Deep responsibility is not a term generally associated with business. Often, the conversation around responsibility tends to centre around Environment, Social and Governance factors (ESG) and Corporate Social Responsibility (CSR). Not without reason, as these factors are measurable and mandated by regulation.
But ESG and CSR are not enough to be a responsible business, says Geoffrey Jones, Professor of Business History at Harvard Business School, and author of the book ‘Deeply Responsible Business: A Global History of Values-Driven Leadership’. According to him, deep responsibility is more intrinsic to the fundamental nature of an organisation.
“You don't spend decades doing unpleasant things and then wipe off your reputation through acts of philanthropy. I think there has been so much rhetoric about purpose and responsibility which is close to greenwashing or whitewashing.”
“The reason for that is, deep responsibility is complex and costly because businesses have to compete with convention in the short term. If you are a public company, it can also cause a great deal of difficulty from investors. But in the long term, businesses see stronger brand value,” says Jones.
To attract and retain high-quality talent, to be agile and innovative, to out-perform incumbents, organisations need to cultivate not just a compelling purpose and culture but a truly regenerative mindset.
Jones is of the opinion that a deeply responsible business is designed to make a positive impact in everything it does – from how it makes its products to how it treats its stakeholders and employees. Such a business recognises that it has a license to operate from society and works with governments rather than lobbying for special interests he explains.
Deeply responsible businesses also support and enhance local communities with jobs, education, cultural facilities rather than displacing or decimating them.
While Jones is not against offshoring, he says it is much easier for a local business to be deeply responsible. That is because firms rooted in communities tend to give back and support those communities.
“To attract and retain high-quality talent, to be agile and innovative, to out-perform incumbents, organisations need to cultivate not just a compelling purpose and culture but a truly regenerative mindset,” explains Giles Hutchins, author of Leading by Nature and co-author of Regenerative Leadership.
“There is a rising zeitgeist around ‘regenerative.’ Yet what regenerative truly points to is a journey of becoming more in harmony with life – both for the leader and for the organisation."
Hutchins argues that to be truly regenerative, a business must transform its internal culture, values, and daily practices, as well as its external characteristics such as its value propositions, stakeholder relationships, and impact on society and the environment.
He cites the cases of Vivobarefoot, a footwear company, and AXA Climate, a climate consultancy, as examples of regenerative businesses that prioritise social and environmental benefits alongside profitability. These companies recognise that reducing negative impacts on the planet is not enough. Instead, they aim to go beyond by shifting from traditional, transactional, and linear take-make-waste models to circular and synergistic solutions that enrich the communities and environments they affect.
All profits are not equal. Some profits do more good to the world than others. And I think a deeply responsible business will seek to maximise its profits while seeking to solve the world's problems, rather than creating problems for the world.
For instance, Vivobarefoot sells shoes that are scientifically proven to improve human health and uses bio, natural, or recycled materials such as algae-based EVA foam, plastic waste, and wild hide leather from small cattle herds.
Similarly, AXA Climate offers consultation services for regenerative adaptation to climate change and biodiversity loss in the agri-food, industrial, financial, and public sectors. It also insures vulnerable people and businesses against natural disasters and funds regenerative agriculture.
Hutchins believes that businesses like these foster a Developmental, Emergent, and Evolutionary (DEE) culture that encourages individuals to become more conscious and responsible while enabling the organisation to evolve to be more agile, responsive, and resilient to change.
“In cultivating DEE conditions, we create organisational spaces that can hold these tensions while welcoming our whole selves to work, where we learn, grow, explore, and experience together,” he explains.
“The organisation’s inner culture, values and behaviours influence its outer brand, value propositions and stakeholder relationships. Vice versa, the changing nature of the organisation's outer-market and stakeholder ecosystem influences its inner culture.
Building this virtuous cycle of deep responsibility is a time-consuming process. While experts differ about whether some sectors and industries are better suited than others to be more responsible, they say that intent is the primary factor that distinguishes a good business from others.
“All profits are not equal. Some profits do more good to the world than others. And I think a deeply responsible business will seek to maximise its profits while seeking to solve the world's problems, rather than creating problems for the world,” says Jones.
“Deeply responsible businesses are not miraculously perfect organisations. They all have trade-offs, but they are all going forward in a certain direction.”