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What is Corporate Purpose?
More often than not, when you ask someone: “what does corporate purpose mean?” you might get an answer filled with cliches and big words that leave you more confused than when you started.
So, let’s cut out all that and get straight to the bones of it. Your corporate purpose is basically the crux of your business’s identity – it’s a statement that should outline the difference you’re trying to make in the world.
In our opinion, it should encompass three really important things: commercial success, social accountability, and responsibility.
Why is Having a Corporate Purpose Important?
Without a good and proper understanding of corporate purpose, it might just feel like a ‘nice but not important’ exercise. However, when it’s done right, your corporate purpose will drive confidence from your shareholders, inspire your employees and put your business on course for sustainable and meaningful growth.
Accountability is now a massive decision-making driver for consumers. This means that companies who embrace a meaningful corporate purpose (and stick to it!) are setting themselves up for future success.
Companies Doing it Right
Now we’ve run through what corporate purpose is, let’s take a look at some businesses that are really smashing it in this space:
To accelerate the world’s transition to sustainable energy.
Tesla
Notice how there’s no mention of products or selling in Tesla’s corporate purpose? It’s all about getting the world into a more sustainable position quicker. Nourishing families so they can flourish and thrive.
Kellogg’s
Who’d have thought you could make cereal feel so inspirational? Whilst at first you might think this is a big leap when you think about Kellogg’s as a brand it really does come through. To us, Kellogg’s brings with it images of family, community, and full bellies at breakfast.
"To empower people and create economic opportunity for all."
eBay
eBay comes to us with a statement about putting everyone on a level playing field. It’s allowing the platform to be seen as accessible to all.
"To inspire and empower youth culture."
Foot Locker
Again, no mention of shoes and footwear. A focus on empowerment and making a real difference.
That’s only a couple of examples, but can you start to see a pattern? Your corporate purpose should demonstrate how you’re going to make a difference in the world. If you miss the mark on this, you’ll run the risk of losing customers and even employees.
Where to Start With Creating Your Corporate Purpose
So, we know what good looks like – now what? Where do we even start when it comes to writing your own corporate purpose statement?
Here are our top tips to help get you started:
Using the Four Circles
Your corporate purpose should lie at the heart of these four circles:
1. What does the world need? What problem are you and your business going to solve? How important is it to your customers? What are the long-term benefits you’ll offer? This should be the heart of your corporate purpose, as it’s what will set you apart from your competition.
2. What economic value will you add? Nowadays, it’s more important than ever that your business helps to provide opportunities for others, not just yourself. This could be in the form of creating new job opportunities, giving back to the local community or even helping your customers grow and better themselves.
3. What are your people passionate about? Your employees are at the heart of your business, so it makes sense that your corporate purpose reflects the difference they want to see in the world also.
4. What makes you unique? True original ideas are few and far between, so what makes the way your company does things unique? It’s important you outline why you are the best choice over your competitors.
Focus on the Wider Good
It feels like we’ve really been hammering this point home, but that’s because it’s so important. Don’t focus on the products or services your business offers, but instead highlight the underlying human need you’re addressing.
Foot Locker aren’t selling shoes, they’re empowering youth culture. Kellogg’s aren’t flogging cornflakes, they’re helping families to thrive. Make it more about the why, rather than the what and the how. Once you’ve focused on the why, next think about if that why is needed. Not only will this help you to stand out to your potential customers, but it will also leave you with the ability to broaden your horizons as your company grows – as you haven’t boxed yourself off with specifics.
Connect with What You Care About
When we say ‘you’ here, we don’t mean just the managing director. We don’t mean just senior leadership members. We mean everyone, from front-line staff to top-level management.
Getting personal when it comes to company purpose is so critical. When your company’s purpose aligns with the passions of your people, what will it do? Well, it will get everyone excited and geared up around working towards a common goal.
Ask These Five Questions
Once you’ve drafted your company purpose, how can you sense check it to make sure it’s up to scratch?
Well, a good rule of thumb is to stress test it against these five questions:
1. Is it meaningful?
2. Is it authentic?
3. Is it credible?
4. Is it powerful?
5. Is it compelling?
If you can answer each of these with a ‘yes’, you should have a corporate purpose that reflects your business and its people, is clear and easy to understand, and highlights why you’re unique and the difference you’re trying to make.
If you’ve got this far, you’re likely very much on the right track to completely nailing your corporate purpose.
There you have it, our initial shallow dive into how you can craft a corporate purpose that actually means something. It’s no easy task, your corporate purpose will underpin every aspect of your company – so it’s not something you should treat lightly!
You might have more questions around what to do if your company has moved beyond your corporate purpose, or how often you should be reviewing it? That’s totally understandable, and it’s also something we can help with. If you’re looking for more advice, guidance, and assistance around ensuring your corporate purpose aligns with your brand identity send an email across to info@zest-learning.com.