We were delighted to welcome Norman Pickavance to the panel at our last webinar, looking back at how 2020 has changed the rules around purpose in business and moved us forwards towards new ways of working.
Norman is a great friend of Verity London, and does amazing work delivering transformational change as the CEO, Co-Founder and Director of the St Paul’s Institute, Tomorrow’s Company and The Financial Inclusion Alliance. Norman’s written an exclusive article for Verity London, challenging some of the current assumptions around businesses putting Purpose into practice.
A must-read for anybody serious about organisations becoming more purposeful, this is worth taking twenty minutes out with a cuppa. It’s inspiring. We’d love to hear your thoughts. If you missed the webinar, you can watch it HERE.
We have never been more in need of Purpose-led organisations than we are today. Society is aching to come together in new ways [1]. Yet this pandemic has also been a national tragedy. It has exposed the failings in our economy, shown us just how fragile we are, and has cruelly exacerbated existing inequalities in our society.
So, whilst the aspiration to build back better are upon everyone’s lips, we must understand what it will take to put good intentions about Purpose into practice, and find ways that show an increasingly mistrusting public that there is more to this wave of optimism about the role of business in society than the latest corporate spin or advertising campaign.
In the spirit of these times, The British Academy articulated the role of Corporate Purpose in the following way;
““The purpose of business is to profitably solve the problems of people and planet, and not profit from causing problems”.”
I’ll be looking at the current context, consider what is motivating business to change and mapping out some alternative steps that organisations should take if ‘Purpose’ is to reside at the heart of business thinking and deliver on its potential to be a driver of positive change.
2019 seemed like a tipping point on the road to purposeful business. The US Business Roundtable announced that the new purpose of business was to ‘serve all’ stakeholders in society, and the British Academy launched its ‘Principles for Purposeful Business’. Then Covid happened, Western Economies were shocked out of complacency and in the months that followed the number of Google searches for responsible investment went up 119%.
Everyone it seemed, recognised that the world wasn’t quite as benign a place as they had thought –the number of ESG Funds rose as report after report highlighted that younger people [2], in particular, wanted their money to do good and have a positive impact.
However, summer has passed, and we are headed toward a long Covid Winter. The mood is darkening. Public protest over race and regional inequality have mounted, and real hardships amongst poorer sections of society have filled our screens. Yet, even, bigger clouds now loom.
In a recent interview [3], former Governor of the Bank of England, Mervyn King, and former UK Chancellor Alistair Darling, reflecting on their experience of managing the Banking Crisis of 2008, observed that 2021 would produce a recession of unprecedented scale. They forecast that many nations may well follow Argentina and default on Covid linked debt, and that the UK government would be presented with a set of dilemmas for which normal fiscal remedies probably would not work.
The Pandemic could set back progress towards the UNs sustainable development goals back by at least a decade. We face a set of scenarios that will strain the bonds between and across society in ways not seen since perhaps the 1930’s.
It means that the need for business to be ‘doing well by doing good’, could not be more important, but getting there may have become a whole lot harder.
It is vital therefore that we are clear about what Corporate Purpose is really about and the practical steps business can take to move forward on the road to becoming purpose driven, what is really holding some businesses back and what new approaches we might now adopt.
As more organisations announce that they have discovered their corporate purpose and more articles are written about what it takes to become a purpose-led organisation, it would be easy to think we have already reached a great tipping point.
As recently as October 2020, research highlighted that the number of leaders who believed business should be Purpose-led was now neck and neck [5], with the number who still say business is only here to serve shareholders. The British Academy have analysed what is holding some business back. In a YouGov survey, they asked; What are the most important factors holding back the development of purposeful business in the UK, and what would help to move us forward. The survey found that:
A paper summarising these findings also found that; Business leaders want it to be easier to identify who purposeful businesses are so that ‘they can stand out’. They wanted to have clearer legal frameworks consistent with being purpose driven, they wanted it to be ‘easier to attract investment’ to purpose driven businesses, and they wanted ‘impact measurement to be simpler’.
At first glance these findings and the recommendations that flow from them could not be more straightforward. Indeed, the pioneering work of the B-Corp movement has pointed in this direction for some time. But let us step back for a moment. Are business leaders really saying that they need more ‘praise, incentivisation, and rules’ in order to do the right thing?
After all that has happened in 2020, is that really still the case?
Perhaps we should probe these responses a little further to challenge some of the assumptions that lie behind these observations:
That is not to say that the things identified in the YouGov survey wouldn’t help, but are we really suggesting that we are being held up on The Road to Purpose by these largely extrinsic factors? Perhaps we are? If so, I suggest we need a shift in perspective, and instead to turn to our own organisations, to ourselves and our own motivations to find better answers. Including the importance of developing virtue and character as keys to travelling far on the Road to Purpose.
Working without the commute, the fortunate amongst us have been able to spend a bit more time reading and ‘occasionally’ thinking. On good days, the long lockdown has felt like a giant ‘retreat’, punctuated by zoom calls with others from their own monastic cells (home offices). My personal reflections led me to a book by Pulitzer Prize winning author, Hisham Matar.
‘A Room in Siena’, is about the author’s life, a year on from the tragic death of his father. Matar tells of his visits to the Palazzo Publico, in Siena. His contemplation there is centred on a large fresco, ‘The Allegory of Good Governance,’ which captures how life, commerce, and society in Siena became stable and prosperous for citizens during the middle ages. Painted by 12th Century artist Ambrogio Lorenzetti, the fresco which is as large as a tennis court, depicts still recognisable walls and streets of Siena.
In the foreground are a group of people, collected like actors in a stage play. At the paintings centre and larger than all the other figures, sits a character representing the ‘Common Good’. He is flanked on either side by the virtues. To his left sits justice, alone, then peace, fortitude, and prudence and to his right magnanimity, temperance and once again justice. Justice then is represented twice, and on each occasion by a woman. Beneath these imposing figures are the merchants, magistrates, and common people of Siena, all holding onto the same silver thread, connecting justice with justice.
The painting is meant to be read from left to right, from serenity and grace, to the final image. A shocking scene of Justice holding up the severed head of a prince in one hand, and his crown in another. Staring blankly back at us, the prince seems to be saying that we should beware being consumed by our own pride or forgetting justice. Consequences in the middle ages could clearly be stark! The fresco served to remind leaders of the day, that no one should think themselves too great, that they all shared in serving the common good, but that in doing so they would needed to be guided by a series of virtues. Indeed, Hisham observes that Justice seems to be saying that she is the ‘normative state, free from corruption, concerned with balance, a state in which all things will find equilibrium.’
This painting reminds us that the Road to Purpose is an ancient ideal and that we have much to learn about what it involves. The notion of building ‘a city on a hill’ reflects the best of us, but that this can get tangled up with our lesser aspects of the human condition. Indeed, Lorenzetti seems to go further, that whilst we may all aspire to something better, if we are to travel well on The Road to Purpose we need to practice and honour the mechanisms of Virtue and Character if we hope to stay the course
Perhaps the ‘Allegory of Good Governance’ reminds us that we should not see ourselves at the centre of the story, nor imagine that our companies are independently here to ‘solve the world’s problems’, yet each free to do so as they choose. Rather, that we are all connected actors, part of a bigger whole, each contributing toward the common good, yet no greater than all others in society. Indeed, if the painting contains a truth for our times it is that the Road to Purpose will require new forms of collaboration. It also powerfully reminds us that the Road to Purpose will not always result in external reward or recognition, rather that it will be a test, and that we may fail in its pursuit. The painting offers that the reward that lies along the road to purpose may not glitter but involves something deeper in ourselves. It is a different way of thinking about Purpose. It is perhaps what President Roosevelt had in mind when in the 1930’s he invited business leaders to work with him to be stewards of the economy as he looked to rebuild both the economy and public trust after the Great Recession.
If we are here to help solve the world’s problems, then we must embark in such a way as to also make the world a more just place.
Given such a shift in perspective it would be surprising if all the tools and process used to build the corporate sector over the past 30 years could be the ones that took us far on the new Road to Purpose.
So how does becoming Purpose Driven look and feel different to normal business processes?
Here are just two examples.
At the hight of the Greek Financial Crisis in 2015, it looked like Greek debt would force its exit from the European zone, there were riots on the streets and a near banking collapse.
I was working at Professional Services firm Grant Thornton at the time and had taken a group of CEOs from many different country operations to Athens. We were there to consider the changing role of leadership and to support the Greek management team in developing a new strategy.
Rather than spend several days in a room with flip charts and consultants, we went out into the city and met with the heads of one of the major banks, who told us how the crisis was effecting them. We met pensioners in cafes who told us how they had lost all their savings and graduates who could not find jobs. We met entrepreneurs who were hoping to get their new businesses off the ground, refugees in camps who had fled war torn Syria, and we visited artists who were trying to tell the story of what was going on around them.
Each evening we came back and shared our varied and often emotional experiences with each other. With the help of personal reflection and group work we all tried to make sense of what this chaos meant for each of us. The following day we brought a group of future leaders from our Greek business into the workshop environment and asked our experienced CEO’s to share what they had found.
There was no rehearsal, no time to prepare slide presentations, the CEO’s were no longer experts. It was a raw examination of partially formed impressions and personal feelings. It was intense. It challenged our CEO’s perception of what it meant to be a leader in the modern world; but perhaps most importantly, the encounters inspired the Future Leaders from the Greek business, who decided that they needed to turn their business plan on its head. Rather than deciding and planning what services they had to offer to the Greek business community, they started to map what needed to be done to serve society in Greece, how their skills could better support others. It was a first step on the road to becoming a purpose driven business.
This session, and others like it, were never comfortable affairs. On one occasion in the UK, a senior leader angrily complained that they had ‘no desire to have to meet people who were struggling to pay both their energy bills and to put food on the table’. By going out into the world, it reminded us that we each live in our own bubbles no matter how enlightened we may think we are, and caused us to confront the realities of what a more just world might actually involve.
Once you have unearthed a compelling purpose the difficult job of exploring what it means really starts. How will each of your critical business practices need to change to better reflect the contribution you hope to make to the common good, and how will your actions in all parts of your organisation become congruent with this?
At Grant Thornton we arrived at a Purpose through deep consultation across the organisation. It envisaged the organisation supporting the development of a vibrant economy.
What then of those clients who did not fit that mould? Was it ok to work with people who seemed to be aiming towards different ends, provided that it was profitable for the business to do so? Or should we stop all such relationships immediately and potentially harm the short-term viability of the business?
We agreed that we would introduce a new client review process, with an additional step which mapped new or continuing client relationships against the same criteria that had emerged from the development of our Purpose. Getting to this point however also proved an uncomfortable process. Sales, and heads of business, found such reviews questioned their instincts about growing the business.
It highlights that the process of moving from a fragmentary life within an organisation to a cohesive one committed to a purpose requires that we close off certain possibilities. It involves both difficult choices and a recognition that we may not always be able to live up-to the standards we may aspire to. That we are indeed flawed. In this recognition perhaps lies one of the biggest challenges for all businesses. The recognition that they are not perfect. In this sense the Road to Purpose is one that is often long and can require us to experience humility, a quality rarely talked of or admired in business circles. (though it is a quality you still find in many family-run organisations.) Indeed, as we learned from the fresco in Siena, it is so often pride that blinds us to our weaknesses and can lead us into thinking that we are better than we are.
Deeply changing business practices will take time. As David Brooks [7], suggests, this is not about always winning battles. The most important thing is to engage in the struggle, recognising that there may need to be sacrifices along the Road to Purpose. As in our personal lives, finding ways to share these struggles, and sometime failures, with the world is never going to be easy. It requires a new and more honest form of communication with investors, employees, customers, and commentators. It highlights that the Road to Purpose is never only be about solving the world’s problems. Quite often it requires first that we solve our own.
I’ve talked about the most recent developments on the Road to Purpose Driven Business. And have highlighted that, whilst there is much wisdom advocating for greater business incentives, clearer legislation and measurement, these changes in the rules of the game may not in and of themselves lead to the breakthroughs in corporate behaviour we all hope for.
We should look beyond traditional business tools and consider how we change the hearts and minds of leaders in our institutions. Such a change may sound soft, but it probably represents a far greater challenge, an examination of ourselves.
Words like character and virtue declined in use through the 20th Century. Words like Courage by 66%, Gratitude is down by 49%, Humbleness is down by 52% and Kindness is down by 56%. Such ‘words and ways’ have slipped out of regular business vocabulary. Yet the Road to Purpose, requires that we embrace them. For achieving a higher purpose does represent a noble undertaking and as such a deeper commitment than we normally engage in during the transactions and hassle of daily business. It requires, whether we like it or not, that beyond ‘winning’ we include a search for Justice and Mercy for Temperance, Patience, and Fortitude. It involves wrestling with our weaknesses and being made better by this struggle. It involves finding our anchors and permanent convictions that hold us to the important things we are endeavouring to achieve.
‘The Road to Purpose’ may well take longer to travel for most corporations than the tenure of any one leader but it will build the character of people within the organisation and create businesses that will be trusted over time, that we can all believe in.
For inspiration, I finish with extracts from two 20th Century speeches that capture the spirit of the challenges we face on The Road to Purpose.
““We choose to go to the moon in this decade and do the other things, not because they are easy, but because they are hard, because that goal will serve to organize and measure the best of our energies and skills, because that challenge is one that we are willing to accept”.”
— (JOHN F. KENNEDY, HOUSTON, TEXAS, 1962)
““I have a dream, that one day this nation will rise up and live out the true meaning of its creed…. I may not get there with you. But I want you to know tonight that we as a people will get to the promised land.””
— (MARTIN LUTHER KING, WASHINGTON, 1963)
———————————
References
[1] Levelling up our communities (The Kruger Report September 2020)
[2] Economic Intelligence Unit – RBC report (New Wealth Rising – the future of wealth)
[3] Tortoise – On Line Slow Newscast – with Editor James Harding (October 2020)
[4] Regenerate – Discussion Paper – What is holding purpose driven business back? (2020)
[5] YouGov Poll conducted on behalf of the British Academy identified that 44% of business leaders believed that the purpose of business should serve society, whilst 44% believed purpose of business was to serve shareholders.
[6] A Month in Siena, by Hisham Matar. Published by Penguin (2019)
[7] The Road to Character by David Brooks, Penguin (2015)
