Institute For The Future

Aligning Business and Community Interests: A Recipe for Hope in Volatile Times

Robert H. Girling’s latest book, The Good Company, uniquely sets the business in the broader context of its relationship with people, the environment and the global community.  Girling presents a refreshing array of new business approaches that create new value beyond the bottom line and serve to shake up the status quo.  A must-read today, this book gives hope for renewal in our volatile times.

Girling, a professor at Sonoma State University in the School of Business and Economics, recognizes that business-as-usual is no longer an option.  Consumers are changing - we are demanding greater transparency in the products we buy and how they are produced.  The old business model is rapidly depleting our natural resources. Employees want to feel that they’re contributing to a better world. Growing inequities are undermining our communities as well as the buying power of consumers – the lifeblood of a company.  As Girling puts it, the old business model has become dominated by narrow self interest, greed, arrogance and insensitivity to the greater good.  A good company is “a business that looks beyond the private profit that benefits shareholders and investors to include the welfare of employees who produce the products and services (as well as those of its suppliers), the community that hosts the company, and the environment that supplies the natural resources” (page 23).

There are a growing number of businesses reflecting a diverse mix of industries and new business approaches that provide more evidence that a successful business model can in fact be based on doing good. One of the most exciting examples is the growing movement around the Benefit Corporation, which revises corporate law to consider non-shareholder interests as a legal responsibility of corporate directors.  Eleven states have passed legislation allowing businesses to incorporate as Benefit Corporations.  In addition to supporting the passage of legislation to allow for this new legal designation, B Lab also provides third-party certification for companies that want to become B Corps.

Interface Carpet is an iconic example of a company going beyond the bottom line to pursue the creation of new environmental and community value.  Although familiar to many, it remains a compelling story. Other examples in The Good Company offer new inspiration for business leaders, aspiring entrepreneurs and those of us who study business and economic growth.

Girling describes businesses that are successfully responding to change and driving change and includes references to related work of other scholars. Our context is continually changing and the pace of change is quickening.  In his book, The Second Curve – Managing the Velocity of Change, Ian Morrison describes how businesses need to shift from their traditional business along the first curve to the second curve, the emerging future context.  Those who hold to the old business model, ignoring shifts in the global economy and environment, will find themselves on a downward curve (e.g. shrinking markets, constrained inputs, stalling revenues).  The upward curve is where new business models are forming in a dynamic space reflective of the changing context.  Businesses on this emergent curve will be inherently more resilient and agile as our context continues to shift.

Our changing context demands new business models that generate a broader definition of new value, incorporating people, the global community and the environment.