In 1984 two diametrically opposed things were supposed to happen.
One was George Orwell’s dystopic vision of the future. The other was the birth of a new era of corporate social responsibility.
Following a seminal essay by management guru Peter Drucker in the same year, companies were urged to not just think about how they fattened the bank accounts of their shareholders, but how they could also create social and environmental value.
In the last three decades, the following have become true.
Since 1990 we’ve pumped more than double the CO2 into the atmosphere. Investment in renewable energy went down in 2017 by more than $70bn. More than half (55%) of CEOs disagree that sustainability is important to their businesses.
Despite a global march towards equality a mere 43 out of the Fortune 500 CEOs are women. Less than 10%.
In Africa there are more than 50 million more “extremely poor” men, women and children than in 1990. 42 people still have as much wealth as the poorest 50% and, unforgivably, there are more than 40 million people in slavery across the world.
The world is still ill.
But the people who run it are changing.
By 2025 three in every four people in the workforce will be millennial. Our generation is a new power with very different expectations than our parents.
75% of millennials would take a pay cut to work at a purposeful company. 93% say they base their product preference on whether they believe a brand is purposeful.
So when we asked senior decision makers at companies – many of whom are increasingly of the millennial generation – whether investing in purpose is critical to future growth, more than half (55%) said yes.
Purpose is more than just righting wrongs or bringing net impact to zero. For the companies our inaugural Purpose Trends Report surveyed, the issues which will define purpose in the next five years are complex social ones. Automation (49%), mental health (40%) and gender diversity (30%) are top priorities, to meet the evolving expectations of the millennial generation.
So how do we get to a world where the default behaviour is driven by purpose? There simple answer is follow the money.
From Blackstone to Legal & General, investors are driving a higher bar of expectation. 45% of respondents to the FHF Purpose Trends survey said lack of investor impetus was the main barrier to purposeful change.
And if you don’t believe change will come from investors, then be heartened by the ‘making it rain’ millennial generation who will pack $20 trillion of spending punch by the end of the decade.
A change is coming. And only the most purposeful companies – the ones who truly understand the millennial manifesto – will thrive.
To find out more about our new Purposeful Business division, please contact us.
Paul Afshar, Director and Head of Purposeful Business