In the year of lockdown and Black Lives Matter, we’ve become used to business leaders sounding more like activists than traditional CEOs – more likely to quote Colin Kaepernick or Greta Thunberg than Milton Friedman, the Nobel-winning economist who argued that a company’s only real responsibility was to its shareholders. Whether it’s Uber, Starbucks or OkCupid, companies are realising that, as a report by data and insight consultancy Kantar outlined earlier this year, 68% of American consumers expect brands to be clear about their values and take a stand on them.
But with so many brands shouting about their sustainability and diversity credentials, consumers have also become quicker to call out greenwashing, woke-washing, purpose-washing and more.
‘We’re moving into what we call the post-purpose phase,’ says Victoria Buchanan, senior futures analyst at The Future Laboratory. ‘Especially after lockdown, when people are reflecting, consumers will increasingly judge brands on what they actually do. It isn’t enough now to just have a rainbow flag or a BLM message or talk about the triple bottom line. There needs to be evidence of action.’
‘It isn’t enough now to just have a rainbow flag or a BLM message or talk about the triple bottom line. There needs to be evidence of action.’
Finding that evidence is getting easier. There are now more than 3,393 certified B Corporations, a values-based standard created by Pennsylvania non-profit B Lab. Operating in 71 countries, these run across 150 industries, from small startups to giant brands such as Patagonia, Warby Parker and Ben & Jerry’s. Independently judged on five key areas – governance, workers, community, environment and customers – the B Corp mission is to move from shareholder capitalism to stakeholder capitalism, and create ‘a global economy that uses business as a force for good’.
Many of these businesses used to be dubbed ‘sacrificial brands’ – the inference being that promoting values meant sacrificing profit – but the latest evidence suggests the opposite. A 2018 study in the UK found that B Corp businesses were growing 28 times faster than the national average, while B Lab announced last year that 120 venture capital firms had invested $2bn in B Corps, which tend to spend less on attracting increasingly aware consumers, clients and employees.
‘Everything we’ve learned from the B Corp community has helped the business,’ says Rob Wilson, CEO of Toast Ale, a small London-based brewery that makes beer using discarded loaves of bread and donates all profits beyond wages and basic costs to food charities. ‘Whether it’s having better maternity or paternity leave, or being even more transparent about our shared ownership and where our profits go, we’ve seen the business grow.’
The clarity of Toast Ale’s core message about solving food waste issues has helped it thrive in a busy sector, seeing the beer sold in supermarkets such as Waitrose and Tesco, and on online delivery service Ocado, which has helped it weather a downturn in hospitality demand during lockdown. ‘We’re at the small social enterprise end of the B Corp spectrum, but we’re still a business,’ says Rob. ‘You can sell one bad beer on a social message, but not more. We need to make delicious beer. But it increasingly seems like common sense that strong, clear, transparent values mean better business.’
Frankie Reddin is a communications consultant in London, specialising in food, drink and culture.
‘Since Covid-19 came along, we’ve been hearing from a lot of restaurants about how important coming together with our local community is. Without restaurant critics or PR companies to shout about them, restaurants have had to rely on their communities – and remind them that they exist – more than ever before.
But in London – and all major global cities – we only hear about aspirational, modern, no-booking locales that, realistically, only serve a small percentage of wealthy inhabitants. The real local heroes, the Vietnamese, Caribbean, Ethiopian, Nigerian and Chinese restaurants plus the English chippies are generally shunned, which makes it harder for them to achieve the success they deserve.
I founded A+F Creative four years ago because I was sick of the food PR formula. Only those who have enough money – usually white and middle class – are able to hire a PR agency, while the media gatekeepers decide that local restaurants are just not interesting enough for their audiences to read about. PR is littered with young, posh girls who are not inept at their job by any means, but they are out of touch. They haven’t been to my favourite Turkish on Green Lanes and probably never will.
At a time when I was feeling quite bored and tired of the ‘scene’, Island Social Club appeared. A contemporary social space that shares modern British Caribbean culture through food and drink, founded by two Caribbean Londoners, Marie Mitchell and Joseph Pilgrim, who pride themselves in serving you. It has community at its core and is a hub for exploring and engaging with today’s British Caribbean culture. I reached out to them because it was what has been missing from the reams of food articles I read. Also with one of my parents hailing from Dominica in the Caribbean, I saw myself for the first time within this industry. I offered to work with them pro-bono (and for some food) to prove that PR can be useful. And through the duration of a year, we achieved some great media attention through a lot of hard work.
But this is the exception to the norm. It’s a shame that, in the food world at least, genuinely caring about your local community doesn’t often pay off.’
Courtney Caldwell is co-founder of ShearShare, an online platform for beauty and barbering professionals to rent workspace by the day, while salon and barbershop owners make money on unused space.
‘I live in McKinney, Texas, with my co-founder husband, Dr Tye Caldwell, who has been in barbering for nearly three decades. Our goal is to create more than a million jobs for beauty and barbering professionals within the next four years and to maximise their earning potential. And since Covid-19 – which saw 55% of our industry professionals losing work almost overnight – we’ve doubled down on our mission.
Today, we have customers in more than 672 cities and 11 countries worldwide. And our data is telling us we are feeding not only industry recovery but also helping to grow the local economy. Regardless of the size of the city, there will always be a church, a post office and, by golly, there will always be a salon or local barbershop. Thankfully, as the US starts to open up again, our company is seeing numbers off the charts. We owe everything to Tye’s first salon and our grassroots mentality. We wouldn’t have been able to scale a tech company without either.
Before ShearShare, we knew nothing about the tech or startup worlds – and that has turned out to be a strength. We tell fellow salon owners we know their day-to-day challenges and troubles, because we’ve been there, and they always say: ‘Man, I’m so glad you aren’t two random engineers who thought that they came up with the best idea since sliced bread for our industry. You totally get us.’
Central to how we run our business is maintaining our presence in the community. As Black tech founders, we want to be there for our people. There was no black Bill Gates out there when we were at school. Meanwhile, we’ll always remember the time we cold-emailed Joe Gebbia and he invited us out to Airbnb’s headquarters. He told us how much he hated how the company had got away from the face-to-face, tight-knit community they had in the early days.
In order for communities to trust you, you have to be visible on the ground. For us, growing a profitable business and being there for the community are absolutely one and the same.’
Meera Clark is a senior associate at Obvious Ventures, which invests in 57 tech-enabled businesses with a ‘world-positive’ social mission, from man-made diamond company Diamond Foundry to wellbeing therapy company Octave.
‘We believe that companies with a world-positive approach will outperform those that don’t over the long run, because both customers and employees are getting smarter and raising their expectations. Companies that lack a clear mission, or see their goal as exclusively driven by the bottom line, will simply be left behind.
All of this was true before lockdown, but there’s an even greater sense today of people resetting and re-evaluating their decisions.
At Obvious, we encourage businesses to draft a World Positive Term Sheet – an open-source document on our website – which provides the opportunity to outline their values, diversity, sustainability and giving goals. We’ve seen strong positive correlations between these values and companies’ bottom lines. More culturally diverse teams have also been proven to drive better financial results, and we’ve seen that brands with a social aspect to their mission have to spend less to acquire new customers, and find it easier to attract the best talent. It’s a virtuous cycle, which ultimately drives profit.
Clarity is key, too – we look for businesses that are solving societal challenges. Even for the smallest startups, knowing the ‘why’ of your business is crucial, and will help you grow in the right way. That ‘why’ can’t just be to make money, because consumers, employees and investors won’t buy into that.
They also want to see that a company lives by its values. If you can ingrain those from the beginning, you’ll have a real head start over your competitors. It will be interesting to see whether this kind of community engagement will continue.’