The greater good: total societal impact
Over the past few years up to 87 million people had their personal information harvested and used with the intent of psychological manipulation during political elections, a thought far from comforting. It is alleged that this data was likely used to gain more votes for political candidates in the 2016 U.S. presidential election, possibly altering the results. Facebook was the source of the information, and admits they made “mistakes” in how user data was handled. Cambridge Analytica denies engaging in any type malpractice with the user information. This powerful example shows the real impact social platforms and the internet can have on our world. Events like these bring with them the realization that with the power to influence societies, companies have the responsibility of contributing to the greater good.
What is the greater good?
Linda Fisher Thornton explains this idea as thinking beyond our own interests and actions, moving our focus to the interests of those we interact with, local communities, and the interests of those around the globe. Our decisions have the power to positively influence a better situation for everyone. As such, furthering the greater good would be supporting initiatives that: benefit others, raise standards of living, make healthcare accessible and affordable, protect the environment, protect privacy, ensure just legal systems, and in general increase the well-being of a community or society.
Shifting to total social impact
It’s no secret by now; there are significant benefits of having a corporate strategy that takes responsibility for being socially aware and engaged in a worthwhile cause. Those are the companies where great employees want to work. Their customers are willing to pay more for their products and services because their business strategies are helping to contribute to a higher cause. These efforts have been practiced through environmental efforts, philanthropy, ethical labor practices, and volunteering.
Wendy Woods, a leader in social impact strategy at BCG, discusses in her Ted Talk that while she’s personally seen the benefits of these corporate initiatives in action, much more needs to be done to solve real-world problems. “The only way we’re going to make substantial progress on the challenging problems of our time is for business to drive the solutions.”
Corporate Social Responsibility (CSR) was never designed to scale and unfortunately, becomes one of the first programs cut when companies run into tough times. Therefore, CSR isn’t the long-term answer, instead companies should look to total social impact as a new standard for furthering the greater good. “TSI is the sum of all ways a business can affect society, by doing their real work, thinking about their supply chains, working on their product and design processes, and distribution” TSI focuses on social and environmental considerations, integrating and implementing them as core business strategies.
Total Shareholder Return (TSR) has long been a key metric in determining strategy and making important decisions. With TSR in mind, it would seem that implementing a TSI approach could negatively impact overall numbers. In a Boston Consulting Group study, they were able to identify multiple positive effects of having TSI incorporated as a core business value. As a result of this strategy, each sector they studied saw considerable increases in their total valuation and gross margins.
TSI in action
Mastercard — Mastercard has as committed to helping displaced refugees access their finances. By partnering with various aide organizations, they have been able to offer vital services to those in need. Digital networks allow access to education and financial distribution, prepaid cards for cashless payment, and digitizing supply chain tools all have had a positive effect on those displaced from their homes.
Microsoft — Microsoft has many current projects like “Seeing AI” a talking app that helps the visually impaired navigate the world around them. Their latest project was the launch of “AI for Accessibility,” with the goal of empowering people with disabilities. Only one in ten people with disabilities have access to assistive technologies. Microsoft hopes that by making these technologies and products more accessible they can make a profound impact on those navigating the challenges in their lives.
“The business of business is improving the state of the world.” — Marc Benioff, CEO Salesforce. Salesforce has implemented a simple, yet effective approach to having a greater total social impact. They use the “1–1–1 Model”:
• 1% of Salesforce’s equity is set aside to deliver grants in the communities where Salesforce employees live and work.
• 1% of Salesforce’s product is donated to nonprofits and educational institutions.
• 1% of Salesforce employees’ time is donated to communities around the world.
Adopting a TSI strategy
Many benefits come from the use of total societal impact as core principle and guiding strategy. While it may seem like a daunting task to align your current strategy with a worthwhile cause, this Forbes article by Dr. Bob Eccles, offers an excellent guide on what to consider when getting started:
1. Understand where you are and where you need to go
2. Create a clear story of why TSI is key to business strategy
3. Organize a list of scalable initiatives applicable to your business
4. Partner to further your impact
5. Determine goals and required metrics to measure impact
6. Involve key stakeholders in issues important to them
7. Communicate initiative information to investors
8. Consult with the board of directors
It is apparent that implementing a TSI strategy is a clear win-win. Businesses are able to significantly increase the value of their companies, create strong and loyal customers, while boosting their bottom line. Communities and societies around the world benefit from a higher standard of living. Making a lasting impact for the greater good is great insurance for a company to stick around for the long-run.