Working with a Purpose

In a paper published in the Harvard Business Review, authors Thomas W. Malnight, Ivy Buche, and Charles Dhanaraj described an eight-year study of three forces believed to be the biggest drivers of company growth: creating new markets, changing the rules of the game, and serving larger stakeholder needs.(1) In the process, they found a fourth driver that proved to be the most important of all: purpose. They wrote: 

Companies have long been encouraged to build purpose into what they do. But usually, it’s talked about as an add-on—a way to create shared value, improve employee morale and commitment, give back to the community, and help the environment. But as we worked with the high-growth companies in our study and beyond, we began to recognize that many of them had moved purpose from the periphery of their strategy to its core—where, with committed leadership and financial investment, they had used it to generate sustained profitable growth, stay relevant in a rapidly changing world and deepen ties with their stakeholders. 

This, to us, is an excellent definition of Massive Transformational Purpose. 

Malnight, Buche, and Dhanaraj weren’t alone in their findings. Indeed, over the last few years, the notion of purpose as a company’s defining force has been elucidated in the most unexpected places. For example, Larry Fink, CEO of investment giant BlackRock, has stated that his company will focus on purpose-driven organizations. And the Unilever example from above shows the concrete positive monetary outcome.

During the same time period, several new financial terms and organizational structures have emerged, reflecting a new emphasis on purpose. These include Benefit or B Corporations, the Triple Bottom Line, L3Cs, the Conscious Capital movement, and the Slow Money movement. These entities leverage their MTPs to integrate social and environmental issues—as well as profits—into their business processes. Many of them fall under the rubric of social enterprises.**

(1)  **Put Purpose at the Core of Your Strategy