When I first started at CCF, the team had just completed a report called “The consumer of the future” for our client Johnsonville. Wrapped neatly inside two gigantic three ring binders and probably 300+ pages of PowerPoint slides was this little nugget: Nutraceuticals would become a major benefit to consumers. There were other nuggets foretelling the rise of a more Conscious Consumer. That was 1998.
When we earnestly began studying Conscious Consumers in 2014, our report with Mintel indicated that consumer behavior was at a tipping point. Today it’s more than a nugget about the future. It’s a full-on trend that reaches well beyond any one category and into any business that wants to exist five to ten years from now. In fact, just last month the Business Roundtable issued an update for their Statement of Purpose. The letter was signed by 181 of the nation’s top CEOs including Apple’s Tim Cook, Best Buy’s Corie Barry, Larry Fink of BlackRock and 178 others. For the first time, they put people before profits: investing in employees, working fairly and ethically, supporting the communities they work in, and lastly, generating long-term shareholder value. Not since 1997 had generating shareholder value held anything but first place.
As for BlackRock’s Larry Fink, it appears he beat his peers to the punch. In January, he stated the importance of “Purpose as the animating force behind profits.” BlackRock is the largest investor worldwide overseeing $6 trillion in assets.
“Profits are in no way inconsistent with purpose. Purpose is not the sole pursuit of profits, but the animating force for achieving them.”
-Larry Fink, BlackRock
Gone are the days of writing a check to launder intent. You need to demonstrate it. Live it. And own it as a core part of your culture. It needs to show up as a success measure in your annual reports. 64% of Americans say a company’s primary purpose should be making the world a better place. 41% of Fortune 500 CEOs say that solving social problems should be a part of their business strategy. Those numbers with Millennials, the next generation of our corporate leaders, is even higher.
The endeavor of being a better corporate citizen should not be looked at as an expense or a drain on profits. As Fink suggests, they should be a force for profits. Just look at Toms Shoes, Warby Parker and most recently Impossible Foods. Impossible is leading a category that is expected to jump from $800 million to $140 billion in the next 10 years. As both a company and category, they are about more than just eating healthier. They are better for the planet, using far less water and land in production with a carbon footprint that is less than 1/10th the footprint of a traditional beef patty.
Being a good corporate citizen is no longer a badge you wear to keep detractors at bay. It needs to be baked in to who you are. A while back I closed a post with “The train is leaving the station. Time to get on board.” Well, the train has left the station and if you missed the first one, you’d better catch the next one or you will be left behind.