As we begin to wrap up the year and move into the season of giving, some company owners are contemplating their business’s mission:
- Are we giving back enough?
- Should we be better stewards of the environment and society?
- Can we accomplish these lofty goals in a way that is financially beneficial to our stakeholders?
These are the purpose-driven business owners who have a corporate mission with higher aims than making a profit. Many such owners want to do well by doing good, and they want to structure their businesses to accomplish their end goals.
Consider three clearly mission-driven companies that are appropriately structured to address their ambitious goals. Each business has its own approach, and each has a corporate configuration designed to support its philanthropic plan.
Jelly structure factors in environmental, societal goals
While you probably haven’t heard of Jelly, a new Web app company, you may have heard of the company’s CEO. Christopher Isaac “Biz” Stone was a co-founder of
Among other things, his new company has been working on an app called "Super." The idea is to let users create a kind of digital postcard by mixing Web-based stylized images with text.
Jelly is a benefit corporation, also known as a B-Corp. A benefit corporation is a new legal business entity that has legislation effective in 22 states. The overarching idea of a B-Corp is to allow directors and executives of for-profit companies to factor in corporate goals of helping the environment and society.
These companies are not charities, and B-Corps have a fiduciary duty to make money. But success is not to be measured solely in financial terms.
In fact, transparency provisions in the law require B-Corps to publish annual benefit reports of their social and environment performance. Biz Stone sees this structure not only as a way to give back but also as a great opportunity to recruit highly mobile and motivated young talent.
New Belgium Brewing now 100 percent employee-owned
This third largest craft brewer in the country is a company with a bigger mission than tasty suds. Kim Jordan, the co-founder and CEO of New Belgium Brewing, started as a Quaker-educated social worker. And she’s carried her social worker principles into the business.
Her two passions, environmental stewardship and the importance of co-workers, are built into the company’s corporate configuration.
Structurally, the company is an Employee Stock Ownership Plan (ESOP) with a B-Corp designation. In other words, the company is owned by a qualified employee benefit plan designed to invest primarily in the company’s stock. Effectively this makes the employees the owners of New Belgium Brewing.
In fact, in 2013, through the purchase of Kim Jordan and her family’s remaining stock, the company was able to announce they’re 100 percent employee owned.
The B-Corp designation allows New Belgium to not only focus on profit but also on environmental well-being. For example, according to their website, they voluntarily pay a premium for their utility bill to ensure the power supplied by Fort Collins, Colo., comes from the cleanest source possible. And New Belgium’s energy-efficient kettles heat twice as quickly as standard ones, providing natural gas savings.
The idea is to promote both transparency and benefit the public. The company boasts that it is “giving back and advocating for positive change in our communities.”
Life really is good at Life is good, Inc.
Life is good, Inc., with its unpretentiously lower-cased name, laid-back smiley-face of a logo and life-affirming slogans, is a different kind of company from first impressions on.
The smiley guy on their T-shirts, hats and all other kinds of apparel is named Jake. The simple tagline, “Life is good,” speaks to his iconic countenance but also to the company’s higher purpose.
Life is good, Inc., distributes through thousands of retail outlets in all 50 states and 30 countries. It’s amazing to think that this business was started so recently. In 1989, two brothers began selling their designs out of an old van in the streets of Boston, mostly at colleges and street fairs.
I saw Bert Jacobs, the "Chief Executive Optimist" for the company, speak at the Inc. 500 conference. It was instantly clear he is a genuine advocate of the “conscious capitalist” movement. And he has built his passion for people into his marketing plan.
His philosophy is almost counter-intuitive. Instead of first trying to make a bunch of money, then donating a portion of the proceeds, they flip the equation. Much of the company’s marketing is done through community outreach and philanthropic activities.
For example, they may fund a community event and hand out free hats with Jake’s smiling logo. Is that marketing or donating? Bert Jacobs would argue it’s both.
The company may start by giving to the community, but in turn, they get back loyalty and future customers. He makes note of Millennials’ particular attraction to products and services delivered by companies that give back as a key to the company’s future.
The essence of this company’s structure is that they build their passion for social responsibility into their marketing approach. They both give back and get back through targeted marketing and promotion campaigns.
Through this approach, they not only support the bottom line but benefit society. And just for good measure, when they’ve made their profit, they give 10 percent of it to kids in need.
Whole Foods. The Container Store. The list of companies focused on conscious capitalism goes on and on. If you, too, want your business to stand for more than mere profit, a key step is to concentrate on how your business is structured. Whether through corporate formation, employee ownership or marketing strategy, it is important to lay out how you and your business will give back. Done correctly, you’ll get back as well.
