Mars refreshed it a few weeks ago, but Japanese firm Kongō Gumi mastered it about 1,440 years ago. A strong corporate purpose motivates employees, triggers customers, and favours long-term performance.
Chosen as 2018 Marketing Word of the Year by US-based Association of National Advertisers, purpose is more than ever in brands’ sights. From using the power of sport to move the world forward (Nike) to bringing health through food to as many people as possible (Danone), from spreading optimism (Life is good) to promoting equal opportunities through equal digital access (Open Fiber), purpose states the real mission of a company, the primary need it is willing to act on with its resources and capabilities.
Confectionery and pet-care multinational Mars has just unveiled its new mission statement and brand purpose “Tomorrow starts today”, but the concept is far from being new. Japanese shrines and temples construction firm Kongō Gumi has continued to pursue its purpose of bringing calm to people’s minds since its foundation about 1,440 years ago.
Today, purpose defines the ultimate meaning of Corporate Social Responsibility: no more a satellite strategy, but the only possible option for businesses to achieve the right to exist and operate. “Sustainable development is the way we do business, an ambition that encompasses all of our company’s activities”, to say it in Henkel’s words.
But why is it such important to define and communicate a distinctive purpose, expressing the will to have an impact on environmental and societal issues? We might offer three main reasons.
Purpose aligns people within the company, stating the common aspiration that binds them together. It adds sense even to day-to-day, routine work by raising it to a higher level. As most employees are disengaged, purpose inspires energy and commitment since being part of a collective effort to accomplish a worthwhile goal, and helps create resilience in face of business and social change. That’s particularly true for Generation Z (the post Millennials), who are now entering the labour market and tend to choose employers fighting climate change and racism, supporting carbon-positive policies and human rights.
More, getting purpose right is important to address the increasing expectations of customers, who look for enhanced corporate activism to clarify the role businesses want to have in economy and society, and responsibilities they are ready to take on. We used to say that people don’t buy products, but stories – the moment has come to move one step forward, as consumers are now more likely to prefer purpose to brand storytelling.
Last but not least, there is the economic benefit. Organisations with a relevant purpose perform better than those without one, even in the long-term run. And that’s exactly what Larry Fink, CEO at BlackRock, wrote in his 2019 letter to investors.