For author and academic Isaac Getz, it’s the companies quietly embracing altruism and social responsibility that are in the strongest position to ride out future disruption
A Japanese pharmaceutical company is perhaps not an obvious place to look for a workplace revolution. But in the early 1990s, under the direction of its new president Haruo Naito, pharma giant Eisai quietly began to transform the way it did business. Instead of focusing on the bottom line, from then on Eisai would prioritise what it called “human healthcare”, first and foremost seeking to relieve the suffering of patients and their families.
Naito invited each department, from sales and marketing to finance, to rethink their business processes with this new goal in mind. For instance, instead of simply trying to sell drugs to doctors and hospitals, the sales teams focused on getting the right products to the right patients, who in the main were suffering from dementia or Alzheimer’s.
One sales manager in a poorly performing district, where GPs refused to meet with sales reps, set about educating older people on how to avoid falling – one of the major causes of hospital visits in that age group – through a series of lectures and demos on how to make their homes and habits safer.
A year later, when the manager tried to call the GPs again, they were eager to meet up, having heard good things about Eisai from their patients. The manager doubled her sales in six months. “She didn’t do anything to sell, but by changing the way she worked and by generating social value through caring about her clients, the result was economically successful,” says Isaac Getz, professor of leadership and innovation at ESCP Business School in Paris and co-author of L’Entreprise Altruiste (The Altruistic Enterprise).
It’s just one example – out of the thousands of businesses Getz has studied over the past 20 years – of a company turning social purpose into stronger business fundamentals, leaving it in a much healthier position in the long term. It is, he suggests, a valuable way to shore up a business against bumps in the road, and it’s a message that’s gaining traction in these uncertain times.
Why build a virtuous network?
Getz first made a name for himself back in 2009, when he coined the term “liberated companies” – that is, businesses which transform themselves to take unconditional care of their employees and become more economically successful and resilient as a result. He outlined these in the book Freedom, Inc, which became a global bestseller amid the 2008-09 recession. His ideas were seen as a call to arms, spawning the “corporate liberation movement”, whose advocates include the tyre manufacturer Michelin and sports retailer Decathlon.
Then, in the early 2010s, Getz began to look at the nature of external relationships between businesses, their clients, their supply chain and members of the local community, highlighting networks which thrived when companies did everything they could to maximise the social and environmental value of that ecosystem through mutual trust and authenticity.
In L’Entreprise Altruiste, published in 2019, he cites several examples of companies that have transformed themselves radically for the greater good – and become stronger as a result. Along with Eisai from Japan, he mentions Handelsbanken, a Swedish retail bank which operates in the UK and provides such good service that its customers often mistake it for a private bank.
During Covid, the bank was working with a UK company making ventilators, which were naturally in high demand, not least within the NHS. When the company placed a large order for parts from overseas, Handelsbanken staff worked evenings and weekends so that it could be processed in just seven days, rather than the usual two to three weeks.
“They decided it was a dire situation and therefore important to act for the local community,” says Getz. “This bank is very community-orientated, so they did everything they could and then didn’t charge extra fees to the client. Can you imagine the consequence of that action? How much goodwill it would foster and how people would speak about you to others? It becomes a virtuous circle.”
How to embed purpose authentically
Crucially, Getz explains, it’s not a question of businesses acting in a calculated way – it’s just about doing what feels right. In a similar vein, Michelin provided free tyres for ambulances in China during Covid, while Sterimed, a French manufacturer of high-end sterile medical packaging, used its logistics expertise to import millions of masks at a crucial point in the pandemic.
Sterimed started by providing the masks to its employees, then gave the 20,000 masks it had going spare to local businesses in the area, and then began to import on a far larger scale for the wider community – a service it performed without making any margin and by fronting the production costs themselves. “At that time, mask prices had skyrocketed, but Sterimed didn’t do it to make money. They did it to serve people,” says Getz.
Of course, that kind of attitude doesn’t appear in a business overnight. Getz says it’s not so much a change in the way you do business as a radical transformation, and it takes time. “It typically takes small and medium-sized companies about three years to transform and large corporations about 10 years,” he says. “It’s a profound thing. You can’t just go on a training course; you have to transform the nature of the relationships that have been embedded in the organisation since it was founded.”
But it is possible to start the journey towards becoming more resilient via clear social purpose. As Getz explains: “It goes back to those processes you’ve built where your first thought is, ‘How can we unconditionally serve this client?’”
In companies adopting this mantra, he says, the role of the controlling manager disappears, because they become facilitators of social purpose instead. And while you do need a good leader to steer the transition, you also have to involve the majority of your managers and executives for the transformation to work.
Reaping the benefits – quietly
For Getz, one of the most positive outcomes from being a genuinely purpose-led business is that it helps with talent recruitment. “We know that millennials see purpose as an important social value,” he says. “Ninety per cent of job candidates in this group don’t want to work for a company that is purely focused on financial and economic profits. They want a social mission and purpose, and if you offer that, you will attract a larger pool of candidates than your competitors.”
He adds that studies show purpose-led companies also find it easier to retain their top talent, smoothing out the bumps and disruption which high staff turnover can cause. “The research is clear; people are willing to earn less money to do purposeful work, and they’re more likely to stay engaged and loyal to a business that does positive things for society instead of being purely focused on making money.”
But Getz also warns that brands shouldn’t shout too much about what they’re doing. “We have a saying in France: ‘Le bruit ne fait pas de bien, et le bien ne fait pas de bruit’ [‘In fame there is no virtue, and in virtue there is no fame’]. There is so much bragging and purpose-washing around, so the more you speak, the more suspicious people become,” he says.
“The companies I’ve studied didn’t tend to speak about what they were doing,” Getz explains. “It took me two years – as a researcher, not even as a journalist – to get into Eisai in Japan and meet the president. They didn’t want to promote what they were doing, and Handelsbanken were the same. Naturally, these stories still come out, employees speak about it on social media and journalists will find out, but they’re not doing it for that. They’re doing it because they think it’s the right thing to do, and they’re benefiting in the long run as a result.”