Were you unable to attend Transform 2022? Check out all of the summit sessions in our on-demand library now! Watch here.
Whether you are running an enterprise company or a consumer brand, social impact is now a critical component of every business strategy. While revenue will forever be a leading priority, this shift in perspective indicates the need for leaders to invest in strategies that marry profit and impact to ensure that consumers, clients and partners, and employees clearly understand the company’s mission and vision.
There are ample benefits in building a for-profit business model focused on social impact. Companies are more profitable with corporate social responsibility (CSR) efforts. Research from the Harvard Business Review shows companies with CSR programs increase sales revenue by up to 20% and new talent with innovative ideas is more likely to apply to companies with established CSR standards.
Ninety-four percent of Gen-Z now think companies should address pressing social and environmental issues, and if a company doesn’t, the likelihood of attracting strong talent significantly decreases. Similarly, 77% of consumers are more likely to support companies committed to making the world a better place through their CSR efforts and social impact focus.
So how do you strike a balance between influencing change on a social or environmental level and ensuring profitability? By centering your business model around a clear mission statement supported by data and education.
Before leaders can create any significant social impact, they must first fully understand the company’s mission and desired impact. Establishing a clear mission begins internally with key stakeholders identifying their core values and developing a single mission statement. Then the company must build a strong foundation and internal processes that move its mission forward, creating alignment across the entire company.
Data and insights are integral to ignite social impact
The key to balancing corporate social impact and profitability is prioritizing data gathering and analysis. Data, measurement, monitoring and reporting are critical to any successful business and its leadership team’s ability to affect change.
Data-powered insights are at the core of balancing internal positive change and profitability as a company. This idea of using data to effect change is the most comprehensive way to understand your company internally and externally.
Figuring out how to measure social and financial performance to determine success and generate data helps establish that equilibrium. While monitoring for and reporting on data and findings are where real change begins to happen. For example, by tracking and reporting on the performance of their CSR initiatives, business leaders can identify key areas to invest in. They can also use the subsequent data to determine how these activities can be leveraged to generate profit and unlock new streams of revenue.
Through data collection and analysis, organizations can truly understand and measure the effectiveness of solutions. Companies should establish what data drives results that align with their mission so leadership knows what to prioritize and measure.
While data collection and analysis are the backbones of an impact-driven business, leaders must also implement streamlined processes for data monitoring and reporting. Why? Because (1) you cannot fix what cannot be measured, and (2) you cannot create profitable business models to fuel social change without first understanding their impact.
Clear reporting on data and insights enables your entire organization to feel more aligned with the overall company goals and helps the leadership team make better business decisions. It is also critical to solving complex problems, connecting a company’s mission and purpose with its day-to-day processes, understanding customer behavior better and even increasing employee engagement.
Education and outreach from data findings play a pivotal role
Leveraging data and storytelling is critical to shaping a business model that is impactful and profitable. Social change only occurs when a company comes across as a unified front, willing to construct a full understanding of the corporate mission goals and plans for revenue. Creating social change and profit is difficult but the key is balance. The data and insights that companies gather play a pivotal role in driving social impact because data can be used to tell meaningful stories that influence and inspire change.
Education through strategic storytelling drives a company’s bottom line by creating emotion in and establishing strong connections with its core stakeholders. For example, compelling data-driven stories that highlight a brand’s values, mission and CSR investments are a lucrative tool to secure strategic partnerships (both profitable and socially impactful) or attract new customers and employees.
This also presents a unique opportunity for brands to be transparent about the issues they are facing and the solutions they’ve created to address them. This can include challenges related to business strategy and finances or, more broadly, issues such as minimizing a company’s environmental footprint.
Finally, clearly communicating your brand’s purpose and impact can also be used to establish tight-knit communities that center around shared experiences and garner support for the social and environmental issues that matter to your brand.
It’s up to leaders at companies of all shapes and sizes to establish a foundation for a company’s impact-focused mission. From there, it’s essential that the full team has an understanding of the company’s mission and the steps being taken to make an impact.
CSR efforts are shown to be profitable and fuel change, but only if the company business model can support itself internally first. Companies should prioritize data collection, analysis and education to truly understand what is happening and measure the effectiveness of solutions. Without effective solutions, impact-driven work is only an idea and not a reality.
Lisa Marrocchino is CEO of Proteus Ocean Group.
Welcome to the VentureBeat community!
DataDecisionMakers is where experts, including the technical people doing data work, can share data-related insights and innovation.
If you want to read about cutting-edge ideas and up-to-date information, best practices, and the future of data and data tech, join us at DataDecisionMakers.
You might even consider contributing an article of your own!