Ann Francke: Should we all be more like social enterprises?

11 February 2016 -

Big business has always had its critics, but many companies are now looking at reinventing themselves as a force for good with positive social values

CMI chief executive Ann Francke

Many people instinctively disapprove of ‘big business’. Watch Question Time and you’ll hear kneejerk applause as soon as politicians put the boot into corporations.

The criticism can be justified. VW’s reputation has been shredded by the emissions scandal. But it’s always been difficult for companies to reorient themselves around positive social impacts and behaviours.

Only recently, with the introduction of benefit corporation status, have directors in the US actually been able to give equal consideration to non-financial objectives.

However, the demands of customers are forcing companies to make their social objectives explicit. For young people, a positive social impact is often their number-one ask when it comes to choosing a product or service.

The tools to embed positive impact are falling into place. Sir Ronald Cohen explains in the winter edition of Professional Manager that a company’s performance against its stated social objectives can now be accurately measured.

Private-sector companies don’t have any wiggle room any more; they have to operate to positive social standards, otherwise they’ll lose their reputation, top talent and investor support.

There is real intellectual impetus behind new types of corporate behaviour. Look at recent shortlists for CMI’s Management Book of the Year, and you’ll find many exhortations to ethical, socially responsible, purpose-driven management.

John Spedan Lewis, founder of the John Lewis Partnership, famously described his retail company as an ‘experiment’ in employee ownership and called for others to set up their own. I think we’ll see many private-sector companies recasting themselves around a set of new, positive social values.

We intend to celebrate this in 2016.

Previously, we have recognised Paul Polman for his work putting sustainability centre-stage at Unilever. This year, we will be honouring business leaders who do things a bit differently when we present our Gold Medal and Lifetime Achievement awards.

Jimmy Wales’s vision for Wikipedia is “a world in which every single person on the planet is given free access to the sum of all human knowledge”. This is truly noble stuff.

And Sir Ronald Cohen envisages a near-term future in which “people will sell the shares of companies if they’re disappointed with the impact they’re achieving”.

These are the kinds of leaders the world needs, and I can’t wait to present them with their awards at the President’s Dinner in March.