In our course Organizational Culture: Professional Certification Program, we claim that companies focusing on purposeful profitability, are very successful in terms of financial performance but most importantly, they are successful in driving positive change in the world.
A recent HBR article by Polman and Winston called “The Net Positive Manifesto – is the world better off because your company is in it?” is a great addition to the topic of “Leading with a Purpose” that we strive to promote at Amsterdam Strategy and Culture School (ASCS).
For the original article, please refer to: https://hbr.org/2021/09/the-net-positive-manifesto
In the September-October 2021 edition of Harvard Business Review, Paul Polman – former CEO of Unilever, cofounder and Chair of IMAGINE – and Andrew Winston, one of the world's most widely read writers and thinkers on sustainable business – provide us with their view on why companies should strive to become ‘net positive’, which is described by the authors as ‘improving well-being for everyone they affect – every product, operation, and stakeholder, including future generations and the planet itself’.
Besides promoting their new book ‘Net Positive: How Courageous Companies Thrive by Giving More Than They Take’, Polman and Winston make a strong case for why it is important to leave the traditional idea of corporate social responsibility behind and focus on a new approach that emphasizes a company’s purpose and overall impact on the planet.
Polman and Winston describe their idea in detail and provide several pieces of advice and examples on how companies can become net positive. One of their key arguments is that net positive companies will not only avoid existential risk by making themselves vulnerable to increased public criticism for socially and ecologically irresponsible actions - they might also profit from an opportunity to globally unlock ‘trillions in value and create hundreds of millions of jobs’ by meeting the UN’s Sustainability Development goals.
Quintessentially, four critical paths should be taken that will be laid out subsequently in some detail and put into a ‘culture & leadership’ context:
1. Operate first in service of multiple stakeholders.
2. Take full ownership of all company impacts.
3. Embrace partnerships and work with critics.
4. Tackle systemic challenges with net positive advocacy.
PATH 1 – ‘Serve Stakeholders, THEN Shareholders’
While we are undoubtably in an 'era of shareholder obsession', businesses traditionally followed a more stakeholder focused approach, typically derived from a purpose to serve. Recalling the old days of stakeholder-centricity, Polman and Winston suggest rethinking shareholder value as an outcome of stakeholder-centric initiatives. The authors describe Unilever’s Lifebuoy campaign in cooperation with UNICEF – one of many purpose-led brand initiatives under Polman’s lead at Unilever – as a successful example of intertwining company goals with social problems. Besides its positive effects on the public perception of a company, serving a purpose is a key motivational factor with an impact on employees work engagement far beyond the typical transactional employer-employee relationships.
PATH 2 – ‘Taking ownership of all company impacts’
The second path aims at rethinking how companies can take more accountability for their impact on people and planet. Polman and Winston emphasize the fact that stakeholders increasingly encourage companies to reconsider their codes of conduct by reminding them of their influence on our daily lives. In addition, stakeholders expect companies to be able to evaluate and measure said influence. As a part of this process, it must be understood how much ownership an operation can take for shared global challenges. According to the authors, it would be foolish to assume that a single company or person, no matter the size or influence, can take full responsibility any global challenge. Yet it seems rather anachronistic to refuse any accountability.
PATH 3 – ‘Embrace partnerships and work with your critics’
The third path focusses on how companies can engage in partnerships and cooperate with critics to take on bigger challenges that lay outside their individual control. The authors state that ‘when companies partner with peers on low-risk efforts that make everyone more efficient and sustainable, they create space for tackling harder, more systematic problems.’ With today's advancements in technology, the possibility to rapidly exchange information and the vast availability of data to identify and react to emerging trends, cooperating with partners and critics outside an organization can work as an early warning system for nascent challenges while inviting sceptics to openly discuss issues can build valuable relationships and trust.
PATH 4 – ‘Change systems with net positive advocacy’
Whereas the first three paths explore on what must change within a given system to become net positive, path four focusses on what can be done to change the system itself. The authors promote an approach to actively and constructively participate in the design and adaptation of policies and regulations instead of solely adhering to or working against them. The key message here is proactivity: ‘Net positive companies propose solutions rather than wait for (or complain about) regulations that tell them what to do’.
CONCLUSION – ‘Net Positive Purpose’
It is no secret that every company has a reason for being – a purpose. And, according to the authors, purpose can help achieve the challenging goal of becoming net positive. Surely, not every company has comprehensive records of what its initial purpose once was to what it is today. Even the current reasons and intentions behind a business might not be clear to everyone in the organization. Yet identifying a company’s purpose in the light of today’s planetary challenges can be inspiring and act as a trigger for understanding its responsibilities towards people and planet.
In summary, the authors promote a paradigmatic shift that requires thoughtful and persistent work. Their claims and proposed solutions can appear idealistic and in conflict with traditional ways of conducting business. Nonetheless, while solving any of the bigger planetary issues is a task that requires long term commitment and determination, the urge to act from a practical and moral standpoint is clear and initial success stories emerge. Therefore, the core messages of ‘The Net Positive Manifesto’ should at the very least serve as a starting point for immediate reflection.
Please check our Professional Certification Program on Organizational Culture.
Author: Marcus Lycke