Guardian Masterclass: How to run a purpose-driven business

Sally Hill | Wildwon | Oct 2016

purpose.do sallyrhill
10:00 am  
Introductions
10:15 - 11:15 am  
The purpose-driven  
business landscape
Break
11:35 - 1:00 pm 
What can purpose do?
Lunch
2:00 - 3:00 pm  
Your Business:  
Purpose applied  
and purpose frameworks
Break
3:20 - 4:20pm  
Meet the masters:  
Guest speaker
4:20 - 5:00pm  
Takeaways:  
Tools and Resources
The day

Introduction

Group intros: 
 
+ name 
+ role & organisation 
+ why you were interested coming along 
+ what you’re hoping to get out of the day

Purpose in a nutshell
What is a purpose-driven business?
 
Organisations have often been divided into two major types: non-profits and for-profits. 
Purpose-driven business is something in between.
Purpose is an aspirational reason for being that is grounded in humanity and which inspires
a call to action.
All companies have a purpose - however we define purpose-driven business as companies
that are oriented around something other than money and serve a higher, positive purpose. 
 
Today we’re talking primarily about organisational purpose rather than personal.

Long-term/outwardly focused
Aspirational and belief-driven
Humanistic
Broader than the company’s 
activities, products or services
Resonates with the company’s 
DNA and values
Captivates customers, 
employees, partners and 
the market
Timeless (or lasts at least 100 years)
‘Why a company exists in the ﬁrst place’  
(David Packard)
Purpose is Purpose is not
A vision
A mission, values, credo, tagline etc.
Philanthropy
Solely focused on the 
organisation internally
Branding, corporate sustainability, or
public relations
Short term
Business goals or strategy
About being trendy
‘Tacked on’ via marketing or
community activities

Write down your  
purpose statement (v1)

The purpose-driven business
landscape

The business world has a spotlight ﬁrmly on purpose

The business world has a spotlight ﬁrmly on purpose
Simon Sinek  
“Start with why”

Edelman GoodPurpose study 
Havas Media “Meaningful Brands” Global Report 
Deloitte Core Beliefs & Culture survey 
Echo Global CSR Study
Consumer expectations have shifted
• 87% of global consumers believe that business needs to place at least equal
weight on society’s interests as on business’ interests
• 80% of global consumers think it’s important for companies to make them aware of
their effort to address social issues
• Only 6% believe the singular purpose of business is to make money for
shareholders
• 76% think it’s ok for brands to support a mission and make money at the same time
• 91% of global consumers would switch brands if a different brand of similar
price and quality had a strong mission

Edelman GoodPurpose study 
Havas Media “Meaningful Brands” Global Report 
Deloitte Core Beliefs & Culture survey 
Echo Global CSR Study
Consumer expectations have shifted
• 54% of consumers don’t trust mainstream brands
• 47% of global consumers buy brands that support a good cause at
least monthly
• 53% would not invest in a company that does not actively support a
good cause
• 90% would boycott if they learned of a company’s irresponsible
business practises, and more than 55% have done so in the past
12 months

Employee expectations have shifted
47% percent of tertiary students are Purpose-Oriented and
they are raising the bar for higher education and the
workplace. Employers and colleges that are able to adjust
to meet these needs will likely thrive over the next few
decades 
 
(Imperative 2016 Purpose in Higher Education Report)
The movement is already happening. People are
increasingly looking for jobs that give them personal
fulﬁllment; and companies are seeing that purpose-
oriented employees are more productive and successful.
(Global Purpose Index 2016)

The data is showing that purpose-driven companies outperform others
“A purpose mobilizes people in a way that pursuing proﬁts
alone never will.”  
- FastCompany 
 
“Over a decade-long period, purposeful, value-driven
companies outperform their counterparts in stock price
by a factor of 12.”  
- John Kotter and James Heskett, Corporate Culture and
Performance 
 
“Those companies able to harness the power of purpose to
drive performance and proﬁtability enjoy a distinct
competitive advantage”  
- Valerie Keller, Global Lead, EY Beacon Institute 
 
The meaningful brands index outperforms the stock
market by 120% 
- Edelman GoodPurpose Study

In ‘Firms of Endearment’ - the authors proﬁled 28 FOE and found that they
not only outperformed the S&P 500 by huge margins, they also
outperformed the companies highlighted in the bestselling book
Good to Great, which identiﬁed 11 companies that delivered superior
returns to investors over extended periods. The performance metrics below
are nothing short of astounding.

EY Beacon Institute
 
“Those companies able to
harness the power of purpose
to drive performance and
proﬁtability enjoy a distinct
competitive advantage”  
 
- Valerie Keller, Global Lead, EY
Beacon Institute

CSR
Corporate sustainability
Shared value
Integrated reporting Purpose 
as a change enabler,
guiding force &
competitive
advantage
Philanthropy
Regenerative design
Circular economy
Corporate context

EY Beacon Institute

Emphasis on the ‘driven’ or ‘led’ in purpose-driven or purpose-led
By acting on their purpose, companies can create
more value for their shareholders and society over
the long term than by pursuing purely financial
goals or a narrowly defined self-interest.
- EY Beacon Institute
The Purpose Paradox
“The best way to maximize profits, is not to make
profits a primary goal.”  
- John Mackey, co-founder and CEO of Whole Foods

Terms, frameworks and who’s who

The Purpose Economy
Resource Framework Who?
Brands
- purpose is what’s next
after information
economy
- purpose as the
primary driver of
economic output
- purpose as the
common denominator
in other mega-trends
Aaron Hurst

Higher Purpose: Recognising that every business has a purpose
that includes, but is more than, making money. By focusing on its
Higher Purpose, a business inspires, engages and energizes its
stakeholders.
Stakeholder Orientation: Recognising that the interdependent
nature of life and the human foundations of business, a business
needs to create value with and for its various stakeholders
(customers, employees, vendors, investors, communities, etc.).
Like the life forms in an ecosystem, healthy stakeholders lead to a
healthy business system.
Conscious Leadership: Human social organizations are created
and guided by leaders – people who see a path and inspire others
to travel along the path. Conscious Leaders understand and
embrace the Higher Purpose of business and focus on creating
value for and harmonizing the interests of the business
stakeholders. They recognize the integral role of culture and
purposefully cultivate Conscious Culture.
Conscious Culture: This is the ethos – the values, principles,
practices – underlying the social fabric of a business, which
permeates the atmosphere of a business and connects the
stakeholders to each other and to the purpose, people and
processes that comprise the company.
• Business is good because it creates
value, it is ethical because it is based
on voluntary exchange, it is noble
because it can elevate our existence
and it is heroic because it lifts people
out of poverty and creates prosperity.
• Free enterprise capitalism is the most
powerful system for social cooperation
and human progress ever conceived.
It is one of the most compelling ideas
we humans have ever had. But we
can aspire to even more.
• Conscious Capitalism is a way of
thinking about capitalism and business
that better reﬂects where we are in the
human journey, the state of our world
today, and the innate potential of
business to make a positive impact on
the world.
Conscious Capitalism
Brands

Resources Framework Who?
John Mackey 
Raj Siodia 
Michael Bradley

Shared Value
Framework
- Shared value is a
management strategy
focused on companies
creating measurable
business value by
identifying and
addressing social
problems that intersect
with their business.

The Purpose Economy
CSR > CSV BrandsWho?

Circular Economy
About FrameworkWho? Brands
A circular economy is
one that is restorative
and regenerative by
design, and which aims
to keep products,
components and
materials at their highest
utility and value at all
times, distinguishing
between technical and
biological cycles.

Cradle to Cradle
Resource Framework Who?
Brands
- created by industrial
designer William
McDonough
- also called
‘regenerative design’
- views materials as
nutrients circulating in
safe, natural
metabolisms
William McDonough

Natural Capitalism
Resources
• Most businesses still
operate according to a
world view that hasn’t
changed since the
industrial revolution.
• Then, natural
resources were
abundant and labor
was the limiting factor
of production. Now,
there’s a surplus of
people while natural
capital (natural
resources and
ecological systems
that support life) are in
decline and relatively
expensive.
• Business must adjust
to these realities and
account for diverse
forms of capital/value.

Natural Capitalism
Framework Who?
Related ideas
Six Capitals
Integrated reporting
True cost accounting
Investing in natural capital
Biomimicry
Radical resource efﬁciency
Service & ﬂow economy
Cradle to Cradle

Purpose-driven entrepreneurship

B Corp (Benefit Corporations)
Resources Who?
• B Corp is to business
what Fair Trade
certification is to coffee
• It’s about ‘redefining
success in business’
• being best for the world,
not just best in the
world
• Stringent assessment
tool and standards
• Alicia Darvall (ED)

Brands
1104 B Corporations 60+ Industries 30+ Countries 1 Unifying Goal1600

Social Beneﬁt Company
About Legally Who?
Prashan Paramanathan, CEO
We wanted our new structure to allow us to
raise equity while embedding our purpose into
our DNA. Practically what 'embedding our
purpose' means to us is:
- that everyone (i.e. shareholders and
directors) is clear on what the purpose of the
organisation is; and
- that they are required and permitted to act to
further the purpose; and
- that shareholders (in particular founders)
have a way of ensuring that the purpose is
followed even with ownership changes
Current Australian equivalent of a
(US) Public Beneﬁt Company
Three tenets included in legal
structure of organisation:
- statement of purpose
- statement of director’s duties
- mission lock (changing the
purpose or Directors Duties
requires a 100% shareholder
vote
“a new legal
structure for
Australian social
enterprises”

Social enterprise developmentSocial enterprises are businesses that trade to intentionally tackle social
problems, improve communities, provide employment and training, or help
the environment.
In Australia there’s no legal structure / entity type for social enterprise but
they’re typically defined as:
1. driven by a public or community cause - social, environmental or
economic
2. derive most of their income from trade, not donations or grants
3. use the majority of their profits (at least 50%) to work towards their social
mission
Typically, they start with the cause and then build a business model around it
- meaning one of the key challenges is social enterprise development and
sustainability.
Social procurement is becoming recognised as a key way for large
organisations to have a positive impact through their purchasing power
• The ‘Finding Australia’s Social
Enterprises Report (FASES)
2016, from Swinburne
University’s Centre for Social
Impact (CSI) in partnership with
Social Traders, surveyed 370
social enterprise practitioners.
• Australia’s social enterprise
sector is thriving, according to
the recently released Currently,
• There are at least 20,000
Australian social enterprises in
operation, and many of these
are between two and five years
old.
Social Enterprise
Who?
Social procurement
ResourceAbout

Not-for-proﬁt + mission-aligned trading activity
eg. Oxfam (stores)
Inspiring Adventures
ADARA Group - Audette Exel (0:22 - 12:00)
Hybrid Models

Community or welfare  
organisation (charity)
NFP with mission-
aligned trading
activity
Social enterprise Social / ethical  
business
Mainstream  
commercial business
PRIMARY PURPOSE PRIVATE PROFITCOMMUNITY BENEFIT
via Social TradersSpectrum

NFP with mission-
aligned trading
activity
Social enterprise
Social / ethical  
business
Mainstream  
commercial business
Mainstream business  
w. shared value 
or integrated reporting
Purpose-driven  
mainstream business
PRIMARY PURPOSE PRIVATE PROFITCOMMUNITY BENEFIT
Spectrum: reconsidered

PRIVATE -> MUTUAL PROFIT
COMMUNITY BENEFIT
B Corp
Circular Economy
Natural Capital
Shared value
Purpose-driven  
entrepreneurship
Purpose economy
Spectrum: reconsidered
NFP with mission-
aligned trading
activity
Social enterprise
Mainstream  
commercial business
Mainstream business  
w. shared value 
or integrated reporting
Social / ethical  
business
Purpose-driven  
mainstream business

Pairs to discuss: 
 
+ where does your organisation sit on the spectrum? 
+ why? 
+ does proﬁt or purpose ‘drive’ for your organisation?

Purpose as strategy
aka ‘what can purpose do?’

Purpose
Leadership  
Behaviour
Values-based 
Culture
Trusting & engaged 
employees
Meaningful 
experience for  
customers
Purpose as strategy
• Purpose is activated
internally by leaders
whose daily behaviour and
decisions reﬂect the
company’s purpose and
values.
• This creates a values-
based culture, along with
positive interactions and
experiences
• Builds employee trust and
engagement
• This drives positive
interactions and
experiences with
customers, leading to
engaged, motivated and
satisﬁed customers who
trust and recommend you.

Brand
Who Gives a Crap, Patagonia 
(Driving the character of a brand and loyalty - brand equity via story)
 
Innovation
Nike, Interface 
(driving force and focus for innovation, R&D, ﬂows to brand) 
Team, Community & Culture
ETSY, Blackbaud 
(community and team can rally around purpose, decision-making clear) 
Customer Experience
FrankGreen, Sendle 
(superior customer experience by solving a problem well) 
Parts of a business that purpose can
infuse and drive forward
Giving companies a competitive
advantage
Proﬁtability and performance
Brands who’ve actually done this and 
how it has manifested
What purpose can do

Purpose statement:
Build the best
product; cause no
unnecessary
harm; use
business to
inspire; and
implement
solutions to the
environmental
crisis
Leadership 
 
Culture 
 
Meaningful
experience  
for customers
CUSTOMER EXPERIENCE
PURPOSE PARADOX - ‘don’t buy this jacket’
INNOVATION

Brand promise
Toilet paper that
builds toilets 
 
‘Consumer
philanthropy’ - or
- we can change
the world using
beer and toilet
paper. 
 
 
Brand 
 
Customer
experience 
 
Culture 
BRAND
CULTURE
INNOVATION

Purpose statement:
To be the first
company that, by
its deeds, shows the
entire industrial
world what
sustainability is in
all its dimensions:
people, process,
product, place and
profits - by 2020 -
and in doing so we
will become
restorative through
the power of
influence.
CLOSED LOOP
NET-WORKS
BIOMIMICRY

CEO Mike Parker:
“Can we double
our business while
halving our
environmental
impact?” 
 
“If you have a
body you are an
athlete”  
 
“Bring inspiration
to every athlete in
the world” 
 
Clear case of
purpose driving
performance and
proﬁtability
FLYKNIT
PURPOSE PARADOX - ‘market cap’
FLYEASE

Purpose statement:
Build the best
product; cause no
unnecessary
harm; use
business to
inspire; and
implement
solutions to the
environmental
crisis
Smart cups 
 
+ Cafe Pay 
 
Superior experience  
for customers
SMART CUPS
SOLVING A PROBLEM
INNOVATION

Purpose statement:
Our mission is to
reimagine
commerce in ways
that build a more
fulfilling and
lasting world.
We are a mindful,
transparent, and
humane business.
We plan and build
for the long term.
We value
craftsmanship in all
we make.
AN ‘ETSY’ ECONOMY
INNOVATIONCOMMUNITY

Sendle delivers
parcels door-to-
door across
Australia at flat
rates cheaper than
post.Meaningful
experience  
for customers 
 
Designed to solve
the problem of latent
capacity in delivery
vehicles - and better
post.  
 
Creates radical
efﬁciency and saves
Co2 emissions

Commodity
Products
Services
Experiences
PurposePurpose is at the top of the chain 
of value creation (video 4:30 -9:36)
Chain of value creation - James Moody (Sendle)

Discussion - what are your favourite examples?
What is purpose ‘doing’ for this company? 
 
- brand 
- innovation 
- team, culture, community 
- performance and proﬁtability

Back to purpose statements.
But ﬁrst, a few things to think about

collaboration & partnerships
circular economy & closed loop
deep community
cathedral thinking
different by design
meaningful work
business model innovation
solving a problem
21st century economics
Key trends and ideas

Purpose vs mission
In a 1960 speech to Hewlett-Packard’s training group,
company co-founder David Packard said,
I want to discuss why a company exists in the first place. In
other words, why are we here? I think many people assume,
wrongly, that a company exists simply to make money. While
this is an important result of a company’s existence, we have
to go deeper and find the real reasons for our being. . . .
Purpose (which should last at least 100 years) should not be
confused with specific goals or business strategies (which
should change many times in 100 years). Whereas you might
achieve a goal or complete a strategy, you cannot fulfill a
purpose; it’s like a guiding star on the horizon—forever
pursued but never reached. Yet although purpose itself does
not change, it does inspire change. The very fact that
purpose can never be fully realized means that an
organization can never stop stimulating change and progress.

• What is your purpose?
• What problem does it solve?
• What special superpower does it employ? (personal or organisational)
• Have we checked that it’s timeless and that it’s not a vision, values or mission
statement?
• How will it let purpose drive?
• What benefits would flow from it (brand, culture, team, innovation etc) ?
Purpose definition

What is your purpose statement - V2

Lunch Break

Your business:  
Purpose applied

‘Doing’ purpose - activation across an enterprise

Purpose
Leadership  
Behaviour
Values-based 
Culture
Trusting & engaged 
employees
Meaningful 
experience for  
customers
• Purpose is activated
internally by leaders
whose daily behaviour and
decisions reﬂect the
company’s purpose and
values.
• This creates a values-
based culture, along with
positive interactions and
experiences
• Builds employee trust and
engagement
• This drives positive
interactions and
experiences with
customers, leading to
engaged, motivated and
satisﬁed customers who
trust and recommend you.
Purpose applied:  
Flows outwards from core
Innovation
Motivation
Story
Brand
Messages
Service

‘Meet a Master’
Guest speaker - Simon Grifﬁths, Who Gives a Crap

– Simon Grifﬁths, Who Gives a Crap
“We can change the
world using beer and
toilet paper.”

More tools & resources

Commodity
Products
Services
Experiences
PurposePurpose is at the top of the chain 
of value creation (video)
Chain of value creation - James Moody (Sendle)

Business Model CanvasBusiness
modelling

Business modelling with purpose at the apex

B Corp impact assessment
Patagonia - ‘The Responsible Company’ checklists
GRI - sustainability reporting standards and index
UN Global Compact - voluntary, CEO commitments
Social Traders - re. improving social procurement
Further resources: tools for assessment & tracking

+ Audette Exel (ADARA Group)
+ Helen Souness (ETSY)
+ James Moody (Sendle)
+ Simon Grifﬁths (Who Gives a Crap)
+ Ben Burge (Powershop)
+ Clinton Squires (Interface)
+ Kim and Jason Graham-Nye (gDiapers)
Further resources: Purpose (conference) on Vimeo

Spark Strategy - moving from NFP to sustainable
enterprise models
Hatched - infusing purpose through your whole company
and strategy
EY - purpose-led transformation
Centre for Sustainability Leadership
School for Social Entrepreneurs
Further resources: companies and agencies specialising in purpose

Startup Podcast
Foundr Podcast
People of Purpose
The Good Work Revolution
mezzanine.co
Further resources: podcasts

B the Change Media
Guardian Sustainable Business
3BL
Triple Pundit
grist
Further reading: blogs & online

Guardian Masterclass: How to run a purpose-driven business

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