We make a living by what we get, but we make a life by what we give.”
– Winston Churchill.
By Ed McLaughlin and Wyn Lydecker
If you center your startup around profit, your company can use its economic strength to become an ambassador for social impact on any level, large or small. Just as passion for a business project requires the distinctive competence to carry out your vision, a company’s social impact is built up, enlarged, and sustained by profit.
Many of today’s entrepreneurs are forming social enterprises that have two missions and two bottom lines: one for profit and one for social impact. The Center For Social Impact of Sydney, Australia, describes social impact as: “… action taken by businesses, government, social purpose organizations and knowledge creators that contributes to creating a positive, meaningful and sustainable change for the benefit of society and particularly those at disadvantage as a result of systemic, long-term problems.”
Here are two companies that have crossed the starting line, made a profit, and reached the second bottom line: social impact. When companies like these are committed to being social enterprises, their profits fuel and heighten their social impact.
Patagonia founder, Yvon Chouinard, had his first lesson in social responsibility when he realized the climbing pitons he was selling to climbers were destroying the integrity of the climbing rocks. Climbers repeatedly drove the metal-spiked pitons into the rocks to anchor themselves for the climb. Now, thanks to Patagonia’s efforts, spring-loaded camming devices and nuts, have largely replaced the pitons. Today on the Patagonia website, you can see the company’s seven deliberate commitments to social impact and a link for full disclosure on each one.
Patagonia’s Commitment to Social Responsibility
- The Footprint Chronicles: A map of world-wide locations of Patagonia’s textile mills, factories, and farms. Each location icon tells how Patagonia is positively impacting the local culture: how production standards respect the environment, what product is produced at each location, and the gender mix and number of workers employed.
- Vote the Environment: Offers a chance to register and get involved in upcoming pro-environment election decisions.
- Corporate Responsibility: Tells how working conditions throughout the Patagonia supply chain are safe, fair, humane, and legal.
- Environmental Grants and Support: Shows how 1% of sales are donated for the support of environmental organizations worldwide.
- Becoming a Responsible Company: Shares the story of how Patagonia became committed to social responsibility.
- Common Threads Partnership: Explains how the company is committed to recycling and reducing consumption by maximizing the use of existing clothing gear. (Our note: Only a profitable company could engage in the cause to reduce waste and to encourage less consumption of the very product they produce.)
- Patagonia clothing is “Fair Trade Certified.” That means the company pays a premium to Fair Trade USA, which ensures that the lives of the community and the workers who make the clothing are improved because of their employment.
Eco Nuts founders Mona Weiss and Scott Shields launched an eco-friendly laundry detergent startup in 2009 with the desire to provide an economically and environmentally responsible cleaning product.
A Soap Company with a Big Impact and Small Footprint
Eco Nuts have a fleshy shell that surrounds a large pit (seed). They grow on the “Soap Berry” tree in the Himalayas, and the shell naturally contains saponin, which is a cleanser. Like other cleansers that break the surface tension of water, allowing the water to penetrate the clothes fibers and rid them of dirt, the saponin in Eco Nuts does the same job, but it does it more cheaply, naturally, and with energy-efficient, recyclable packaging. Every family of 4 that uses Eco Nuts, saves over 14 plastic laundry jugs from entering the land fills each year.
Eco Nuts Products – As Seen On Their Website, http://econutssoap.com
After starting with one laundry product in 2009, the founders pitched ABC’s Shark Tank in 2012 and wound up turning down a funding offer in favor of using their own profits to create more products and grow from within. Today Eco Nuts is making a social impact with a projected $1 million in 2014 revenue. In addition to their commitment to quality, service and the environment, Eco Nuts uses its profit to fulfill a commitment quoted on their website: “To support local and global charities, environmental and community groups to the best of our ability.”
Watch “Eco Nuts” in action! – This video was made by an Eco Nuts customer.
It’s Your Turn
It is our hope that stories like Patagonia and Eco Nuts will inspire you to take a strategic leap and realize your dream to start your own business. If you center your startup around profit, you can set your course for that second bottom line: social impact.
Are you gravitating toward starting your own business? We invite you to click here and receive our free download, “The Pull To Become an Entrepreneur!”
Ed McLaughlin is currently co-writing the book “The Purpose Is Profit: Secrets of a Successful Entrepreneur from Startup to Exit” with Wyn Lydecker and Paul McLaughlin.
Copyright © 2014 by Ed McLaughlin All rights reserved.