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14 July, 2016

Socially conscious enterprise makes sound business sense

Tony BradleyTony Bradley (left), Director of the Social and Ethical Enterprise Development Centre at Liverpool Hope University, and Naomie Lucas, founder and CEO of Southern Wicked Beverages LLC, kicked off the first full day of the Trust and Integrity in the Global Economy (TIGE) 2016 Conference on 6 July with a plenary on Economy for the Common Good. It covered issues ranging from building local economies of solidarity to facing the challenge of running businesses that are both socially responsible and financially sustainable.

The speakers shared their stories of entrepreneurship and backed up their arguments for a global economy based embedding social responsibility into business strategy with a host of studies demonstrating that this need not cost a business, and may indeed lead to financial gain, as well as contributing to the common good.

TIGE participantHighlighting the disenchantment and polarisation present in developed economies today, Bradley urged participants to recognise that what manifests itself as scepticism is in fact a symptom of a ‘deeper malaise’, grounded in a lack of trust and integrity on a global scale.

The solution? There are two options, says Bradley. The first is to increase consumption in undeveloped countries to reach a situation of distributive equality. However, this was ‘like trying to dampen down a fire by pouring petrol on it.’ The second? Encourage local, green, solidarity-based, resilient economies, providing ‘beautifully small answers to ugly global situations’. These could be implemented in myriad ways: networking hubs for social enterprises; encouraging existing green businesses to expand; radical political movements; and releasing creative energy in disadvantaged communities are just a few possibilities.

Naomi LucasNoamie Lucas (left) recounted the story of her business venture which has already heeded the call for a reconnection between business and society. As the leader of the first minority-owned and female majority-owned moonshine distillery in the US, she has already gained considerable backing for her business. Deeply affected by her religious beliefs and the inspiration of her grandparents, Lucas illuminated the importance of leading a life that was wealthy not in material terms but in spiritual ones: ‘If we measured Forbes 500 by spiritual wealth,’ she said, ‘my grandparents would have been among the 40 richest people in the world.’

Lucas is a passionate believer in the notion that integrating social responsibility into your business isn’t just the right thing to do: it’s profitable too. Sources from the Harvard Business Review, Forbes Magazine and others have demonstrated that companies which encourage their employees to volunteer and pledge a portion of their profits to charity consistently yield higher profit margins and retention rates. Additionally, CEOs whose employees gave them high marks for character had an average return rate on assets of 9.23 per cent over two years, outperforming those with lower character ratings by five per cent.

How can this be done? Lucas outlined four moral principles which form the basis of a socially responsible business: integrity, responsibility, forgiveness and compassion. She practices what she preaches in the way that Southern Wicked Beverages is run. The ingredients are sourced from local farmers, and 10 per cent of net profits are reinvested in the communities where products are sold.

By Victoria Waldersee

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