Conscious Businesses are firms that recognise that there are more stakeholders in a company’s actions than merely the firm and the consumer and which attempt to benefit society and the environment in addition to maximising profits for their shareholders. The concept originates with corporate social responsibility, or CSR. CSR is a form of self-regulation by firms attempting to comply not just with what is legally required of them but also with ethical norms and moral values. Conscious business takes that concept and elevates it by adding an increased layer of self-scrutiny and looking at the bigger picture. A firm engaging in CSR might invest in local community programs but still underpay workers, whereas a conscious business will attempt to ensure that the existence of the company as a whole is a net benefit to society.
What do Conscious Businesses look like?
You have probably heard of the phrase the bottom line, meaning the last line on an accounting sheet, showing profits. Increasing profits is of course the driving goal of most companies and there is nothing wrong with this; not all profitable firms are evil. However pursuing profits endlessly can be detrimental to society, which is why Conscious Businesses subscribe to what is known as the Triple Bottom Line model for measuring success. They aim to be “in the black”, or have a positive value, in three fields: Profits is still one, but so are people and the planet.
The pursuit of profits is what distinguishes a Conscious Business from another charitable enterprise. These are still businesses at heart, they still recognize money as an important objective. That being said, there is huge variety in Conscious Businesses regarding the degree to which profits are important. Some firms attempt to maximize their benefit to society while simply breaking even on profits, while, on the opposite end of the spectrum, some firms attempt to maximize profits as normal while simply ensuring they break even on their net contribution to society (don’t be evil).
Then there is the aim of benefiting people. This of course means fair pay, job security and a healthy working environment for employees, but it also means anything that benefits larger communities, not just firm employees. Both large scale attempts to improve society, including the use of fair trade materials and increased scrutiny of partners at different points of the supply chain, as well as more targeted programs for direct investment into community outreach have become popular trends among socially conscious firms.
Finally there is the planet. Socially conscious businesses attempt to limit their negative impact on the environment just as much as they attempt to minimise their impact on people, as, after all, a healthy planet is vital to the people of tomorrow. Fortunately, in recent years, environmental responsibility has become not just socially responsible but also much more profitable, as people have become more aware of the damage firms are doing to the planet and therefore responsible firms have been able to use their green thumb as a selling point. Popular trends these days include recycling programs, the usage of renewable energy and a major push towards more sustainable environmental practices in packaging, including huge reductions in the amount of packaging firms use and a shift away from plastics.
Where does Conscious Business stem from?
Anita Roddick is widely credited as founding the movement in 1976 when she started her cosmetics company The Body Shop, whose first shop used natural ingredients and helped to train immigrant women, and which has promoted its business through social and environmental campaigns since the 1980s.
These days however, conscious business can be found in almost all industries, thanks largely to increased consumer awareness of the products they consume. Some famous modern day examples include Whole Foods, which donates 5% of annual profits to charities, is ranked 3rd by the U.S. Environmental Protection Agency’s list of green companies and was the first supermarket to eliminate its use of disposable plastic bags in 2008, or Toms Shoes, a shoe company which has famously branded itself on donating one pair of shoes to an impoverished child for every pair of shoes they sell.
Young writer. Studying a Economics degree starting Spring. Passionate about finance and financial trends. Currently interning at Ztudium and intelligenthq.