Reconciling Business and a Positive Impact: It's Possible

15 FEBRUARY 2021

Creating a business which respects environmental standards and people’s needs: it’s possible. Indeed, it’s the future of business. Read on to find out Alain Fargeon’s views: he is the head of Jon Spakers and is the course leader of the “Bringing business and positive impact together” Certificate, part of the Executive MBA at emlyon business school.

In terms of business, what is a positive impact?

Alain Fargeon: it’s all about creating a business which respects environmental standards and the needs of people, the natural world and the planet. It’s not just a question of limiting a negative impact or compensating for it. It’s about maximising a positive impact with a business which serves the common interest and the common good, all whilst being profitable.

Why should companies focus on this positive impact?

We’re facing many challenges: protecting the environment, climate change which will lead to migration crises, inclusivity, respect for biodiversity and more. All these changes have an impact on people and, in the end, on the economy. Regulations will be tightened, markets will be disrupted and companies which have not thought about these issues before will be called into question. Tomorrow, a company’s value will be measured by its positive impact. Some investors already use these indicators as a basis for their choices. This is an opportunity to be seized. We talk about the regenerative economy. It’s good if a company wants to limit its negative impact, but it’s already lagging seriously behind.

This will entail a change of business model for some; how can they make that change?

Absolutely, they will have to challenge their business model to do things differently. The difficulty for many SMEs lies in taking a step back and finding the time and the resources to explore this, all whilst protecting their business. You have to challenge your relationship with time, think ahead to the future and ensure that you have resources to explore and the right to fail. Some companies have become aware of the need to do this but don’t know where to start. Others are still sceptical. Sustainability and positive impact are the result of a personal journey.

The anxiety-inducing discourse around this subject at the moment doesn’t always inspire you to take the first step...

It’s true that catastrophic messages don’t encourage action. It’s better to focus on inspiring approaches, positive initiatives which are creating a real shift. And there are plenty! They show that it’s possible and, most importantly, that these approaches can be replicated.

Can you tell us about some of them?

The insurer MAIF encourages the use of recycled car parts, for example. Policyholders can have their cars repaired with recycled car parts from a network of approved recyclers. Individuals save money and a virtuous industry is created to recycle cars. This avoids the overproduction of parts when scrapyards are full of items which can still be used. The business model is gradually challenged.

Is it easier to integrate a positive impact from the very beginning of a company’s existence?

Yes and many start-ups take their impact into account when they launch. I work with a start-up which makes comfortable clothing for people undergoing chemotherapy. Since it was founded, the company has focused on the circular economy so that it can reuse clothing for a second or even a third time. This means providing a different service and a different customer experience for the duration of treatment. It’s particularly interesting because regulations in these areas are already being put in place. In the long term, the law against waste and the circular economy will require this type of approach.

Is the “purposeful company” model an encouraging sign?

Of course, it’s a step in the right direction like CSR. This model makes it possible to write and monitor a company’s objectives, with a committee which checks that the company’s purpose is well defined. But I don’t think it’s indispensable. You don’t have to be a “purposeful company” to be mindful of your impact and to decide to focus on the common good.

Who should embody this change within companies?

We all have a responsibility. Executives, managers, investors, customers, employees... Through the “Bringing business and positive impact together” Certificate at emlyon business school, we help to encourage this new mindset among tomorrow’s managers. They can then make their staff and their management aware of these issues and show them that yes, it is possible. They can also help to explain the issues at stake. Tomorrow’s leaders must be the driving force behind this ever-changing world. Avoid waiting and seeing. Nothing magical will happen.

How is the teaching for this Certificate organised?

We raise awareness among the participants so that they can acknowledge and rethink their relationship with the natural world and other people. We help them to identify and to analyse impact models, to connect with the living world and to take a regenerative approach to the economy, society and the planet. A hackathon is also organised in partnership with several NGOs and charities about the challenges facing us as a society (climate, biodiversity, migration crisis, regenerative economic models, inclusivity, etc.). They learn about awareness-raising approaches through solutions like journalism, the ability to imagine desirable futures with design fiction, human-centred innovation approaches with design thinking and more. In this way, they develop their quotients for empathising, systemising and ethics.

It’s a new way of looking at the world and they become drivers of change who will inspire action with real impact.