Purpose Without Total Commitment Is Meaningless

Can Companies Do Well by Doing Good?

Prof. Ioannou’s latest article on sustainability and strategy in the Harvard Business Review confirms that companies can do well by doing good:

“Our exploratory results confirm that the adoption of strategic sustainability practices is significantly and positively associated with both return on capital and market valuation multiples, even after accounting for the focal firm’s past financial performance.”

This is good news, but how should companies react to it?

The article suggests that companies considering the adoption of sustainability practices are arriving at a crossroads that questions their motivation: “Are we doing this to survive or compete?”

Of course, it is both. But there is a third and more important factor to consider that makes adopting sustainable practices in the hope of achieving either objective a fool’s errand. That factor is commitment.

The Problem With Half-Hearted Sustainability

Unless a business is totally committed and motivated by a genuine human desire to contribute to a future that benefits all its stakeholders, any actions it takes will be seen as little more than a branding makeover. A company that simply adopts sustainability to gain competitive advantage or to appear to care is bound to fail in the long run.

There are many examples of this, but ExxonMobil is a case in point, as highlighted by the #ExxonKnew campaign and The Economist’s recent article on the oil industry and climate change.

Only by defining or redefining the core purpose of the business and putting ‘doing good’ front and center of its strategy—ensuring every single function of its operation actively aligns with a cause that matters beyond making money—can a business truly demonstrate that it is worthy of the support and essential resources (money, time, ideas) of its stakeholders.

Commitment: The Key to Sustainable Business

In the final chapter of my book CORE, I tackled the need for commitment. To introduce the subject, I quoted the acclaimed economist and strategist Pankaj Ghemawat, whose 1991 book Commitment: The Dynamic of Strategy helped shape my early thinking about the potential of Single Organizing Idea (SOI). He wrote:

“Commitment is the only general explanation for sustained differences in the performance of organizations… What needs to be emphasized is that the degree of commitment in regard to choices ensures that they can lead to sustained differences rather than merely transient ones.”

For further reading, David Grayson, Chris Coulter, and Mark Lee underline the need for total commitment in their aptly titled 2017 book All In. It’s time businesses and business leaders made that commitment.

Making Purpose Real With SOI

Single Organizing Idea (SOI) is a proven methodology conceived by Neil Gaught that enables businesses to integrate purpose at the core of their strategy, operations and decision-making. It aligns commercial success with positive social and environmental impact by ensuring that a company’s purpose is embedded in every aspect of its business model. Rather than being an add-on or marketing tool, an SOI serves as a guiding principle that shapes how a business operates, competes and delivers value to all stakeholders.

About the Author

Neil Gaught is the author of CORE: How a Single Organizing Idea Can Change Business for Good, published by Routledge.

Find CORE here:

CORE was a finalist at the 2018 Business Book Awards.