This approach has resulted in an influx of actions and projects that are driving a measurable positive impact on society!
One such startup is Beyond Meat, which has created a plant-based replacement for meat that is not only healthier for us humans but also has a lower environmental impact. By reducing the adoption of meat, Beyond Meat requires much less water, energy, and land to produce their food, reducing the overall greenhouse gas emissions associated with production.
And there’s more to that! Beyond Meat is part of a larger trend of companies focusing on finding answers to society’s most urgent issues. The company is making it easier for us to adopt a more sustainable diet while still enjoying the flavors and textures of our favorite meals. Just because it’s plant-based doesn’t mean it cannot have the same taste or nutrients! This strategy benefits not only the environment but also public health, as plant-based diets are synonymous with reduced rates of chronic illnesses, including heart disease and diabetes. Still not convinced that Beyond Meat’s strategy works? Well, according to a recent survey conducted by Wakefield Research, millennials are the generation most likely to have explored plant-based alternatives, with 81% of respondents having done so.
Another startup that is renowned for its social influence is TOMS Shoes. They have significantly altered the game by developing a business model that goes beyond profit maximization and instead focuses on giving back to society. Why, you may wonder? Well, they have implemented an initiative that has resulted in changing the lives of millions of children globally by donating a pair of shoes for each pair sold. Even more so, their contribution to funding clean water projects and eye care services has also been part of their socially responsible portfolio.
But there’s a catch here. And you must understand that you should never try to overdo it. And TOMS felt this on their own skin. After you’ve read the above information, you probably wondered, “What will happen if they’re no longer be capable of delivering a pair of shoes for every pair sold?”. And that’s exactly what happened, unfortunately. In 2021, the company announced that it would stop its “one for one” campaign and would focus on donating a third of its annual profits to local charities and community-focused organizations.
And that’s not all! More and more startups have already integrated into their CSR (corporate social responsibility) strategy initiatives related to diversity and inclusion, including programs to support women and promote LGBTQ+ rights. Even more so, Airbnb, Salesforce, Ben & Jerry’s – they’re all companies that have publicly acknowledged their power in our society and have decided to take matters into their own hands in combating the fight against homophobia, sexism, racism, and other injustices.
Being socially and environmentally concerned is clearly no longer optional anymore.
It’s 2023 – it’s undeniable that there has been a growing number of startups that are motivated by their ethical commitment. And the more we pay attention to these businesses, the more they will continue to challenge traditional corporate thinking.
Why, you may wonder? The answer is simple: startups are able to accomplish objectives that larger corporations can’t. Being young and driven by change and responsibility in society, they possess a level of flexibility and adaptability that multinational companies often lack due to bureaucracy and other barriers. These qualities enable startups to accelerate the progress toward creating a more sustainable and equitable future – whether it is through their products or their actions influencing society.
And to debunk the myths around such startups – being socially responsible is not mutually exclusive with sacrificing profits!
On the contrary! They can be just as profitable. Actually, in many cases, they can be even more so than traditional startups. And that’s mostly because customers are increasingly searching for startups that match their mentality and overview of the world. Even more so, even investors are beginning to acknowledge the value of socially and environmentally conscious startups. That’s true! According to McKinsey, from 2019 to the end of 2022, more than 330 sustainability, ESG, and impact funds were created, with cumulative assets under management in these funds increasing three times, from $90 billion to more than $270 billion.
So, contrary to everyone’s beliefs, businesses focused on impact-driven initiatives hold a significant competitive advantage in the marketplace. However, this differentiative aspect should not be the primary purpose for entrepreneurs to implement such actions. Instead, it should be because we acknowledge the unprecedented challenges we are currently confronted with – from climate change to the refugee crisis and a global rise in inequality. And remember - even though people appreciate a company that is socially responsible - if you can’t do it because your finances don’t allow it - don’t sweat it - at least do everything you can to show that your business believes in these initiatives. And remember - bringing awareness to these issues can be an alternative!
One thing’s certain - the era of socially responsible startups has already begun!
