How Social Mission Can Drive Business Performance, Profit, and Impact – A Conversation with Andy Last, Author of Business on a Mission.

How Social Mission Can Drive Business Performance, Profit, and Impact – A Conversation with Andy Last, Author of Business on a Mission.

Human beings are social animals with selfish genes, and we flourish when the two work in tandem. Likewise for businesses – successful, sustainable growth is most easily achieved when a business’s competitive instincts are harnessed to the needs of the society in which it operates. Today, companies must find their social purpose or risk losing out to competitors. It’s not enough to talk about ‘building back better’; businesses need to develop strategies that they can action now or risk losing market share and losing the best talent. Opportunities await those who understand that upcoming generations will make different choices from previous ones. Driven in part by the transparency of the digital age, Millennials, and even more so Generation Z, respect figures such as Greta Thunberg and David Attenborough; they are motivated to protest in solidarity with Black Lives Matter and MeToo movements; and they want businesses to develop a more sustainable relationship with society and offer them the opportunity for purpose and meaningful work.

Andy Last has spent 20 years advising some of the world’s biggest businesses on social issues. In his new book, Business on a Mission, he explores the link between social mission, purpose, sustainability, and performance. Andy shows that purpose and profit are not incompatible, and that understanding, responding to, and actioning the values of a business can drive returns alongside attracting and retaining talent.

In this interview, I speak with Andy Last, author of Business on a Mission, on the importance of social mission for businesses, how to articulate and measure your mission, and how social mission can drive real profits and performance.

Q: How have businesses typically approached social mission?

[Andy Last]: We live in a global world now, so often businesses are dealing with people they’ve never met and cannot see. If you go back to the origins of business, you would start trading in a small town, everyone would know you – and if your products were suboptimal, people would talk to each other and find out! If you were a bad employer, people would find out! Your local bank manager would know you… would understand your business and would be able to make a judgement on whether to lend or not.

If we look at some of the great industrial-era entrepreneurs, many anchored their businesses around place. William Lever (Port Sunlight), Titus Salt (Salt Aire) and John Cadbury (Bourneville). The companies these founders created are still socially aware today and realise that to be successful you have to understand- and act on-your relationship with society. Clearly, these were different times, but businesses eventually suffer if they don’t understand their relationship with society.

Q: When did the link between business and society ‘break’?

[Andy Last]: You had an industrial revolution built off coal, which started in the UK and made its way to the United States where the founding fathers had these puritan beliefs around how society, and business, should be organised. The great American companies from 1850-1950 didn’t have individual superstar CEOs but had boards of equals that operated around shared values. From the 1950s onwards, the financialization of business led to shorter-term CEO tenure, much more shareholder engagement, quarterly returns and business being analysed to within an inch of their lives. The posture changed. Instead of looking at the fundamentals of business and long-term success, you started seeing a focus on short-term returns and CEOs emerging as a dominant force rather than being part of a board of equals. That financialization started to ‘sever’ the relationship between business and society and eventually led to the 2007/2008 crash. I don’t think this is about moving-away from capitalisation, but rather, it’s about moving away from this highly financialized version of capitalism.

[Vikas: How does this manifest in the c-suite of business?]

[Andy Last]: Leaders cannot delegate social mission to ‘somewhere else’ in the business. There’s pressure comping from the digital world, from shareholders, investors, workforce and government. Leaders can no longer afford for social mission to be done on the side; it has to be built into the core model. One of the barriers to building social models into the core is to pretend these models are some kind of doing good initiatives and not core to the business.

Q: How are shareholders now putting pressure on businesses to do better regarding their social missions?

[Andy Last]: The majority of shares are held by pensions funds who, by definition, need to take a long-term view on business. Pension funds are seeing that there are risks inherent in forgetting your relationship with society; reputational risks, product boycotts, regulatory challenge… there are no dark-corners in which supply chains can hide anymore. Issues in supply chain become visible, very quickly. If you’re sourcing trainers from sweatshops, those sweatshops can be filmed on a mobile phone and that can go viral in hours, destroying shareholder value. Coupled with this, you have the emergence of generations who are growing-up with climate change as a very real threat to their futures.

The emergence of instant visibility (meaning you can’t hide bad practices) together with climate change becoming the dominant issue of our day has meant that shareholders now see environmental and social decisions are now inherent in business decision making. This isn’t about shareholders becoming like Greenpeace but realising that return on investment requires you to understand your risks and that requires you to understand, and act on, your relationship with society.

Q: What are the commercial benefits of social mission?

[Andy Last]: If you have the right social mission, it can benefit your business in one of four ways.

  • Identifying the right social mission can make your marketing more effective and can help you engage your audience. We did a lot of work with Domestos for example, helping them to create a social mission around tackling the world sanitation crisis, and helping the two-and-a-half billion people in the world who don’t have access to adequate sanitation. It’s much more interesting to talk about Domestos’ social impact than it is to talk about a new bleach nozzle!
  • Social mission also engages sales. Many commercial tenders now require companies to demonstrate their social commitments – and many large customers (supermarkets and eCommerce platforms) note that having a properly articulated demonstrated social-mission can help in the clamour for visibility.
  • Social mission is also an integral part of your license to operate. Whereas in the past this may have been ensured by hushed conversations with regulators and lobbyists, today it’s driven by public-opinion and the threat of activists and active citizens.
  • Social mission is also a key tool you have in the war for talent. Today’s workforce of course wants to earn money, but they want to feel good about the company they’re working for as part of managing their personal Today’s workers don’t want their own reputation soiled by working for a company that doesn’t have a good reputation. They want to feel their work has meaning, and the companies they work for have a purpose.

Those are the four business drivers we see: more effective marketing, better sales, higher employee engagement and an improved licence to operate.

Q: How do you identify a social mission for your business?

[Andy Last]: Your social mission has to genuinely deliver for society and genuinely deliver for business. If your social mission isn’t rooted in delivering for the business, it simply isn’t going to last.

In the early 2000s, we got involved with Lifebuoy soap. It was one of the early brands that William Lever created a soap to save lives. The nature of society at the time the product was created was such that people in Liverpool’s slums were dying from diseases which could have been prevented with better sanitation. At the time, society was beginning to understand germ-theory and William Lever saw that this product- soap- which typically was bought by richer people, could be cut into smaller packages for poorer people to buy. This helped people protect themselves from diseases (we’re all aware of the power of handwashing now!) which was clearly a social good, but it also helped the sales of soap. When we started working with Lifebuoy in the early 2000s, they were doing great work in Sub-Saharan Africa and South Asia to promote handwashing and hygiene, but ultimately this was about selling more soap- and our job was to make sure their social mission once again became re-attached to their business need.

Q: Can businesses reclaim, or reinvigorate, their social mission?

[Andy Last]: There are certain industries who may find social mission more challenging, yet they cannot ignore it. Let’s think about energy companies. If we’re going to move toward a sustainable future with more renewables, the energy companies have to be a part of that. They can’t afford not to be. The fact that many key energy companies were excluded from COP26 tells you the perilous position they are in. Unless they make more active social moves, it is conceivable to see investor attention moving away, and it’s also conceivable to see they will not be able to attract and retain the talent they need. Energy companies therefore need to look deeply at social mission and address issues in a meaningful way.

There are of course exceptions, and certain industries such as tobacco, would be hard-pressed to find meaningful, genuine, social mission!

Q: What is the role of partnerships in social mission?

[Andy Last]: If a business wants to have a genuine social mission, it needs expertise to deliver that social good. Very few businesses have that expertise in-house. Equally, NGOs cannot achieve their goals without the scale, expertise and reach those businesses have.

Key to effective partnership is to make sure that the CFO doesn’t see social mission as some kind of tax. It has to be fundamental to the business. This also means that businesses have to be open with NGOs and say, ‘yes, we’re doing this because we believe in your cause, but we also believe it’s good for our business…’ you can’t be shy about saying that. Businesses are often coy and embarrassed about saying this, but it’s important.

Q: What do you see as being the future of the relationship between business and society?

[Andy Last]: Capitalism isn’t perfect – but we need to turn it toward solving the issues faced by our species and our planet. Capitalism is a great vehicle to generate ideas and change and we’re seeing a greater willingness around the world by governments and NGOs to engage with business.The next generation of consumers will- of course- buy on convenience and price, but all things being equal, businesses are rewarded for doing the right thing. This extends to recruitment and retention – employees want to earn good money, of course, but also see there being no disconnect between doing the right thing and making money. There’s nothing wrong with doing the right thing and making money in the process!

Thought Economics

About the Author

Vikas Shah MBE DL is an entrepreneur, investor & philanthropist. He is CEO of Swiscot Group alongside being a venture-investor in a number of businesses internationally. He is a Non-Executive Board Member of the UK Government’s Department for Business, Energy & Industrial Strategy and a Non-Executive Director of the Solicitors Regulation Authority. Vikas was awarded an MBE for Services to Business and the Economy in Her Majesty the Queen’s 2018 New Year’s Honours List and in 2021 became a Deputy Lieutenant of the Greater Manchester Lieutenancy. He is an Honorary Professor of Business at The Alliance Business School, University of Manchester and Visiting Professors at the MIT Sloan Lisbon MBA.