Does Your Business Have Values?
A values-led approach to business is becoming increasingly important now that people are more ready than ever to vote with their feet.
Etsy will remain a “values-led company” even now that it has floated on the stockmarket, Etsy CEO Chad Dickerson wrote in a blog post. “We intend to keep our operating philosophy now that we are a public company, and [our investors] share our values and vision.”. It was important to the company, said Dickerson, that representatives from the Etsy community were able to participate in the IPO, so the company reserved 15% of the stock for them. “The investors we met on the roadshow understand that the key to Etsy’s long-term success is building on and extending what has made Etsy successful to date,” said Dickerson. That is, an “inspired community” of entrepreneurs, buyers who want unique merchandise, and a “values-led community-based business that focuses on the long term”.
For many companies, floating on the stock market means having to answer to shareholders and analysts, who’re usually in it to make money. For businesses used to being privately owned, this can be a major transition as the public markets can sometimes have a more impatient approach to profit growth than a private backer with a long-term view. Of course, you could argue that for Etsy it wouldn’t make sense to deviate from the path that’s made the company what it is: a sales portal for homemade crafts valued at $1.8 million at the April floatation. If values got Etsy to where it is, then values it is from here on.
“Financial success is important for the company, because that is what allows us to reinvest in our platform and grow our business sustainably,” said Dickerson. “We believe that Etsy can be a model for other public companies by operating a values-driven and human-centered business while benefiting people.”.
For technology companies, incorporating values into the business model has become quite common: Google started out with its “Don’t be evil” mandate, and Facebook’s Little Red Book makes it clear: “Facebook was not originally created to be a company. It was built to accomplish a social mission – to make the world more open and connected.”.
The idea that corporations would benefit from spelling out their values was cemented after the financial crisis: “What happened primarily around 2008 was CEOs were being vilified,” David Yoffie, professor at Harvard Business School, told ‘FastCompany’. “Just being a CEO meant that you were often considered to be evil [and] the public perception of CEOs had swung so far to one side that it stimulated at least a set of very socially conscious CEOs to say, ‘We need to correct the balance.’“.
Promoting yourself as a company with values became a way to regain trust. Going about your business wasn’t enough anymore – people now wanted to see things like social outreach programmes, environmentally friendly policies, consideration of gender and ethnicity in hiring – all of which point to concern not just for your staff but also an awareness of the company’s role in society as a whole.
Studies show that especially the younger generations are vigilant when it comes to companies being socially responsible. Generation Z, who’re currently 12 to 19 years old, want to give their custom to companies who use their position to do good. Conscious of how negative publicity can damage their brand, corporations are becoming increasingly quick to respond to public pressure. For example, last year John Lewis stopped stocking SodaStream in their department stores following public pressure protesting the company’s factories on the occupied West Bank. A values-led approach to business is becoming increasingly mandatory now that people are more ready than ever to vote with their feet.
Register a .social domain name from UK2 and showcase your social values within your website.