A new report has outlined how business could play a role in tackling key environmental and social challenges and support recovery from the coronavirus pandemic.
Published by research group ReGenerate, the study makes four recommendations on how the UK Government can support a more purpose-driven business environment.
This includes the introduction of a new ‘traffic light’ labelling system to make it easier for consumers to identify and support purpose-driven businesses.
The report also calls on the government to create a clear legal framework for purpose-driven businesses to ensure they are protected to operate “in a way that benefits society”.
ReGenerate said the proposed reforms have been backed by a number of business leaders, including James Timpson and Schroders chief executive Peter Harrison.
The calls follow on from research published by ReGenerate last year, which revealed the majority of the UK public (53%) think that capitalism is the best ‘way to manage society’, but that it ‘needs to be fixed.’
YouGov polling from 2020 also revealed that half of UK business leaders believe an organisation should be driven primarily by purpose, not profit.
Meanwhile, a similar survey from McKinsey showed that nearly three-quarters (72%) of employees believe that purpose should be a greater focus that profit in business.
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Ed Boyd, co-founder and executive director of ReGenerate, said the report and its recommendations come at a pivotal time for British business.
With the country beginning to move out of the pandemic and the challenges of the last year, there has never been a better time to enable business to help society.
“We are at a moment in history where the challenges we face are significant, but so are the available resources to tackle them,” he said.
“Much of this resource is held in the innovative power of businesses. They are keen to play a bigger role in helping tackle the world’s woes. It would be crazy not to enable them to do so,” Boyd added.
Concerns around climate change and the UK’s ability to meet net-zero targets are another key focus of the report.
ReGenerate urged the government to provide “global leadership” on impact measurement at G7 and COP26 to ensure that companies are able to easily understand and report how they impact society.
This could be achieved by “creating a clear policy goal to make the UK a centre of excellence” for impact reporting.
The report also called on the government to “turbo-charge” support for companies that aim to tackle environmental or societal challenges, such as reaching net-zero or recovering from the pandemic.
“ReGenerate’s report is as timely as it is needed,” according to James Timpson, chief executive of Timpson.
“The reforms it contains will help ensure businesses make their full contribution towards the big social and environmental challenges we face,” he said.
Making purpose-driven business the “new normal”
ReGenerate said the paper’s reforms “bring to life” its vision statement for the future of business, which envisages an environment where purpose-driven and values-led business will become the “new normal”.
By definition, a purpose-driven business exists to benefit society and views profit as one of the vital outcomes of its business activity, as opposed to being the sole reason for its existence.
Already, the ReGenerate vision statement has gained significant attention and has been signed by over 70 business leaders.
Sir Ronald Cohen, Chair, Global Steering Group for Impact Investment and Author of Impact, said the “innovative power of business” will be crucial in helping recover from the social challenges created by the coronavirus pandemic.
“This ReGenerate paper is a welcome contribution and its reforms would help make the impacts of businesses far more transparent and drive support of businesses that seek to have a more positive effect on society,” he said.