The rules for business are changing rapidly. Leading any organization today is more complex and uncertain than ever. Corporate managers are increasingly asked to do more than deliver financial results or quality goods and services; they are being tasked with tackling massive environmental and societal challenges, operationalizing purpose, and meeting the demands of multiple stakeholders, while navigating an environment of rapid change.
More and more, we are seeing individuals, businesses, and governments calling on each other to make commitments that deliver on real change to create the more just and equitable future that we all envision. We see these calls to action manifest in multiple frameworks and visions, like the UN’s Sustainable Development Goals, the Business Roundtable’s commitment to stakeholder capitalism, and most recently, the World Economic Forum’s Davos Manifesto 2020 on the universal purpose of a company.
One context in which all these demands converge in a monumental way is corporate value chains. From rising inequality to climate change, corporate value chains generate much of the negative social and environmental impacts we face, causing a growing systemic risk to people and the planet.
Global companies (as well as governments, NGOs, IOs and other entities) have a tremendous opportunity to harness their trillions of dollars in purchasing power to amplify the benefits and reduce unintended negative impacts generated throughout their value chains. By augmenting their procurement strategy to help transform the purpose, structure, and practices of the businesses they buy from, they can deliver on the growing imperative for stakeholder capitalism and the SDGs, while continuing to meet the demands of their shareholders.
A Way Forward
A group of leading corporations, networks, NGOs, governments, and institutions are coming together to launch the Buy For-Benefit Coalition, a systemic intervention to support and scale the transition to purpose-driven value chains and unlock trillions in for-benefit procurement preference.
By joining the Buy For-Benefit Coalition, organizations can take a large step toward operationalizing purpose, cleaning up harmful supply chain practices, advancing the 2030 Agenda, and creating benefit for all stakeholders, while providing satisfying long-term profits and viability to shareholders. To help ensure success, Coalition members have access to a collaborative, cross-sector platform for sharing knowledge and best practices, a global community of practice to co-create solutions, access to tools and resources, and a testing ground to pilot efforts and join forces with leading organizations and stakeholders to drive results. Through their participation in the Buy For-Benefit Coalition, members will be empowered to deliver significant impacts on multiple levels.
The Fourth Sector Group and SYSTEMIQ, working in partnership with the World Economic Forum (WEF), International Chamber of Commerce (ICC), and CARE, and with support from the UK’s Department for International Development (DFID), are delighted to announce the launch of the Buy For-Benefit Coalition at the World Economic Forum 2020 Annual Meeting in Davos, Switzerland.
Leveraging a Growing Sector
Fueled by significant and growing demand among consumers, workers, investors, entrepreneurs and other stakeholders for values- and purpose-driven business, for-benefit companies represent an untapped opportunity for addressing many intractable challenges in global value chains. They constitute an emerging fourth sector of the economy, which could account for as much as 10% of GDP as well as nearly twice the job growth rate as traditional for-profit businesses in the US and Europe. Globally, many traditional businesses and NGOs have adopted for-benefit approaches, and there are millions of for-benefit start-ups being launched each year.
For-benefits are businesses defined by their intention to generate one or more social or environmental benefits as their primary purpose. Purpose is at the heart of the for-benefit model, and it is supported and reinforced by their structure. They can pursue a wide variety of social and environmental goals, like equal pay and gender equality, the inclusion of marginalized populations in the workforce, a priority to address relevant needs of society, and a focus on demonstrating care for the planet's resources and the environment at scale, in a sustainable manner.
For-benefit organizations complement other models and extend their capacities to drive positive change. For traditional businesses, the growth of the for-benefit sector will bring access to expanded markets, new customers, and business and investment opportunities. It will enhance stakeholder engagement, improve productivity, and strengthen supply chains. For nonprofits, it will bring new contracting and partnership opportunities, increased philanthropic resources, and the opportunity to build self-sustaining, scalable solutions. And for governments, its growth will bring increased revenue and greater private investment, and it will stimulate job creation and economic growth while reducing the liabilities linked to social and environmental degradation.
About the Buy For-Benefit Coalition
During the World Economic Forum’s 2019 Annual Meeting in Davos, Switzerland, leaders gathered to kick off a year of consultations aimed at building a cross-sector alliance of pioneering organizations committed to shifting $100+ billion in corporate procurement preferences towards inclusive, sustainable for-benefit businesses.
Over the past year, the Buy For-Benefit Coalition has rapidly become a growing community of collaborators from business, government, civil society academia, advisory firms, standards setting bodies, financial institutions, and business networks.
During this development phase of the Coalition, partners have been collaborating to develop tools, know-how and mechanisms required to make the vision of for-benefit value chains actionable.
The Coalition is a collaborative global platform offering a roadmap, tools, support, and other resources to assist and guide organizations along their journey to transition their value chains from traditional, profit-centered business models to more purpose-driven, for-benefit alternatives.
Our mission is to advance more inclusive, resilient, and sustainable economies by putting purpose in global value chains. We envision a world where businesses, which hold trillions of dollars in purchasing power, deliberately choose to partner with for-benefit enterprises across their value chains. This commitment to a for-benefit procurement preference is a tangible and catalytic way for organizations to demonstrate purpose, benefit all their stakeholders, and become a steward of real sustainable development.
Coordination, and Cooperation
Members and Partners collaborate and reinforce each other’s activities and impact:
Companies, governments, NGOs, IOs, and other purchasers commit to implementing a for-benefit procurement preference;
NGOs and civil society organizations offer validation of approaches and guard the integrity of the Coalition;
Governments support the work by creating enabling laws and regulations;
Asset owners, banks and financial institutions provide investment and support to for-benefit companies; and
Academic institutions and advisory firms contribute to the development and implementation of tools and know-how.
Thank You to Our Partners
We are extremely grateful to the following allies who informed, contributed, designed, and co-created the Coalition over the past year:
Accenture, BMW, British Academy’s Future of the Corporation programme, Edelman, Goal 17 Partners, Google Food Labs, Hershey’s, McKinsey & Co., o9 Solutions, Philips, Rockefeller Foundation, Salesforce, SAP, Unilever, Verizon, KPMG, Thompson Reuters Foundation, TU/e.
Benefits and Impacts of Joining
Stakeholders all over the world are asking for organizations to demonstrate their purpose while companies and governments are working on ways in which to deliver on those expectations.
By joining the Buy For-Benefit Coalition, organizations can take a large step toward operationalizing purpose, cleaning up harmful supply chain practices, advancing the 2030 Agenda, and creating benefit for all stakeholders, while providing satisfying long-term profits and viability to shareholders.
Access to tools, platform, training, and other resources.
To help ensure success, Coalition members have access to a collaborative, cross-sector platform for sharing knowledge and best practices, a global community of practice to co-create with, access to tools and resources, and a testing ground to pilot efforts and join forces with leading organizations and stakeholders to drive results.
Through their participation in the Buy For-Benefit Coalition, members will be empowered to deliver significant impacts on multiple levels:
Deliver tangible impact on organizational sustainability agendas by promoting diversity and resilience in global value chains, while reducing risk posed by supplier malpractice
Increase corporate reputation, profits, and employee welfare by meeting stakeholders’ expectations on sustainability and building trust and loyalty with customers, investors, employees, and society at large
Gain access to new markets while helping to build the supportive ecosystem and meeting new policy and regulatory requirements
Contribute to the wellbeing of society while advancing stable economies and healthy communities
Tackle environmental challenges, such as carbon emissions and deforestation, and reduce overconsumption of finite natural and other finite resources
Address social inequities, such as forced labor and pay inequality, and create new employment opportunities for people of diverse origins and backgrounds
Accelerate the development of the enabling environment for purpose-driven, for-benefit business models through access to capital, policy reforms, capacity building, and more
Create sustainable economic development opportunities for businesses, policymakers, investors, technical service providers, and other key players in the ecosystem
Drive solutions and systemic progress on the SDGs and achieve the promise of stakeholder capitalism