Andrew Hewitt – For-Benefit Companies Are Changing The World

A few years down the road, a career coach helping college graduates land the job of their dreams realises many are not thriving when the sole purpose of their work is profit maximisation. This makes him question the whole concept of success. Meet Andrew Hewitt, whose  Game Changers 500 ranks the world’s top for-benefit businesses that are not only good at making money, but also good at making the world a better place. I interview him while he hikes a mountain in the Yosemite national park and I sit indoors in Helsinki, shielded from the -28 degrees celsius outside. We are two worlds apart, but somehow we don’t notice the distance.

How did Game Changers 500 came about?

In 2010 I went to Costa Rica after being inspired in a half-day workshop called Awakening the Dreamer, organised by the Pachamama Alliance. It helped be recognise where we are really at as a human species, what assumptions of success have led us here, and what we can do about shifting the direction of humanity. It inspired me so much I booked a one way ticket to Costa Rica to find my role in “changing the dream of the modern world”.

Prior to Costa Rica I had written a book for students (The Power of Focus for College Studentsand reflected a lot about who we are and what we do. Many young people were still defining success as being able to work for a Fortune 500 company and I had been helping them in achieving that. Five years into the journey I saw some of the people I had been working with become really dissatisfied in settings where profit is seen as the whole purpose. That really struck me. Top talent is often recruited into large corporations where they feel miserable and where they often end up contributing more to the problems we face than solutions we need.

While in Costa Rica I reflected that we are in a path that is totally non sustainable and started to think business has to be part of the solution. While there, the idea of Game Changers 500 came to me. It has been unfolding ever since.

How would you define success?

Defining success is the name of the game. Games have objectives, rules, point systems. As a society our definition of success is almost like a subconscious game we set out to play. The question is, is this game worth winning? Many people are finding out in their mid thirties that this game is not worth winning. They are not feeling happy, they are stuck with rents and mortgages and working in places that don’t fulfil them. We need to  think of success as something that is not measured only by external circumstances. Instead I believe we are successful when we feel empowered despite our circumstances: when we are in a place of fulfilment, balance and gratitude despite what those external circumstances may be. Bringing positive change to the world requires that we start with our own sense of purpose, mission and values.

What about success in business?

The reality is that the all profit-at-all-costs ecosystem of corporations is often not supporting individuals who want to feel they are really contributing to society. We need a new definition of success in business. People want to have a sense of autonomy, to feel supported in their values, to get to use their strengths and most importantly to see that what they do is meaningful. This is especially true of Millennials who will make up 75% of the globe workforce by 2025.

This new game of business is defined as for-benefit rather than for-profit. The objective of a for-benefit business is maximising benefit to people and the planet versus primarily maximising profit to shareholders.

Gamers 500 is like a game board for those companies. It provides a framework that is easy to understand. I feel there has been different terminology and ways to understand this concept. People talk about social enterprises, conscious capitalism, blended value companies and so on. We need some consistency in how we describe and measure for-benefit for the concept to go viral. We can that way as Bucky Fuller would have said “build a new world that makes the old one obsolete”.

Why do you think we are seeing these changes in society now now?

It’s important to see how the world has changed in the past to look into the future. There is a Churchill quote that says that the further back you look the furthest forward you can see. Around 2008 I saw the financial markets were crashing. Was this a moment of turbulence or were bigger things happening? In looking at history I saw that major changes usually come about because of a number of factors, the most important of which is a shift in communication technology. With the printed press there was a massive shift in power from religious institutions to an era marked by terms like “the scientific revolution” and “the enlightenment”. This new communication technology allowed new beliefs to spread in a way, and at a speed, that was not possible before. The same is true of digital media today. The internet is a communication revolution that is allowing new beliefs to spread instantly and globally.

How do these communication technological advances impact social values?

What communication revolutions have tended to do throughout history, is support people in becoming more empathic. Jeremy Rifkin goes through this in his classic book.  We can now see people through social media who are in the other side of the world and we can see and feel our interconnectedness. We are moving from a world view of separation to interconnection.  We are learning about environmental destruction. This quick spread of information is increasing our concern for the planet and its people.

How do you rank companies in Game Changers 500? What are the criteria?

I am really excited about 2016. During the last 18 months we have dramatically updated our evaluation system. I had the privilege of joining a council of experts including researchers from Harvard, policy makers from the U.S. Government, and for-benefit business leaders. Together we developed clear definitions on what a for-benefit business is and how to measure impact.

We recognised that we are moving from a 3 sector economy: public sector (government), private sector (for-profits) and social sector (non-profits) to a four sector economy, which includes this new class of for-benefit entities that incorporate the heart of a nonprofit with the economic engine of for-profit. That is where the term for-benefit comes from. It’s the trending term which I believe will eventually be used to describe what is now being called all sorts of things: social enterprise, b-corps, conscious capitalism, etc. It’s important we begin using common terms so that this model of business can spread more efficiently.

Our new ranking system will start by looking at a company’s mission: their WHY’s. We also look at which of the sectors a company belongs to; and ask is it for-benefit? for-profit?

Secondly we look at HOW the business is operated; what kind of practices the company follows. And this is where the badges come in. We have updated our badges and created new metrics. The badges break down into 11 things: everything from considerate compensation to earth friendly energy. We look at how practices impact people (customers, employees, communities) and how they impact the environment.

The final category we evaluate is WHAT impact this company is creating. We measure this by looking at the 17 Global Goals for Sustainable Development which were set out by the UN last september. Our impact assessment looks at how much an organisation contributes to meeting these goals. Ultimately that is what we want: a thriving world that works for all life.

Does the Game Changers 500 get updated at a specific date?

It’s more like a game. It’s dynamic. It’s always the most up to date leader board. We will publish the list at certain points with our media partners but the vision for it is to be always up to date, like a game!

You are not part of Fortune 500. This is an arduous task. How have you funded Game Changers 500?

I have been funding this privately. This is a merit based list. Any company can qualify without paying any money. We are finding ways to monetize so we can continue to sustain this research while also supporting the greater mission. For instance, we are creating new services to support qualified organisations in communicating their mission more effectively, attracting growth capital that aligns with their for- benefit values as well as in recruiting talent.

Can one be for-profit and for-benefit simultaneously?

Yes. For-benefit companies are businesses, so they also earn a profit. Income is generated and sustains these companies. The key criteria that defines these companies is that they have a primary or exclusive purpose to maximise social and environmental benefit. There are different ways of demonstrating and proving that, which is what we do.

How is leadership changing in Game Changer companies?

We are seeing major changes in leadership teams and management structures. We are moving from hierarchy to holocracy; from a top down pyramid model to models where employees are treated more as entrepreneurs than employees.  We are seeing changes in pay, where the gap between bottom and top pay is much smaller than we are used to. For instance at Dr. Bronner’s, a natural products company the gap between top and bottom paid employees is small by design. We also see profit sharing and employee ownership plans. An example of that is Recology, a waste and recycling company in San Francisco that is on target to making it the first zero waste city in the world by 2020. They’ve already successfully diverted 80% of all trash in San Francisco away from the landfills. Perhaps this is because all of their team members are owners of the company. They are 100% employee owned using what’s called and ESOP.

These practices go to show that when you treat people as human beings, not human resources and you compensate them properly and empower them, you can get phenomenal results.

What other companies are inspiring you?

I like uncommon examples, like in the banking of waste industries. There is one company in Vancouver Canada, Vancity which is in the financial services industry that is unique in that it is one of few that earns all of our badges. It would be great to see other banks working like that. They invest into specifically prioritised projects to create  the most impact in the local community. They systematically measure everything. In their impact report, for instance, they look at employee and customer satisfaction as well as their impact on the planet.

MicroEnsure is a great example of how a global issue can be solved through an income generating business model. MicroEnsure is the micro finance of insurance. They studied how people in emerging markets are building a future to escape poverty but are also at risk of environmental and other disasters that set them back. They then developed a way to insure populations in emerging markets by partnering with telecoms, because they understand the one thing that everyone owns in these markets is a mobile phone. By providing free insurance local telecommunication companies can build loyalty. MicroEnsure doesn’t only help with a call centre if you have a claim. They also have a call out centre that helps people identify if they have a claim. They often call when they notice cell phone usage dropped, because that is often a sign that something has happened.

Patagonia is another company I respect a lot. They have been doing their business for so long and are a best practice in some many areas, such as supply and production. Tom’s is a perfect example of the buy one, give one movement and now there is a lot of other companies following that model. Zappos is of course really well known for how they treat their employees and customers. They were one of the first companies to get rid of job titles. They also have a program where everyone gets 50 dollars per month to give to another employee, to build connections inside teams.

How has working with students and your book The Power of Focus for College Students help you build Game Changers 500?

I allowed me to work with young people and really understand what their values and challenges are. It helps me work with companies that have this problem of recruiting and retaining Millennials. I can help them in their journey to become for-benefit, because that is what Millennials want. Redefining success means looking at things differently. Companies like Zappos don’t hire based on what school people went to. They hire based on values and a person’s qualities as a human being, whether you have passion for their mission and whether you will fit in their tribe.

Is there data that suggests companies that treat their employees and communities well outperform their competition?

Yes. Lot’s of proof. According to Harvard Business Review these companies generate 300% more innovation and have 125% less burnout. A Gallup poll also showed there is 40% more retention. It is estimated that only 20% of the brands are seen to meaningfully impact people’s lives. Yet 91% of global consumers prefer to switch to brands that support a good cause. That is a huge opportunity gap!

What is happiness to you?

I go back to what I said earlier. Life happens. Happiness is being empowered despite circumstance. Happiness is sustaining a state of gratitude.

What do you see as the most underrated value?

Contribution, which is ultimately a human need. It’s being a giver, not just a getter. The media praises getters. But contributions are made from giving, not getting.

What is the most overrated value?

Power; it’s the ego’s grip of wanting to feel in charge and being significance. It increases the belief that we are separate from other humans, rather than interconnected and interdependent on each other.

Do you have a life motto?

Choose love over fear, whatever the circumstance.

Photograph by Renee Airya

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