Why purpose = profit

A few weeks ago an article in FT Weekend by Judith Evans caught my eye. It described how Unilever’s CEO Alan Jope recently declared ‘brand purpose’ would be the key to underpinning the future fortunes of the 100 year old group of companies.

Jope’s statement that ‘our first priority is to help our brands find their purpose’ alongside his recently acquired mantra that ‘brands sell better if they are purpose led’ is a clear indication of how larger corporates are focusing increasingly on sustainability in order to benefit shareholders. The changes in fortune and huge uplift in sales of one of Unilever’s oldest brands ‘Lifebuoy’ during the pandemic, was cited as the reason behind his new mantra.

For a company of any size this is a delicate balancing act, even at the best of times, and when he announced its new strategy last week, Unilever shares fell almost immediately to a nine month low point. Despite this, according to Joe at least, the wish of most shareholders is to ensure the business is managed for long-term health and prosperity rather than short-term financial gain.

Jope’s self-confessed goal of proving sustainable business drives superior financial performance has some precedence, their brands providing clear social or environmental benefits are growing revenues twice as fast as other brands in the Unilever stable.

In our view core purpose has always been at the heart of every successful organisation, whether you’re a global player, a niche artisan brand or a start-up. But sometimes for huge corporations it takes a pandemic to recognise that purpose before profit could be a lifesaver.