Baked in Philanthropy or Positive Social Impact
Curious if anyone here is aware of companies that are building in elements of social good into their business models?
Things similar to One Percent for the Planet an international organization whose members contribute at least one percent of their annual revenue to environmental causes to protect the environment.
Personally I think building this type of thing into business models can have a greater effect than just stand alone nonprofits
Yeah, I've seen it all over. It's deceptively hard to do though. That's because, serving your customers, employees, and shareholders is hard enough. To add an extra stakeholder to serve beyond this; is going to pull from those others groups, whether it's attention, or resources. I'm not saying it's impossible or not worth trying, just that it's very, very challenging to do so and outside the standard business practice norms.
ESG is typically done as a marketing ploy, "hey we are socially conscious, now buy from us", which sometimes works, but if ESG is just done to increase sales, I find that very problematic. Very few companies do ESG without shouting from the rooftops about how "socially conscious" they are, which again, speaks to it being somewhat of a marketing sales ploy and not a core, deeply held, internal value.
Very dialed in here, and I think you have outlined some of the challenges. I do think co-ops, B-Corps & ESOP's as business models, REI, Tillamook Creamery, Land-O-Lakes, ACE Hardware, Bob's Red Mill, come closer to building on businesses that provide additional positive elements to local communities and the world. Also agree w/ you that being done from a pure marketing ploy (Tom's Shoes) can feel much more like a smarmy marketing ploy.
Good point. You can create positive ESG serving the 3 traditional business stakeholders - while having high standards with respect to environmental stewardship, and perhaps if so inclined doing corporate philanthropy. (But being mindful that corporate giving takes away from wages of employees who might otherwise give to charity.) If you're running a health food company, your goal (and target market) is making healthy foods - that's almost like inbuilt ESG with no downside (tradeoff between stakeholders).. So there are ways to do ESG that perhaps make more sense. But be very, very skeptical.