Growing with a purpose to leave a social impact

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Growing with purpose to leave a positive social impact on the planet has not always been a priority for companies. Half a century ago, on September 13, 1970, Milton Friedman, professor at the University of Chicago, Nobel Prize winner in 1976 and great disseminator of the free market ideology, published an article in the New York Times Magazine entitled “ The Social Responsibility of Business is to Increase its Profits ”.

Friedman's doctrine, also known as shareholder theory (and arguably the antithesis of purposeful growth and social impact ), spread rapidly in a world immersed in a Cold War between the great superpowers and the two great economic theories: capitalism and communism.

For Friedman, in companies where there is a separation between owners how to get uk whatsapp number and managers, the latter are employees of the former and must therefore have as their sole objective the maximization of the company's profitability, which is what interests the shareholders-owners. A doctrine that valued the generation of wealth over the social responsibility of their activity and their legacy .

Companies must safeguard the planet
Half a century later, in the midst of a pandemic war against COVID-19 and in an ongoing battle to protect and safeguard the planet, the vision of the role that companies and large corporations should play is different . Values ​​have changed, and professional development and growth are no longer everything for people.

Candidates need to understand the purpose of the job they are applying for and companies need to know that they are hiring the best talent available to grow their business. In fact, HR consultancy Michael Page already pointed out in a report at the end of 2019 (before the start of the pandemic) that 90.3% of Spaniards wanted to work in socially responsible companies, revealing that society is demanding business management models that take into consideration the social and environmental implications of their actions, beyond the purely economic aspect.

An example of this is the so-called “great resignation” that led to more than 4 million Americans leaving their jobs last July alone.

From shareholder value to social value and impact for the parties
In this context, Friedman's theory begins to be discredited and new ideas and currents emerge that try to redefine the role that companies should play within society.

Thus, the Business Roundtable 2019, in a manifesto published in August 2019 and signed by 181 CEOs of the world's leading companies ( including Michael Dell, CEO and founder of Dell Technologies) called for a change in the traditional postulate of the need to create shareholder value , to evolve towards a model in which it is proposed to create value for all stakeholders (stakeholder value).

That is, ensuring the social impact of companies on employees, the local communities where the company operates, the surroundings and the environment...

For many, the overnight changes in the way we work and live and the challenges presented by the global pandemic have led society to begin to mobilize.

Thus, in recent years we have seen an even stronger call to action for companies to act, generating a positive impact for society , working on equal opportunities, guaranteeing sustainability , promoting the green economy and the circular economy, encouraging the resolution of social disparities by being more diverse and inclusive...

Many studies reveal that growing with purpose and promoting good business practices can be a game-changer . For example, a study by Accenture predicts that the circular economy will generate an additional $4.5 trillion of economic output by 2030. Meanwhile, another study by McKinsey suggests that the Asia Pacific region could generate another $4.5 trillion for the economy by 2025, if women’s equality is addressed.

A compelling business case for companies to grow with purpose
Throughout 2020 and 2021, more and more companies and governments have stepped up to make stronger commitments to tackle climate change and social inequality. At the G7 summit in Cornwall last summer, nations pledged $100 billion a year to help poorer countries cut emissions and a billion vaccine doses to less developed nations in need.

A particularly activist group driving change with social impact is the so-called Generation Z : those born between 1996 and 2010. In 2019, Generation Z became the largest generation in the world, making up one-third of the global population.

For example, a study of the UN Sustainable Development Goals that matter most to Generation Z in Asia Pacific ranked those related to reducing inequality and taking action against climate change at the top.