The business landscape has changed forever, and sustainability is becoming more important due to a range of pressing global issues – from social upheaval to climate change and Covid-19.
Modern organisations must be candid, open and communicative with consumers today, many of whom question how a company operates and increasingly hold them accountable for their business practices, with firms like Uber recently having to implement workers’ rights to its drivers.
Purpose-driven firms are now appearing across Scotland, not only as a way to aid the recovery from Covid-19 and to combat climate change but to provide customers with alternative options in an increasingly competitive business landscape.
Organisations such as FutureX, the Edinburgh-based organisers behind Startup Summit and Impact Summit, aim to nurture and support these upcoming firms, curating content to build a ‘more sustainable, socially-conscious global economy’.
Leading the charge is FutureX co-founder and CFO Zoi Kantounatou, a Greek national that used her passion for – and saw the importance of – purpose-driven business after the world was left reeling in the wake of the 2008 financial crisis.
“For me, it was a big understanding of how we can use businesses in a different way to avoid what happened, and how we can make sure that we create something different,” Kantounatou says.
Driving Value-led Business
FutureX runs a series of events relating to business throughout the year, and up next is Impact Summit. The event is for all organisations and individuals that “dream of a thriving global economy that puts people and planet at its very heart”.
Kantounatou believes an event like Impact Summit is important in the current climate because it is a “celebration of the world we want to see,” particularly as we emerge from the pandemic.
“It’s about coming together to talk about purpose-driven business and celebrate businesses that have chosen that approach,” she says.
And this could be exactly what the world needs right now. The business landscape is dominated by industry giants like Amazon and Apple, some of whom are using the wave of consumer-led accountability to ‘ethics wash’, frequently pushing the language of sustainability and social consciousness despite evidence suggesting otherwise.
Kantounatou believes this rhetoric is dangerous and that believing in purpose-driven business is vital: “One of the reasons why purpose-driven businesses are powerful is because they’re based on trust and trying to do good.
“When you have other companies falsely using this way of promoting, it becomes dangerous because it creates mistrust.”
We now live in a world where deception and fake news is commonplace, especially during the pandemic and the US election campaigns which saw social media as a platform to spread misinformation.
This can have a profound impact on a small, purpose-driven business trying to prove itself, with consumers sometimes failing to believe what evidence suggests. Kantounatou says that being more informed of what firms are out there, what their mission is and how they operate is important.
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Consumers need to detach themselves from the business brand and “constantly review” where they buy and shop, Kantounatou explains. A lack of belief has caused the evolution of cancel culture in society, and many businesses are falling foul of it.
Snap consumer judgements, brought on by the rise in misinformation, means small mistakes can cost a business heavily. A large company like Amazon can take the financial hit, but for a smaller firm the impact could be disastrous.
However, Kantounatou says she does see consumers making an effort to become more conscious of value-led businesses.
“I have definitely seen a change between now and seven years ago. People are demanding more and being more outspoken about what they expect.”
Kantounatou says she sees ‘tech for good’ becoming a big part of how purpose-driven businesses interact with customers, and how Scotland will emerge stronger from the pandemic.
“We are living in a world where technology exists and using technology to solve our problems is the thing that will make a difference.”
The problem with the pandemic
And technology has certainly seen exponential growth during the Covid-19 pandemic. As we emerge from a series of lockdowns, businesses will be looking to continue pivoting their business models to cater for online sales.
The coronavirus, Kantounatou says, is an opportunity to come out stronger: “This is a problem worth solving and we really need to put our resources forward — and we should do it because we feel that this will make the world a better place.
“Purpose-driven business is so open and diverse, it is not just one particular thing, it is about how you make decisions; It is about how you treat your employees; it is about how you treat your consumers; how transparent you are; how you lead.
“It is not only about how we solve the pandemic to make sure that we go back to a different world, but also about flexible working and how you treat your employees. We definitely see purpose-driven businesses stepping up on those topics: it’s about finding this balance between limited financial resources and not being able to work, but actually doing something in the right way.”
Covid-19 has certainly forced all of us to consider what our future holds post-pandemic, particularly businesses that need to get back on their feet.
On top of this, the increasing effects of climate change and the advent of a hard Brexit means the business landscape seems uncertain. Driving a business forward with a purpose means more consumer trust and stronger gains in the future.
Finding your footing
However, trying to start this type of business in this type of landscape will not be easy. Kantounatou has some advice for how business leaders can stand out in a landscape dominated by big businesses which are more likely to succeed in a period of crisis.
“I would advise people to be very clear about what they’re doing,” she says. “Be very transparent, focused and ambitious and know that it is not going to happen overnight.
“Take a bit more time because the world is such a turbulent place at the moment that we don’t know what’s going to happen next. We need to be aware that it is probably going to be a slower start than it would have been before.”
As well as this, with industry supply chains and the economy having been deeply impacted by the pandemic, small firms are going to find it difficult to stay competitive, especially if they do not have the resources to compete with large companies.
The best way to support these businesses to succeed, Kantounatou says, is to actively steer away from the convenience and low cost of big firms, and start shopping more locally.
She says: “Convenience is not everything. By supporting small companies, they will have the resources to focus on convenience and focus on doing things cheaply.”
At the moment, sustainability is expensive, and the products that are sustainable are more expensive, but in terms of how the economy works, the more we support these businesses, the less expensive it will become, as they will be able to compete in a different way.
“It will take a bit more time and conscious effort to be able to do this, but I believe that the rewards will eventually be bigger.”
Impact Summit | Join the Conversation
Impact Summit will take place online on 19th & 20th May 2021. For more information and tickets, visit www.impact-summit.org.