mandate to do what is right with the opportunity to do what is right in a way that has more impact, creates more value, and reaches stakeholders with greater resonance. As evident in Edelman’s 2012 Trust Barometer and goodpurpose® surveys, business seems to be ignoring the appetite, if not growing demand, for Purpose and societal benefit to inject technicolor into its operations.
Let’s look at the data: 87% of global consumers included in the goodpurpose® study believe business needs to place at least equal weight on society’s interests as on business’ interests. Yet, less than a third of those same consumers believe business is performing well in addressing societal issues. Additionally, when we asked Trust Barometer respondents what attributes matter most for global business to build trust, they said “listens to customer needs and feedback,” “offers high quality products and services,” and “treats employees well,” were the three most important attributes. By contrast, “delivering consistent financial returns to investors” and “having highly-regarded and widely admired top leadership” ranked near the bottom of what mattered most in building future trust.
Certainly financial returns matter. No one questions that the commercial enterprise must remain commercially successful. That said, how success is achieved is where the opportunity for leadership is found. Operational excellence is a requirement but today that must be coupled with societal value creation as well. Nearly half (49%) of goodpurpose® respondents said they believe companies should be creating a product or service that helps address a societal issue.
Today, business must embrace its role as global citizen and problem solver. To that end, enterprise should not soften its hard, historical drivers – efficiency, supply chain management, sourcing – rather, business should look for ways to infuse each with the color of Purpose and societal value. From IBM’s Smarter Planet to GE’s ecomagination (disclaimer: Edelman client), companies are embracing the leadership opportunity offered by Purpose-driven strategies. These leading enterprises have come to recognize that what was sufficient is now table stakes.
Respondents of both studies tell us they expect more from business…and we know they’re watching. In today’s hyper-connected, 24/7, always-on world, the good news is, being caught in the (consistent) act of leading is the opportunity. Yes, business must deliver goods/services of value to realize value; but, more than ever before, how you do what you do is as important as what you do. Certainly, rules based performance is not wrong, but it is principles based, technicolor leadership that allows business to earn the license to lead.
By: Ben Boyd, Global Pratice Chair, Corporate, Edelman