Ethical Business – PART TWO BELOW
This is PART TWO of an article on Ethical Business co-created with rebuildingsociety.com. For PART ONE please go to: https://www.rebuildingsociety.com/where-it-comes-from-matters/
It is very important to run an ethical business as a business – keeping firm control of finances, maintaining excellent customer service and developing business strategies for future growth. Many ethical businesses look for and gain investment to help them grow – you can’t do this without being able to demonstrate a working financial model and projects so that investors have faith in you. There are organisations to help with this – we’ve been involved with the School for Social Entrepreneurs (SSE) and the Cambridge Judge Institute incubator for Social businesses, Cambridge Social Ventures.
Unfortunately many ethical businesses will fail, just as small businesses often do. However by existing at all they have enhanced consumer expectations of what can be offered. This puts pressure on other brands, especially the bigger brands, to meet those expectations and so they are directly changing the ethical market even if they don’t succeed themselves. Whether an ethical business succeeds or not, they are creating a legacy to be proud of.
What advice would you give to companies trying to be more ethical without negative commercial impact?
There are two angles to this. Firstly if a business is wanting to change its operations to fit with its own personal values – perhaps the board wishes to drive a business towards a Fairtrade agenda or to become an environment friendly company – then the most important thing to do would be to define those values. Then a business task to look at moving from current working practices to those which meet those values would be necessary, for example a business who wants to cut down on plastic packaging to meet an environmental goal would need to explore alternative packaging options and price them accordingly. It’s important to remember that even if the change is slightly more expensive, there will be benefits in terms of customer perception which may offset that. Also there is a story which can be used for PR, but beware of green washing – it’s not popular!
Secondly, if a business is wanting to attract more values driven customers the way forward would be to look at their current customer base and ascertain which values may be of importance. Talking to customers through surveys and emails will bring out some of the areas that their customers feel strongly about.
Is being more ethical better business? Can we have cakes and eat them?
My entirely personal view is that being ethical is better business. I don’t mean that it is more lucrative because my personal experience is that it is not! However connecting our values to what we do as business owners, workers and consumers is much more satisfying – it is far easier to feel passionate about work when you believe you are changing the world for the better at the same time!
Also, ethical businesses are making huge contributions to the areas they support. As well as driving customer expectations (as mentioned above) we also directly help our beneficiaries in a number of ways – through charity donations, upskilling and community enhancement, campaigning for causes and improving production techniques to make less impacts on the planet.
Thank you Jo for your superb insights! Thank you very much indeed. You’re completely lovely!
This article was co created with Bird Lovegod, in association with Peer to Peer lender rebuildingsociety.com