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Posted 3.30.15

Chris Laszloby Chris Laszlo, PhD, associate professor of organizational behavior at Weatherhead School of Management and co-author of Flourishing Enterprise: The New Spirit of Business, Stanford University Press, 2014.

 

When the CEO of Starbucks Corporation inserted his company into the debate around race relations in the United States, he triggered a multitude of reactions, most of them critical. Howard Schultz was roundly derided for suggesting that baristas engage customers in a conversation about one of the most controversial issues of our time.

While many people questioned how Starbucks could implement its #RaceTogether initiative, few asked the more valuable question of why they would attempt such a thing.

Schultz’s commitment to social causes is well known and Starbucks has a long history of community engagement. Howard Behar, former Starbucks president and the author of It's Not About The Coffee: Leadership Principles from a Life at Starbucks, once wrote, “Caring is not a sign of weakness but rather a sign of strength, and it can’t be faked – within an organization, with the people we serve, or in the local or global community.”

StarbucksThis culture of caring and engagement is a major reason baristas pour coffee at Starbucks for less money than other jobs in their same skill-set and are more likely to take advantage of the benefits offered to them than employees at other companies.

But the true significance of #RaceTogether goes far beyond the initiative of any one company. Progressive businesses are undergoing a fundamental shift. They are increasingly adopting the principles and practices of flourishing enterprise. They are searching for social impacts that are good for the bottom line and good for the world. Flourishing enterprise is not about being green or socially responsible for its own sake. It’s a smarter way to do business in a marketplace that expects companies to help build a better world. Among its many business benefits, flourishing enterprise inspires employees and customers to be far more creative and collaborative. It helps businesses raise their sights and aim for a greater role in the world.

Several years ago, businesses rushed to adopt the concept of sustainability. They were driven to demonstrate their responsibility to society and the environment. They attempted to show that they could be profitable without doing harm to our world. For example, a growing number scrambled to adopt low carbon practices as a way to communicate how “green” they were.

Today, businesses are going beyond sustainability to adopt goals aimed at doing good rather than only doing less harm. Consider the Tata Group, an Indian conglomerate that designed a $22 water purifier that works without electricity and provides potable water to the poorest, thirstiest areas of the world. Or Natura, a Brazilian natural cosmetics manufacturer, which employs a sales network of one million people, most of them among the poor. The broad commitment of such companies to a range of social initiatives has helped them become hugely successful businesses.

Flourishing enterprise has the power to engage customers and supply chain partners. It can unleash the potential of an organization’s employees while reducing employee turnover.

Starbucks’ recently revised mission statement reflects a flourishing culture: “To inspire and nurture the human spirit one person, one cup, and one neighborhood at a time.” Although baristas will no longer write #RaceTogether on coffee cups and engage customers in a conversation, other elements of the campaign such as employee forums will continue.

Most organizations may not have the stomach, or the desire, to take on the controversial issue of race. But the global economy is moving toward a stance that encourages bold action. Businesses are increasingly becoming agents of world change that touch everyone from the leader of a global conglomerate down to the smallest entrepreneur.

Proactive business executives capable of communicating such a vision and implementing meaningful change are increasingly embracing flourishing enterprise. These leaders will play a significant role in the fundamental shift in business as an agent of world benefit. 

 

Learn more about flourishing enterprise and the Fowler Center for Business as an Agent of World Benefit.

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