What company doesn’t want more engaged, more innovative employees? Practicing conscious capitalism can give them to you.
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In an age of B corporations and the triple-bottom line approach to running a company, there’s a lot of focus on what conscious capitalism can do for people, the planet and profits. Conscious corporations create more sustainable operations, socially responsible supply chains and stronger brand images. In a study lasting a decade, brands that placed a focus on conscious capitalism enjoyed returns 10 times higher than the S&P 500.
Most often, conscious capitalism is lauded as a potential differentiator that helps businesses stand out in a crowded marketplace. And there’s solid evidence that an increasing number of consumers prefer social good. A 2015 survey from Nielsen found that 66 percent of consumers would pay more if a business supported a social or environmental cause, representing a 16 percent jump from 2013.
Well, guess what? Those consumers who are interested in supporting conscious business practices are probably employed somewhere. Chances are good that they’re part of your workforce.
Creating conscious employees
When your business gives back to important causes, whether it’s by donating meals to hungry kids or giving job opportunities to the homeless, these acts of kindness create something far more meaningful than a bigger profit margin. They create friendships, deepen bonds of trust and earn your business respect.
According to Drew Kossoff, CEO of Rainmaker Ad Ventures, one of the country’s fastest-growing digital media buying agencies, “These types of returns, more than money, often provide that ‘missing link’ to greater happiness, success and fulfillment at work — which is ultimately what we all really want.”
When socially conscious employees see that a company is driven by more than money, it’s easier for them to commit to the company’s mission. They’ll also become strong brand advocates, as they’ll want to share with family, friends and even strangers what their company is doing to make a difference in the world.
Wondering about the impact conscious capitalism could have in your business? Consider the following workforce benefits of conscious capitalism.
1. Workers connect to the purpose of the company.
Many employees lack a clear guiding purpose because their companies define themselves by their products. Instead, they should be highlighting what their products enable. For example, this commercial for IBM’s Watson doesn’t focus on the tech product itself; it focuses on how that tool can improve the life of a farmer taking advantage of AI insights. Internal communications should take a similar approach. Relating to a company’s greater purpose is one of Gallup’s 12 elements of engagement, and right now only 40 percent of employees can identify with that pillar. Gallup has found that when workers have a greater purpose serving as their North Star, their job becomes more than just work.
2. Engaged employees display more innovative creativity.
Gallup has also found positive correlations between employee engagement and innovative creativity, so those purpose-driven employees are likely to make big waves in your organization. In a survey of about 1,000 workers, 61 percent of engaged employees reported that they feed off of co-workers’ creativity, a sentiment with which only 9 percent of disengaged employees agreed. Plus, a whopping 74 percent of engaged employees brought those innovative ideas to customers. According to Raj Sisodia, co-author of “Conscious Capitalism,” the mindset he and Whole Foods CEO John Mackey advocate in the book leads to a deeper understanding of customers. That’s one of the undisputed keys to innovation and an important component of business growth.
3. Employees are excited to stay.
Replacing an employee is expensive — around 33 percent of the position’s annual salary, according to a report from Employee Benefit News. Fortunately, a focus on conscious capitalism can create a happier, more engaged workforce with much lower turnover rates. In a study of more than two million Benevity users, turnover was reduced by about 57 percent for the employee group most connected to a company’s charitable giving and volunteer efforts. At Microsoft, the company’s employee giving program, through which employees volunteered 700,000 hours in 2017, is so popular that it’s even a draw for candidates. Microsoft saw 75 percent participation in the program last year.
The term “conscious capitalism” implies that profit-minded businesses are “unconscious,” which isn’t the case. Creating a company that turns a profit definitely requires a conscious focus on creating value, both for customers and for stakeholders.
The difference is that broadening the scope of a business to focus on people and the planet has a number of desirable effects, not least of which is a more engaged, more innovative workforce. Focus on adopting the mentality of a conscious capitalist, and see what it does for your employees.