When thinking about the legacy of Safaricom’s first CEO, Michael Joseph, one noble thing that comes into mind is the Mpesa Foundation and precisely the Mpesa Foundation Academy, which is a state-of-the-art high school that provides world-class Kenyan education to students from poor backgrounds. The school focuses on moulding future leaders and entrepreneurs by incorporating the core values of Curiosity, Leadership, Accountability, Innovation, Responsible Citizenship and Excellence (CLAIRE) into every sphere of learning within the Academy. The regenerative business model by Safaricom enabled the establishment of The M-PESA Foundation that integrates the use of mobile technology in its investments while focusing on areas of greatest need and impact. While Kenyans enjoy the ease of cash transfer through the Safaricom’s Mpesa platform, they also get to support children from poor backgrounds to access world-class education. What an intriguing model for Mpesa customers to support social good!
Like Safaricom, many companies are investing more resources into regenerative business models for social good. Similarly, society is increasingly turning to the private sector and asking that companies respond to broader societal challenges. BlackRock, the largest investment management company in the world, reports that socially responsible investing has been on the rise. Black Rock’s CEO Laurence Fink’s January 2018 memo to CEOs, “A Sense of Purpose,” challenged companies to adopt a greater sense of responsibility or “lose their license to operate.” Nielsen Holdings PLC, a global information, data, and measurement company, invested $11.2 Million in pro-bono work and in-kind giving projects delivered to universities and non- profits organizations across the world.
Vision beyond Profits
Business models that correlate every dollar made with a measurable unit of social or environmental improvement are the new norm. The B Impact assessment scorecard by B Lab demonstrates that corporations could improve societies and environment without compromising their bottom line. Market-driven altruistic models help consumers associate their positive social impact for every cent spend on a product, which provides “trickle up economics” whereby a company invests in the community that ensures long-term social and economic sustainability. Take Guayaki Yerba Mate, for example Its market driven regeneration business model drives rainforest stewardship, carbon drawdown, and indigenous culture resilience. Through the model, Guayaki Yerba Mate has been able to sequester 573g of carbon for every 454g of yerba mate produced while providing farming communities with a renewable income stream based on regenerative, soil-enriching, and carbon-reducing planting techniques.
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To integrate a Regenerative Business Model, Carol Sanford identifies seven principles: Whole, Potential, Reciprocity, Essence, Nestedness, Nodal and Development. Within a single organization, a regenerative business model may include strategies related to increasing transparency of the supply chain, attracting purpose-driven consumers, and managing environmental impact or building diversity of the workforce. The model seamlessly blends business, social and environmental goals together. Such models are anchored on purpose- driven era of business that advocates for a balance between purpose and profits. The purpose driven regenerative model calls for a shift of brands and business embedding strategies to help realize the Global Goals agenda, which has an estimated $12 trillion value.
The next phase of sustainability and regenerative business models calls for understanding the intricate relationships between consumers, businesses, community, environment, and the resulting impacts on global climate change. As is evidenced in Nielsen’s Annual Global Corporate Sustainability Report, a wave of consumers with more established sustainability values are on the rise and rewarding companies that authentically embody sustainability values into their products and workplaces. By integrating sustainability through an authentic and socially conscious brand story, companies could establish brand value and loyalty, which would help set them apart from the competition. Additionally, social goods hold unwritten social contracts with their communities; by engaging in the community through philanthropic work, businesses can establish a brand that people feel good about.
Former BP plc CEO, Lord John Browne notes, "Purpose is the litmus test of sustainability in business. Companies that want to be around for decades to come must ensure that society is at the heart of everything they do." Adopting a regenerative model in a must for companies having a tough time in advocating for social good while growing their bottom line.