A global study has found businesses can succeed financially by embracing critical global issues.
The research, which involved Melbourne’s Monash University, explored social profit orientation, a concept where organisations simultaneously generated profit and fostered societal well-being.
Professor Leonard Berry said the study found businesses could achieve financial success by embracing, as a core mission, critical global issues such as climate change, poverty, human rights violations and medical breakthroughs.
Professor Berry said social profit orientation differed from corporate social responsibility in that social progress was part of the organisation’s central mission, rather than a by-product of its activities.
He said the study investigated social purpose organisations such as financial services organisation Oportun and educational not-for-profit First Book, but also included the global giant Salesforce and Australian medical research organisation, the Children’s Cancer Institute (CCI).
“It found both for-profit and not-for-profit organisations achieved a competitive edge, attracted top talent and drove innovation when adopting a social profit orientation.”
Professor Berry said the life-quality challenges of modern society, such as climate change, poverty, hunger and homelessness, inaccessible healthcare, wars and pandemics, altered what society needed from corporations and other organisations.
“Generating financial profits, noble and important, is no longer enough. Society needs organisations to invest their skills and resources to also create social profits through initiatives that specifically enhance the well-being of people and/ or the planet.”
Co-author Professor Tracey Danaher said social profit orientation could be the next step for corporate social responsibility, “to push for profit and nonprofits to go further to tackle some of the grand challenges the world faces, including addressing climate change, poverty, hunger, inequality, as well as better access to healthcare and education.”
