Vantage Points – The Unstoppable B Corp Movement
The Unstoppable B Corp Movement – 11th February 2022
‘Business should be used as a force for good.’ That is the mission statement of B Labs, a non-profit network headquartered in a quiet suburb of Philadelphia which is slowly changing the world for the better – one company at a time.
A year ago I decided to take Oakham Wealth on a journey to become a B Corp, and I’m proud to say that as of January we are now one of just 600 B Corp companies in Britain and around 4,500 worldwide to enjoy this coveted status.
Being a B Corp means your firm has met a dizzying range of exacting standards across metrics covering social governance – we were required, for instance, to change our articles at Companies’ House – as well as the stipulations concerning the environmental impact of your operations and business. In our case, as a wealth manager, that includes interrogating our investment funds to see if they align with socially and environmentally sustainable good practice.
While I’m proud to shout about joining the B Corp gang, obtaining B Corp status really mustn’t be about virtue signalling. Nor should it be a cynical attempt to jump on a trendy corporate bandwagon. It’s about a belief that to succeed in business today you need to be creating success that is shared with all your stakeholders – and not simply your shareholders, important though they remain.
Soon after I became CEO of Oakham Wealth, I realised that in order to get the best from our talented people, a new approach to management was required. The old command and control method of management is history. Today, the best leaders adopt a more conversational method so that leadership comes through influence and by dialogue. This makes business a more creative and collaborative shared exercise. Not for nothing are the best leaders of today also the best listeners.
But this very open form of leadership, critical though it is, isn’t enough on its own. It needs to be supported by a values architecture that everyone can buy into – and either benefit from or see the benefit from. That requires having a business model and strategy that not only deliver for customers and shareholders but also serve the wider interest of society and the environment.
So, from a certain perspective, what I’m talking about is just basic strategic sustainability – yet it’s one that also considers the needs of recruitment and talent management, customer service and investor relations. It also factors in the needs of the planet and society at large.
When it comes to a wealth manager like us, I believe that this values-led approach is especially important. Our job is to preserve and grow the wealth of our clients, but if we can help make the world a better place through that, then that’s very motivating for everyone concerned – from staff to customers and shareholders. Moreover, it’s just good business: how can it make sense to grow your clients’ wealth one year through unsustainable investments that will likely make them poorer a few years down the line?
It just so happens that the values-led, leadership-by-management approach that I had been interested in happens to align very closely with B Corp principles. These principles place an emphasis on accountability and transparency throughout your business, in addition to your firm’s social and environmental performance.
This meant that for me, when I was looking at how to enhance and change Oakham Wealth for the better, the B Corp route provided a structure – with guidance and mentorship along the way – that was highly attractive. This was a blueprint for us to become a more sustainable operation.
It’s not been without its challenges, of course. Understandably I’ve had some pushback. Some stakeholders were highly sceptical that it was little more than just woke virtue signalling.
But there really is a lot more to it, and I’m sure that in five years’ time it’ll be par for the course.
Already it has become common for companies to define their corporate purpose, something that goes well beyond the pursuit of profit. Usually, it’s a purpose that binds them to the world around them – their workers, suppliers and customers included – and it goes to the heart of their strategies. In other words, it’s not an overlay, it’s part of the mission.
Getting this right within your own organisation is no easy task, especially if you’ve been wedded to the old ways.
The non-profit organisation which anoints new B Corps has bold ambitions to change the world’s economic system. It all sounds a bit dramatic but then you realise it’s not. ‘We are shifting our global economy from a system that profits few to one that benefits all,’ declares the organisation, ‘advancing a new model that moves from concentrating wealth and power to ensuring equity, from extraction to generation, and from prioritizing individualism to embracing interdependence.’
I told you it sounded radical. But it isn’t. Not really. And, increasingly, I feel that more people in business than ever would struggle to disagree with it. Take a look at the handful of other B Corps within the wealth management sector – the Queen’s bank, Coutts, is a B Corp, and so is the wealth manager MASECO, hardly a hotbed of radicalism. (And then there’s the sustainable investment specialist, Tribe.)
So that’s why I’m especially proud that Oakham Wealth has been designated a B Corp. It’s also why I think it’s safe to predict that there’ll be a lot more B Corps five years from now.
The world has come a long way since the 1970s when the economist Milton Freidman put the obligation to shareholders above everything else in business. The Gordon Gekko creed of ‘greed is good’ that followed it has rightly been decried and rejected, most convincingly in the aftermath of the global financial crisis of 2008. The B Corp movement is the next step in the right direction for capitalism. Making money well is the future. It’s certainly what we believe at Oakham Wealth. You can find out more here www.bcorporationuk