I was at a business conference a few days ago. A company was pitching itself as an incubator for seed stage social entrepreneurs. Usually when the word “social” is used in this context it means that a company (in this case, the incubator and the companies the incubator would incubate) has some purpose beyond maximizing value to shareholders. Often this means that the company is a non-profit but not always. Sometimes, as in this case, it just means that the company “gives back” somehow. Often there is discussion of some kind of “higher purpose” that forms the credo of the company.
For a “normal” company, the “goal” of the business is usually to do something like maximize value to shareholders. What does this mean? It means that the company must produce goods or services that customers willingly purchase. The company selling the goods or services makes money while the customer gains the good or service at a price they are willing to pay. That customer then goes out and lives life, presumably happier or more efficiently or more effectively or whatever than before. The company has earned some profit and can continue to employ people (customers of other businesses) and make goods and services that customers want to purchase. What the company and what the company’s customers ultimately do is live, exist, interact with the world. While there is no “directed”, mandated, ordered “higher purpose”, isn’t living for that “higher purpose” what we all – as customers or employees or owners – do in all that we do? Just because it is not explicit, not ordered, not mandated by some credo does not mean it doesn’t exist.
When companies express some higher purpose, I am always confused. What higher purpose? What could be more noble than to create a good or service that some other person is willing to pay for? They payer is, after all, giving you a part of their life (their time, their money) when they purchase something from you.