Doing Well by Doing Good
There exists a commonly held conception that compassion and empathy are at odds with indicators of financial success, and this is a notion that we need to work hard to combat because it is simply not accurate. Doing well by doing good is not only feasible, it is probable both in business and in life. Acting in an ethical manner makes for sound, long-term productivity and reliability, and these translate into growth in profitability and market share. This is a concept I address in the first chapter of my book–structure is imperative, and being ethical and heartfelt are fundamental to creating reliable, effective structure.
Because I operate in this manner, it was no surprise to me to learn about the benefits of being mindful of environmental, social and governance (ESG) factors in investing; think of factors relating to how corporations treat their workers, build trust and foster innovation, respond to climate change, and manage their supply chains. According to the UN document Who Cares Wins (backed by prominent investment firms worldwide including Credit Suisse and Morgan Stanley), “Companies that perform better with regard to these issues can increase shareholder value by, for example, properly managing risks, anticipating regulatory action or accessing new markets.” Additionally, according to Forbes contributor and investment professional Georg Kell, not only is “good corporate sustainability performance associated with good financial results,” but also “in many important markets, including the U.S. and the EU, ESG integration is increasingly seen as part of fiduciary duty.“
The bottom line is that approaching leadership, business, life, and even investing with a compassionate philosophy isn’t just the right thing to do. Done correctly and intelligently, it’s also the more beneficial, effective and profitable route to success.
