Blockchain is the engine that will drive Impact Co’s
Authenticity of impact is shaping the next generation of business models, and blockchain will power their emergence
Most businesses understand a key emerging reality. That being a purpose-driven company striving to have a positive impact on the world drives growth in their business. It creates a deeper, more resilient connection with customers who are themselves driven by increasingly strong ethical, environmental and social values.
A recent survey by Deloitte demonstrated that 79% of millennials believe businesses have the potential to solve the challenges that concern them (only 57% believe that businesses are doing so, however).
The case for purposeful impact driving growth is becoming self-evident, but you only need to look at Unilever’s sustainable brands growing 50% faster than the rest of the business to grasp the direction of travel.
Some companies still think that articulating a socially-positive purpose is a marketing ploy. Words crafted to smooth the rough edges of an aggressive, sharp-elbowed (“disruptive” in Silicon valley speak) business model.
But a well-crafted corporate purpose or company mission statement does not mean anything in reality. Consumers understand the difference between words and action.
Uber is “Creating possibilities for riders, drivers and cities” and has previously stated “For cities, we help strengthen local economies, improve access to transportation, and make streets safer. When you make transportation as reliable as running water, everyone benefits.”
However, given the behaviour of Uber as a business in dealing with it’s own drivers, the troubles with company culture, being caught attempting to manipulate the press and resignation in disgrace of it’s CEO consumers are leaving in droves.
Even those that stay will only stay for the low price and availability — leaving Uber as a company with a significantly heightened risk that customers will leave as soon as a viable alternative option emerges. But the issue isn’t just confined to Uber.
The real question is how far are companies’ rhetoric and marketing from the reality of the company’s operations and culture. Because it is not purpose in isolation that is crucial for consumers, but authenticity of purpose.
But the question of authenticity is currently extremely hard to get any kind of answer on for any company in the world. Even the most authentic companies in terms of purpose and impact suffer by association with the likes of Uber. There is little in-built trust in any company.
Instead, this trust has needed to be built over time. Companies with decades of capturing and telling the stories of their purpose and impact build up some degree of trust, but even then there is a suspicion (sometimes bang on the money) that companies cherry pick the best, most impactful stories of how they have made a positive difference and every other story goes untold.
And all of this trust can be fundamentally damaged by just one part of a company. In 2015 Volkswagen were found to have deliberately gamed the environmental emissions tests for its cars. The reality was VW engines emitted nitrogen oxide pollutants up to 40 times above what is allowed in the US. The group chief executive at the time, Martin Winterkorn, said his company had “broken the trust of our customers and the public” and resigned shortly after.
“My most urgent task is to win back trust for the Volkswagen Group — by leaving no stone unturned,” incoming CEO Matthias Mueller said on taking up his new post.
VW embarked on the recall of millions of cars worldwide and it has set aside €6.7bn (£4.8bn) to cover costs. That resulted in the company posting its first quarterly loss for 15 years of €2.5bn in late October 2015.
A BREAKTHROUGH OPPORTUNITY TO BUILD TRUST
What if we could build a system that ensured it was virtually impossible for any organisation to make false claims? A system that closed the gap between the lofty rhetoric and opaque operations of companies?
Well, there is just such a system emerging. Blockchain.
Blockchain has the potential to underpin the claims of companies, charities or even governments about the veracity of their claims to create a better world.
But what is it?
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This is first article in a mini-series looking at the potential of blockchain to drive innovation and impact in business models. The other articles are:
2 What is blockchain? (A ludicrously simplified example.)
3 The potential of blockchain (and 3 use cases)
It is drawn from a part of the Futures work we do at Frame Labs where we work with companies that seek to understand, interpret and invent the future.
Other articles will be published in the next few weeks.
