Spring semester of my sophomore at USC, I took a class called, “Venture Investing for Impact.” On the first day I expected to begin learning how to execute lucrative venture investments; however, I was pleasantly surprised to discover I had misunderstood the focus of the course. Over the next fifteen weeks our professor, Fran Seegull, opened my eyes to the exciting world of impact-investing.
My plan is to briefly describe my definition of impact, detail an exciting trend taking place in corporations across the globe, and discuss how these developments are relevant to my world.
“Impact” in the sense of business philosophy is a commitment by firms or organizations to achieve objectives beyond pure financial gains. There are hundreds of ways to measure impact, making it difficult to judge and compare firms on an absolute basis. Impact can range from dedicated social ventures to more blended value operations that consider financial and social metrics together.
There is an exciting trend taking place in the corporate world. For years attention has grown in the arena of impact-focused ventures. At the same time, millennials, in particular, have shown a strong interest in aligning their career and personal choices with impact-oriented objectives.[i] The 2015 Deloitte Millennial survey found that 75% of millennials feel that businesses are too focused on their own agenda, rather than considering social welfare and the objectives of their employees.[ii] Despite these statistics, it is safe to assume not all millennials are going to work in strictly impact-focused professions. With that in mind, basic economic theory would tell us that in order to continue retaining top millennial talent, companies will have to incorporate more impact objectives into their operations.
Corporate impact is a game-changer. When companies generating billions in revenue each year dedicate themselves to achieving impactful returns, everyone benefits. This commitment is abundantly evident in the tech universe. A few of the companies that reflect this philosophy are:
- Salesforce: Has committed to a “1-1-1 Model,” whereby employees devote 1% of their important resources (product, time, and expertise) to philanthropic endeavors. The program has netted more than $100M + in grants, 1.1M hours of community service, and product donations to more than 27,000 charities.[iii]
- Apple and Google: Both tech titans sponsor employee gift matching programs that have generated more than $60M in charitable donations in the past three years – redefining the meaning of “corporate philanthropy.”[iv]
- Dropbox: Runs a “Hack Week” each year that encourages employees to think creatively about issues confronting society and problem-solve using their professional expertise.[v]
I accept that it is one thing to throw money at charities under the guise of social benevolence and quite another to dedicate the time and effort required to promote change. It is true that as there becomes a monetary incentive to support “social awareness,” corporations will look for ways to demonstrate impact even when their operations may be on balance socially destructive (see negative externalities). Notwithstanding these developments, on balance the integration of social awareness into corporate philosophies, whether taken by philanthropic or capitalistic motivations, is having significant impact in society.
I want to work at a company where I can see the impact of my accomplishments is financial accretive and altruistically colored. I am not naïve. I know every company will not “change the world,” as is so often promised. Yet, I am optimistic that I can find a position where my assets and motivations can be put to impactful use. Such a scenario will see me reach my greatest professional potential.
P.S.: Speaking of “Impact-Focused” ventures, check out the Kickstarter page for Fair Harbor Clothing – a bold new approach to creating sustainable lifestyle apparel. Contribute to help them blow past their fundraising goal! Props to Jake, Caroline, and Sam of the Fair Harbor team.
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