It’s no longer enough to provide a product or service and generate enough of a margin to call it a living.
A new report has found that 1.2 million businesses in the UK (22 per cent) have added social or environmental objectives as their main motivation.
This figure increases to 66 per cent (3.6 million of all businesses) for businesses that are either motivated by the desire to produce a positive outcome for stakeholders or to make a difference either socially, environmentally, or in terms of job creation.
Margaret Willis, CEO of Unity Bank, which produced the report, said: “I am delighted to see so many businesses stating that they are focused on producing positive outcomes for stakeholders or making a difference. As an ethical bank that works exclusively with organisations and businesses seeking a positive social impact, we look forward to supporting such organisations to help create a better society.”
The report establishes the characteristics of organisations with a social conscience. It analyses the differences between mainstream and socially conscious businesses, as well as identifying the size of the market for those with a social conscience, and providing evidence of the challenges they face.
The report says: “There has never been a more important time to address the role of alternative business models in the UK. Slow real wage growth relative to inflation has placed more individual households into the “just about managing” category.”
“This should be the moment for socially conscious businesses; companies that are motivated by social or environmental goals rather than solely by the pursuit of profit. They may make profit, after all some form of surplus is critical to invest in a better future, but they do not have profit as their only motivation and will often reinvest that profit in their employees or in the social objectives that they set out to achieve. Because of this, they potentially offer a stakeholder-based way of operating that doesn’t necessarily make less money, but will make that money in pursuit of social and environmental objectives, reinvesting accordingly.”