Why capitalism will save us

By Nik Govier, Founder and CEO

Times are tough.  No doubt. We’ve faced a crisis that none saw coming and are in a recession that could bite like no other.  

So, does this mean the end of purpose, as brands fight for the pennies of their hard-up customers? 

No.  An emphatic no.  But why?  

Within the recent stock market turmoil, shares of companies focused on ESG (Environmental, Social, Governance) issues have outperformed the rest.  

Being a better business makes businesses more bullet proof (that’s a bit of a tongue twister).    

But it goes beyond that. Institutional investors – like BlackRock – are continuing to demand better ESG standards at a time when business has a constant need for access to debt and capital on cost-effective terms. 

Better human rights, better supply chain, better environmental standards.  Without it, they can’t access the funds the capital markets rely on.  

The pressure’s not just coming from the markets. Those that buy the products will continue to demand more.  Just look at the backlash around #BlackLivesMatter, when brands that lamely supported the cause got ripped down when it was clear they didn’t back their chat with their own diversity credentials.  

The same will happen with every major cause as people face the hardship of a recession which will inevitably inflame deeply felt pain and fear.  

And that’s why capitalism will save us.  Because the corporates won’t get the institutional cash unless they behave better, and their customers and employees will boycott, call out and generally raise hell if they dare to preach without the practice.  

So, to those that say purpose is dead. We say, it’s the only thing that will keep us alive.