12 Mar Coronavirus | Impact on Purpose Led Organisations
In one respect, the decline of air travel due to coronavirus is good news for the environment. Less flying equals less carbon emissions. The other side of the coin suggests revenue loss of 11% worldwide which may de-emphasize voluntary efforts to reduce carbon emissions.
It is easy to be committed to social and environmental impact when things are good, but the true challenge presents itself when things are bad in business. This is where purpose led organisations face their first true test. With business declining all around the globe, companies from retail to healthcare to banking are finding themselves busy with keeping operations going instead of focusing on purpose as much.
The purpose movement has no doubt been one of the most powerful forces changing the way we do business in recent years. Equal pay, gender diversity and inclusion, and sustainability reached a peak among consumers, employees, and investors.
Putting financial goals over purpose commitments now could be disastrous for these leaders and their businesses. However, people who care about their “why” will be watching closely. If business leaders move away from their commitment, being purpose driven rather than putting every dollar first because of a tough year, will lose their credibility and goodwill.
Korn Ferry Institute, a global consulting firm states that already some companies are pushing for relief. At least one European airline cited the virus as a reason to delay imposing new environmental taxes on air travel. Similarly, despite new laws in the United States that require female representation on public company boards, noncompliant organizations could use the coronavirus as an excuse for delaying appointments, says Jane Stevenson, vice chairman of Korn Ferry’s Board and CEO Services practice. “If an organization’s purpose is really just smoke and mirrors, then it will be easy for them to reposition,” she says.
Rather than stepping away from business purpose, the why, the core of the organisation, leaders should use the outbreak to think about where their business is uniquely aligned to contribute and help. You might not be able to fulfil all your goals this year but think about how you can lean into the opportunity of honouring your purpose.
Take Loom as an example. Loom is a screen and video recording platform. As a result of the COVID-19 they responded with longer trial periods & a 50% fee cut on their subscriptions to help contain the spread by helping you meet virtually with your clients and colleagues, rather than meeting face-to-face. https://www.loom.com/blog/coronavirus-response
Taking care of employees, physically and mentally, is a core value for purpose driven organisations.
Divina Gamble, coleader of Korn Ferry’s Non-For-Profit, Philanthropy, and Social Enterprise practice, says that the coronavirus outbreak can ultimately strengthen the purpose movement. She sees an opportunity for investors, entrepreneurs, and governments to create companies and organizations in healthcare and other fields to help better prepare for future crises. “This could lead to a lot of innovation from a public-health standpoint,” Gamble says.
But, she says, to really show that organizations and leaders are authentic in their desire to demonstrate how positive social impact is equal to financial performance, “they will have to prove it now when the stakes are this high.”