In an article, published by the Harvard Business Review, Rosabeth Moss Kanter, author of SuperCorp: How Vanguard Companies Create Innovation, Profits, Growth, and Social Good, discusses the modern day relationship between business and society and how great companies are more than money-generating machines, they combine financial and social logic to build enduring success.
Kanter has identified six principals that great companies employ a common purpose, a long-term view, emotional engagement, partnering with the public, innovation, and self-organization.
1. A Common Purpose
A purpose greater than profit making is at the core of a great company’s identity. It guides them in everything they do. Great companies invest in creating a culture based on a common purpose, which in turn gives coherence to the organization.
2. A Long-Term Focus
Thinking of companies as social institutions provides a long-term perspective of their place in the world and justifies any short-term financial sacrifices required to achieve the corporate purpose and to endure over time. Keeping a company alive requires resources, so financial logic demands attention to the numbers. However, great companies are willing to sacrifice short-term financial opportunities if they are incompatible with institutional values.
3. Emotional Engagement
The transmission of institutional values can evoke positive emotions, stimulate motivation, and propel self-regulation or peer regulation. Great companies spend considerable resources breathing new life into long-standing value statements, nurturing a dialogue that keeps social purpose at the forefront of everyone’s mind and ensures that employees use the organizational values as a guide for business decisions.
4. Partnering with the Public
The need to cross borders and sectors to tap new business opportunities must be accompanied by concern for public issues beyond the boundaries of the company, requiring the formation of public-private partnerships in which executives consider societal interests along with their business interests.
Articulating a purpose broader than making money can guide strategies and actions, open new sources for innovation, and help people express corporate and personal values in their everyday work.
Great companies assume they can trust people and can rely on relationships, not just rules and structures. They are more likely to treat employees as self-determining professionals who coordinate and integrate activates by self-organizing and generating new ideas. Self-organizing communities can be a potent force for change, propelling companies in directions they might not have taken otherwise.
Great companies adhere to principals that zag away from traditional business behaviors that only seek to generate private wealth.
This new wave of conscious capitalism, which values public good, is a positive change.
Rather than disconnecting business from society and posing conflicts between them, great companies believe that business is an intrinsic part of society, and like family, government, and religion, has been one of its pillars for centuries.
Great companies identify something larger than transactions to provide purpose and meaning.
They have values and priorities that reach beyond a responsibility to stockholders and place importance on society as an equally important stakeholder.