In the late 80s, the City of London was transformed through Big Bang’s deregulation of the stock market and the explosive growth in financial services that ran its 20-year course until the Financial Crisis in 2008. This bull market fostered a culture in banking and business focused on the pursuit of Profit. It was a world presaged by Ayn Rand where individualism was epitomised by The Fountainhead’s key protagonist Howard Roark and organisations bucked against bureaucracy and collectivism for the common good. Corporate Social Responsibility lived on one page of the annual report and the pursuit of Profit was everything.

Wind the clock forward 30 years to today. Since the Financial Crisis in 2008 we have seen something different: 10 years of austerity and the creation of a new free-spirited generation, liberated by the collective capability of the internet. CSR has evolved with today’s generation wanting to work for Purpose-driven rather than purely Profit-focused organisations.

The openness and transparency of social media has allowed everyone to become campaigners and publishers in their own right. And in this more transparent and open society, many stakeholder publics are demanding brands to think well beyond the selling of day to day products and services. In a recent PwC survey, 80% of business leaders said that an organisation’s Purpose is central to business success. And the statistics bear this out. Purpose driven organisations are a beacon for new talent and they motivate existing workforces to go the extra 5% and to work for something bigger than themselves, giving them a sense of pride. Data also shows that consumers believe that Purpose-driven businesses are more caring and they therefore show them greater loyalty. Profit surely follows in Purpose’s wake.

Brands that truly act on their Purpose build trust through the more rounded delivery of better performance and impact. And while Purpose may eventually drive Profit, both Purpose and Profit are separate elements of transformational and higher performance. So, as this new generation of workers gain experience and become leaders of our society, will they continue to think of business performance less as linear progress in terms of Profit and more as an evolutionary transformation of broader value to them and success in their lives? How will the balance lie in the future between Purpose and Profit?

I’ve been interested recently by George Monbiot, the environmental and political activist, who has been writing on Capitalism, whether it is dead and is there a better way? He is compelling about what doesn’t work, but not yet there with the answer of what next, clearly a difficult issue. He grudgingly acknowledges that growth has helped some parts of development, but that this always comes with a downside, with environmental pollution in the air or at the bottom of our oceans being key. Gita Gopinath, IMF Chief Economist, has also reiterated that Capitalism and growth has lifted a billion people out of poverty but that there have been losers along the way such as exploited workers and those who suffer from pollution and waste. She believes that domestic policies are clearly needed to balance Capitalism and look after those that need support. And then there is Greta Thunberg, the Swedish climate activist, warning us that we have only 10 years to avoid cataclysmic climate change. She may well be right and in today’s society where people believe that there is more value in Purpose than Profit driven business, the sense that we are drifting towards a disastrous unknown and that society is not doing enough about it is surely going to stimulate further reaction.

So, in my view Purpose does drive Profit, but I suggest that both coexist today in balance to create greater transformational value. But now, as urgent questions are asked around climate change and our own footprint in the world, are we able to answer Monbiot, Gopinath and Thunberg?

I believe we should demand a different and even better performance from business and more Purpose-driven actions to solve society’s problems. And as we do this, we should see how we can create the next leap forward in the way we think about transformational value for business and society. Purpose and Profit are key indicators today, but there is surely an even better path forward where we redefine Capitalism again and ensure that we leave our planet properly secure for future generations. That as yet undefined notion of higher performance will likely make Purpose and Profit seem rather quaint and old-fashioned.

This essay was first published in One Question, Volume Four following Simon’s participation on the Media Panel at One Question Live 2019.