COVID-19 Will Push More Companies to Embrace Purpose, Says Social Impact Pioneer Carol Cone

In the years leading up to the novel coronavirus pandemic, major companies were beginning to embrace purpose on a broader scale. From the Business Roundtable's updated statement on the purpose of a corporation, to the World Economic Forum's 2020 Davos Manifesto encouraging a new social contract for the 21st century, it's clear business leaders were starting to recognize the imperative to prove why they exist beyond making money. 

Given market research detailing buyers' shifting preference toward brands with purpose, it's no surprise that consumer-facing businesses largely led the early purpose trend. In a study released in February, social impact pioneer Carol Cone — who has spent nearly 40 years helping companies discover their purpose beyond profit — took a closer look at what purpose means for another set of companies: business-to-business operations, or B2Bs. 

"We were surprised about two things when we first got the data back," Cone said of the research conducted by her New York consultancy Carol Cone on Purpose, in partnership with The Harris Poll and the Association of National Advertisers (ANA). "One is that so many B2B companies are embracing purpose as an important strategy: 93 percent are somewhere on the purpose journey. Then, we got to what we call the purpose paradox." 

In their survey of more than 250 B2B professionals, Cone and her partners discovered that while 86 percent of B2Bs have defined a purpose beyond profit, only 24 percent have embedded that purpose into their operations, culture and supply chain. They identified the discrepancy as a rift between "stated" and "activated" purpose. 

Then came COVID-19 and the ultimate test of what purpose really means for corporations, B2B or otherwise, when it matters most. 

"In the report, we recorded a huge chasm between stated and activated purpose. What COVID-19 is doing is closing that gap," Cone told TriplePundit. "You wouldn't wish this horrific situation on anybody to close that gap for companies to be more activated in their purpose, but it's happening." 

We sat down with Cone last week to revisit her findings from February and get a handle on how corporate purpose may change in a post-COVID-19 world. 

A focus on employees will become paramount 

While B2Bs are accountable to their employees, shareholders and communities, their exposure to the court of public opinion is often limited. Most of these businesses — which range from professional service firms like accountants and human resource managers, to insurance companies and manufacturers — are not household names. Generally, they don't have to worry about being dragged on social media, because the average person doesn't even know who they are. 

In this sense, B2Bs are something of a canary in the coal mine when it comes to corporate purpose: The public isn't forcing them to do this — they're doing it because they see a material benefit. 

In Cone's research, 82 percent of B2B professionals said they embrace purpose because they feel purpose-driven companies achieve greater success, while around 75 percent cited benefits for recruiting and motivating employees.  

"Employees were not the number-one focus. They were important, but they weren’t the most important," Cone explained. "Now, when you're talking about stakeholder-based capitalism, employees must be number one."

In the research, Cone and her cohorts identified a particular group of employees, who they dubbed "believers," with the potential to dramatically accelerate a company's purpose work. Making up around 21 percent of employees at the average B2B, these team members agree with the statement: “I believe that if my company focused on our purpose, we would be more successful.”

"What the believers will do, they will promote, they will recruit. In times of crisis, they're going to stand up for you," Cone explained. 

But whether or not these employees remain believers will depend on how companies react when it matters most. "I just hope that in understanding purpose, with whether it's through our research or others, that these companies recognize they're closer to their employees than ever before. They cannot take them for granted," Cone told us. "And I still think a vast majority of organizations did." 

"The [organizations] that are smart, the ones that want to see a light at the end of this tunnel, they will not only currently focus on the health and safety of their employees, but coming out of it, they will also reassess what it means to bring their values and purpose to life." 

As companies get creative in response to the crisis, more will close the purpose gap

On that last point, Cone said the leaders during this trying time are those who observe what she calls "smart generosity." In other words: They're not just earmarking funds for charitable donations, although that's certainly commendable, but they're going further to explore how their teams, products, and core competencies can address key needs as the communities they serve struggle to respond to the crisis. 

"The companies that are leading are not just being generous, but they’re being smart about it. They’re applying a strategic lens to the best way they can utilize their employees and operations," she told us. "Companies are looking at: What do we do that’s really good in terms of our capabilities?"

Personal care and alcohol companies retooling their manufacturing plants to produce hand sanitizer, education technology firms unlocking solutions for students suddenly learning from home, and computing giants volunteering their 3D printers to create ventilator components are clear examples of smart generosity — and activated purpose — unfolding in real time. 

"Activated purpose is not just about society," Cone explained. "It's internal and external. Culture, operations, innovation and engagement with society: that's a fully activated purpose. And when you have it, it is easier to make the decisions of how you're going to act in a crisis."

We're headed for a "dramatic reset" 

We've said it before, and I'll say it again. Make no mistake: People are paying close attention to how companies respond during this crisis — and how they treat their stakeholders when it matters most. 

Through the course of our reporting in recent weeks, we’ve seen the public respond almost immediately with swift and heavy backlash against companies perceived to be callous or insensitive to their employees, customers and communities during this time, and with praise and thanks for the brands showing authentic leadership. Even B2Bs are being thrust into the spotlight like never before — and this is unlikely to be a temporary change. 

As Mike Barry, the architect of Marks and Spencer’s Plan A sustainability strategy and a board trustee at A Blueprint for Better Business, observed on Ethical Corporation last week: "Post-COVID-19, we will not see a blind eye turned as it was to the banks in 2008-2012 as they crept back to the old ways on the back of taxpayer support. The companies that prosper in the next decade will be the ones that have taken the management-speak of 'purpose' and turned it into reality."

Cone agrees. "It’s a question similar to: What did you do during 9/11? And that question will be asked here," she predicted. "There’s no question our society will change. This is not a bump in the road. It is a time for reflection, a time for calm, a time for going back to our roots, and I think there will be a dramatic reset." 

Image credit: Joshua Reddekopp/Unsplash