Increase Profitability by Becoming a Purpose-Driven Business

Before we delve into the reasons why it makes sense to have a purpose, let’s explore the statistics. After all, we do not expect you to simply take our word for it. The most compelling evidence has been provided by the Corporate Board/EY Global Leadership Forecast. They have revealed that purpose-driven businesses outperform on the stock market by a massive 42 per cent!

The report then goes on to compare purpose-driven businesses who embed their purpose into everything they do with companies that have a purpose statement but do not do anything more. The report concluded that businesses who do not embed their purpose into their vision, mission, and everything they do will underperform the market by as much as 40 per cent.

This indicates the importance of authenticity when it comes to having a purpose. It is not enough to simply state that your business has a social purpose. It is not enough to put a statement together and then forget about it. Being purpose-driven means exactly that; your purpose needs to drive your decisions and it needs to be a major factor in everything that your company does.

You may think that being solely focused on profit is the recipe for success. However, by focusing on making a social impact or an environmental impact, you can actually boost profit levels considerably. When your purpose is bigger than simply making as much money as possible, you will see results in terms of employee engagement and consume loyalty, and this, in turn, ends up driving greater revenue over the long-term.

This is something that we have seen assessed in “Grow: How Ideals Power Growth and Profit at the World’s Greatest Companies” by Jim Stengel. In this document, Stengel documents how 50 of the world’s highest-performing businesses have capitalised on brand ideals to beat their competition. In the document, Stengel reveals that the highest performers are brands that are created on ideals, i.e. a purpose that is bigger than their business and transcends their services and products.

Today, a lot of consumers are making their purchasing decisions based on how brands support the communities they operate in, how they treat the environment, and how they treat their people.