Until now, as long as companies delivered on shareholder value, investment and growth generally continued every quarter. The peak of the economic crisis in 2008, however, accelerated a nascent trend and emphasized a shift from shareholder to stakeholder value.
After three years of research with more than 6,000 people, I have heard the call for brands to do good on their behalf growing below the surface of all their decisions. Here is a 5-step model of brand citizenship all CEOs can use that embraces both profitability and responsibility as harmonious concepts.
Placing a greater purpose at the center of a brand is the starting point, followed by aligning the benefits a brand delivers to individual customers with how it treats employees, suppliers and the environment, and with the way it helps the world. The 5 steps logically flow from one to another.
The 5-step model of brand citizenship
Trust: Don’t let me down. First and foremost, brands that deliver on their promises are trusted more. Digital communications and information channels have made reciprocity one of 5 key requirements for trusted brands.
“Today, the goal of doing good and becoming a sustainable business is a practical and necessary investment into brand loyalty. This is the new model of Brand Citizenship.”
Enrichment: Enhance daily life. People identify more with—and are less price sensitive toward—brands that help them simplify their routines, make mundane tasks less dull, and enrich their daily lives.
Responsibility: Behave fairly. In a post-recession, flattened and transparent world, customers expect brands to treat their employees fairly, behave ethically, and be proactive in their business practices.
Community: Connect me. Brands that rally communities, motivate behavioral changes and fix social problems – provided they are not overtly political – attract more loyalists.
Contribution: Make me bigger than I am. Brands that play an active role in creating a more positive and life-enhancing future enrich loyalists’ lives by improving life on the planet.
Doing good and making a profit
The phrase ‘doing good’ conjures up images of idealism and altruism—which translates to self-sacrifice and not making a profit. Yet globalized sourcing, production and sales all insist that long-term success be dependent on meeting the needs of a wide range of stakeholders. In an interconnected world where mashups of all kinds are mainstream concepts and where social media enables people to share stories globally of good and bad experiences with products and services, the notions of doing good and earning a profit cease to be at odds with each other.
Today, the goal of doing good and becoming a sustainable business is a practical and necessary investment into brand loyalty. This is the new model of Brand Citizenship: a holistic principle that equips businesses to gain lasting credit for sustainability and corporate social responsibility initiatives along a continuum of doing what you say you will, doing right by employees and the planet, and providing goods and services truly worthy of the buying public’s time and hard-earned dollars.