Three questions were posed in a recent publication by McKinsey & Co. article on “Our future lives and livelihoods: Sustainable and inclusive and growth” <<https://mck.co/3Ghv1bt >>:
- Growth – Without growth, how will we achieve prosperity and well-being or pay for the transitions needed for a more sustainable and inclusive economy?
- Inclusion – Without inclusion—an opportunity for productive work and life satisfaction for all citizens—how will we ensure the demand that propels growth?
- Sustainability – Without sustainability, how can we have a long-term, tenable view on growth for this generation and the next?
The intent clearly was to make the case for linking social prosperity and well-being to the relationship of growth, inclusion, and sustainability – with growth being the cornerstone.
Hard to argue with. Unless we ask “what kind of growth?”.
Surely we don’t need more of the cornucopia of consumer goods we already have in much of the industrialized world. And yet consumerism is deeply engrained in our way of life.
Can we engage our moral imagination[i], using a business lens, by asking these questions?
- What does society need if we are to live in a world that works for all – “where people, businesses, and economies, all thrive, now and for future generations”?
- What if we seek new corporate growth opportunities that generate mutual value for both the company and the communities within which it resides – value that goes beyond greater consumption by the few; value that has a net-positive impact on inclusion and sustainability?
- Might it be that forging a world with new systems of prosperity, justice, equality, opportunity, participation, environmental health, and human experience could open vast new routes to corporate prosperity – not by minimizing damaging impact but by elevating positive contribution?
We long for our institutions, not just in government, education or healthcare, but also in the corporate sector to embrace this needed role of forging a world that works for all. However, despite dramatic innovations in technology and the world of material objects, our results in designing healthy, effective, and flourishing human systems, have been highly inconsistent. History shows that such work is difficult but not impossible. The goal is to do more of it.
One solution is to increase corporate capacity for identifying, seizing and acting upon new business opportunities at the intersection of real value for both the corporation and the communities within which they operate. Many articles have been written about this idea, but it appears we do not yet have the widespread capacity in our corporate ecosystem to undertake this work, for many reasons. This profit-through-purpose strategy is easier to talk about than do, but not impossible.
But, imagine for a moment that we succeed in developing the tools, methods and business practices needed by corporations to apply their strengths in innovation and execution to this new profit-through-purpose strategy.
This is the challenge that we have set for ourselves – to make such transformation easier, faster, and less risky. To take the best of what works now, leverage and innovate it, try it and improve it. To give corporations and their partners in this work (be it value chain members, community organizations, government agencies or other civil society entities) the means to successfully collaborate in what we are calling Co-Creating Mutual Value.*
A Starting Point
As Porter and Kramer[ii] in their work on Creating Shared Value (https://bit.ly/3I6tyq1) have said:
“The starting point for creating this kind of shared value is to identify all the societal needs, benefits, and harms that are or could be embodied in the firm’s products. The opportunities are not static; they change constantly as technology evolves, economies develop, and societal priorities shift. An ongoing exploration of societal needs will lead companies to discover new opportunities for differentiation and repositioning in traditional markets, and to recognize the potential of new markets they previously overlooked.”
Yes, but how? How to engage and work productively with diverse voices – let alone align enough of them for forward movement?
The Journey’s Human Side
The decision to undertake and stick with a journey that may not generate immediate financial returns requires more than an edict from the CEO. What’s needed is:
- oxygen for the fresh ways of thinking so often already in alive in the corporation
- growing the partnership possibilities already within the corporation’s ecosystems, just waiting to be energized
- better ways of moving forward that accelerate the pace, minimize risk while maximizing learning and generate benefits in the process
- the understanding and active support of multiple constituencies, including but not limited to Board members, investors, employees, regulators and so on
- brilliance in reconceiving products and markets, redefining value chain productivity and building supportive industry clusters*
- additional innovation not only in creating new value through new products and services but also innovation in new ways of delivering value or new ways of capturing value.
As the McKinsey article concluded:
- “No stakeholder can solve all these problems on their own. A clear road map, with buy-in from others, is paramount, as is a framework of incentives that balance short- and long-term horizons and interests across value-chain.”
- “Tackling these challenges successfully will require multiple experiments, unprecedented speed in scaling successful ones, and broad participation across actors.”
The Practical “HOW” – the Co-Creating Mutual Value idea
The idea is simple. Most of the corporate contributions to society have come in the form of CSR (corporate social responsibility) work – primarily philanthropic efforts and efforts to do less harm. Many of these CSR efforts are costly to the bottom line or at best in the category of “cost reduction”.
Few such efforts have been conceptualized at the intersection of creating profit for the corporation and meaningful value for society – let alone the idea of doing this with ecosystem stakeholders vs for stakeholders. These two shifts are simple in concept and can be tectonic in execution.
At the core we need new conversations – conversations between people who don’t normally talk with each other; conversations that don’t repeat old patterns but bring new ideas, commitments and relationships to life; conversations that are rich in both substance and ways of talking that open rather than close possibilities.
This is the contribution of what we describe as Co-Creating Mutual Value:
- the practical “HOW” of collaboratively identifying shared purpose and opportunities for mutual value creation and then taking action together … to fulfill each partner’s expectations while forging a world that works for all, and
- a “HOW” of customizable stages, ideas, conversations-that-matter, and actions – designed to successfully engage diverse stakeholders in innovation at this scale and produce results.
PS: In our experience, journeys of this nature rarely succeed if driven ONLY by the desire for financial gain. Prosperity is a sine qua non but so is the recognition that this is the right thing to do.
We invite you to find out more, join us, work with us and support us.
https://co-creatingmutualvalue.org– a not for profit dedicated to Accelerating the ability of businesses and their ecosystems to prosper BY building a better world.
1A fuller description of what is meant by “moral imagination” can be found in the article “Examining the Impact of Moral Imagination on Organizational Decision Making” Lindsey N. Godwin July 11, 2012 in Business and Society
2 As part of our belief that the fastest way forward is not to reinvent the wheel but to build on ideas that offer promise, we want to acknowledge the works of Michael Porter and Mark Kramer on what they call Creating Shared Value; the work of Bruno Roche and Jay Jakub and their work on what they call the Economics of Mutuality; as well as the work of Paul Polman and Andrew Winston on what they call Net Positive. These authors have all contributed substantially to our journey of developing and openly sharing a practical “HOW” for this work.