When it comes to embracing an impact business model, there are many questions that come to light. One of the biggest questions I get asked is how do I balance my purpose with profit?
Hi I’m Catherine Rocheleau, CEO & Founder of Ignite Leadership International, host of the Purpose-Driven Leadership Summit, and creator of the IMPACT Business Blueprint course.
Contrary to popular belief purpose and profit are not like oil and water. In fact, they are intricately linked.
In the Harvard Law School Forum on Corporate Governance on Purpose and Profit, the authors stated …
“Profits are in no way inconsistent with purpose—in fact, profits and purpose are inextricably linked. Profits are essential if a company is to effectively serve all of its stakeholders over time—not only shareholders, but also employees, customers, and communities. Similarly, when a company truly understands and expresses its purpose, it functions with the focus and strategic discipline that drive long-term profitability.”
I think of profits as the fuel for your bus that allows your stakeholders to travel with you, and purpose as your path – your vision.
If you run a for-profit business and want to use your business to create a positive impact in the world, you have the ability to re-allocate your profits to social/environmental impact initiatives. Although I have led non-profits both as an executive director and in a leadership capacity on the Board, I recognize my expertise is best suited to my “for-profit” endeavours. I volunteer, mentor, and donate to non-profits who are better at delivering the change I want to support.
However, non-profits are also businesses based on a strong mission or purpose. As a non-profit leader, you most likely have a fund-raising plan to attract the money needed to drive your organization and deliver on your mission and purpose.
Funding, revenues, profits, capacity building are synonymous with the linking of purpose and financial status.
In order for business or non-profit leaders make a difference in the world I believe we have to shift our money mindset to one that reflects a positive relationship with a strong purpose reflected by our actions and how we back it up with adequate funding to make it happen.
I’d love to have you join me in the conversation on creating positive change through business. I invite you to subscribe so you won’t miss future episodes.