International research involving Monash University has shown that businesses can achieve financial success by embracing as a core mission critical global issues such as climate change, poverty, human rights violations and medical breakthroughs.
International research involving Monash University has shown that businesses can achieve financial success by embracing as a core mission critical global issues such as climate change, poverty, human rights violations and medical breakthroughs.
A major study published in the Journal of Marketing has explored social profit orientation, a concept where organisations simultaneously generate profit and foster societal well-being.
Social profit orientation differs from corporate social responsibility in that social progress is part of the organisation's central mission, rather than a by-product of its activities.
The research has been led by the topic's world expert Professor Leonard Berry from the Mays Business School, Texas AM University with researchers from Monash Business School, Gabelli School of Business at Fordham University, Tobin College of Business, St John's University and NHH Norwegian School of Economics.
The study investigated social purpose organisations such as financial services organisation Oportun and educational not-for-profit First Book, but also included the global giant Salesforce and Australian medical research organisation, the Children's Cancer Institute (CCI).
It found both for-profit and not-for-profit organisations achieved a competitive edge, attracted top talent and drove innovation when adopting a social profit orientation.
"The life-quality challenges of modern society - climate change, poverty, hunger and homelessness, inaccessible healthcare, wars, pandemics, and more - alter what society needs from corporations and other organisations," lead author Professor Leonard Berry said.
"Generating financial profits, noble and important, is no longer enough. Society needs organisations to invest their skills and resources to also create social profits through initiatives that specifically enhance the well-being of people and/ or the planet."
Co-author Monash Business School's Professor Tracey Danaher from the Department of Marketing said organisations with this orientation proactively invest resources such as knowledge, infrastructure, labour, reputation, money and time to enhance the common good, improving the well-being of people and safeguarding the health of the planet.
"We found that the organisations with a social profit orientation benefited through enhanced reputation and trust, stronger stakeholder relationships, improved employee retention, engagement, and attraction, which ultimately positively impacted their financial performance," Professor Danaher said.
Australian example: Children's Cancer Institute (CCI)
Children's Cancer Institute (CCI), which focuses on researching new treatments with the aim that more children survive their cancer to live long, healthy lives, was one of six Australian organisations interviewed in the study.
One initiative pinpointed in the research is the ZERO Childhood Cancer precision medicine program, led by CCI in partnership with the Kids Cancer Centre at Sydney Children's Hospital, which offers all children with cancer in Australia access, for the first time, to a program that allows researchers to identify personalised treatment options based on the genetics and biology of their individual cancer.
Professor and Executive Director of CCI Michelle Haber said, "CCI's ZERO Childhood Cancer initiative aims to provide the most comprehensive paediatric precision-medicine program in the world by using all available genomic data from each child's cancer, to identify the optimal treatment."
Professor Danaher said social profit orientation could be the next step for corporate social responsibility, "to push for profit and nonprofits to go further to tackle some of the grand challenges the world faces, including addressing climate change, poverty, hunger, inequality, as well as better access to healthcare and education."
How to build a social profit orientation:
- Align employee and organisational values to create a unified mission.
- Ensure organisational resources and governance structures maximise societal benefits.
- Inspire executive and board leadership to deeply commit to social profit goals.
- Make informed investment decisions that focus on initiatives with the greatest social impact.
- Measure and evaluate social impact rigorously to ensure meaningful contributions.
- Foster external partnerships and communicate purpose through compelling storytelling.
Read the full paper in the Journal of Marketing: Social Profit Orientation: Lessons from
Organizations Committed to Building a Better World. DOI: 10.1177/00222429241258495
Leading social profit organisations:
- CGIAR (Consultative Group on International Agricultural Research)
- ZERO Childhood Cancer initiative, Children's Cancer Institute
- Gundersen Health System
- First Book
- Oportun
- Salesforce
- Rescue Agency
