“I think everyone when they’re young goes, ‘Why the hell are we doing it this way?’ That’s a great question, and Millennials ask it really eloquently – we should have an answer, or abandon our old ways of doing things.” – Helen Souness, Etsy managing director for Australia and Asia.
When those old ways are destructive, unsustainable or unethical then all the more reason to abandon them. Fast.
We all know the stereotype of lazy, narcissistic and entitled Millennials surgically attached to their iPhones. If you don’t then perhaps check out Saturday Night Live’s parody of a TV office drama, featuring a bonus cameo from Miley Cyrus.
The problem is, like most stereotypes, this view of Millennials prevents us from seeing more fundamental truths about a generation that is stepping up to create a more sustainable model of work and business.
At the Plato Project, a new business school focused on purpose-driven business, entrepreneurship and mindful leadership, we recently ran a panel event asking whether purpose and profit can coexist. To clarify, for us a purpose-driven business is one that has an objective aside from purely financial outcomes. That objective may be environmental or social, but fundamentally it is there to drive not only financial return but also positive impact of a non-financial nature.
During the panel event, the topic of Millennials came up more than once. This is because Millennials are not just an influential demographic (those born between the 1980s and the early 2000s now represent the largest segment in the workforce) but a generation singularly focused on purpose.
One of the panelists at our event was Helen Souness, Etsy’s managing director for Australia and Asia. “Millennials,” she told the crowd, “demand what everyone deserves, which is to be heard and to make a difference with your work.”
Etsy’s global workforce of over 600 staff is made up of 73 per cent Millennials, so Helen is well placed to understand what they demand.
Gallup, PwC, Deloitte and many others have released reports or surveys that speak to how Millennials focus on purpose over profit. Deloitte’s most recent annual survey, for example, found that “Millennials very much believe that business success is built on a foundation of long-term sustainability rather than pursuing short-term profit maximisation”.
And Millennials are quite happy to “punish” employers who they see as failing to live up to ideals of sustainability, especially where they perceive a gap between rhetoric and reality. In the Deloitte survey, Millennials who were disengaged – unimpressed by their employers’ lack of purpose (lack of mentorship and mindful leadership were other avowed issues) – pose a “loyalty challenge” to their organisations, with two-thirds planning to change jobs in the next four years.
This tallies with my own experiences of speaking to peers in senior positions in major professional services firms. They speak of the struggles their companies have attracting and retaining star talent among younger workers when Millennials don’t see any alignment with purpose. Businesses are faced with a very real challenge – they will either respond to the need for purpose – with real action on social and environmental issues, not just rhetoric and empty words – or they will be left by the wayside.
To me, Etsy is a great example of a successful, and large, company that is meeting these challenges head on. It’s one of the reasons we were thrilled to host Helen at our launch event.
Etsy, a global marketplace for handcrafted goods, describes its purpose as to “reimagine commerce in ways that build a more fulfilling and lasting world”. The company, which facilitated over $2.4 billion in sales for its 1.6 million artisans last year, is a certified B Corp. The company went public in the US in 2015, only the second B Corp to do so. To become a benefit corporation, or B Corp, companies agree to independent auditing on a strict set of environmental and social metrics.
For instance, Etsy aims to transition to 100 per cent renewable electricity by 2020 and to run a carbon neutral marketplace in the years to follow. The company has an internal Sustainability Commission, consisting of a group of over 70 staff who are responsible for a range of innovative initiatives, from carbon neutral travel to incentivising employees to switch to green energy plans at home. The company’s new global headquarters in Brooklyn has been entered in the Living Building Challenge, which is described as “the most advanced measure of sustainability in the built environment possible today”.
In part constructed around sustainable designs from its own sellers, Etsy says it has focused efforts for the offices on energy and water reduction, the use of sustainable timber and the health of the building and employees. The company even composts its food waste and now diverts more than 75 per cent of total waste away from landfill.
On the social side of the B Corp ledger, Etsy’s IPO included stock options for employees and sellers, paid leave for workers doing volunteerism and a commitment to pay all part-time workers 40 per cent above local living wages. As Helen told the panel event, Etsy’s share prospectus includes some watertight legalese advising potential investors that corporate decisions will not necessarily be made to maximise profit. Social and environmental sustainability matter.
Writing for Forbes, analyst Joe Harpaz points out that Etsy’s stock options meant “up to 15 per cent of the total outstanding shares in the company’s stock will be owned by investors who benefit when the company does well and when the company does good”.
Etsy, Harpaz writes, has “successfully innovated the traditional balance between corporate social responsibility and fiduciary responsibility”.
“In a sense, by inextricably linking the fortunes of its vendors, customers and investors, Etsy figured out how to crowd source corporate social responsibility in a way that few, if any, other companies have,” he says.
Etsy’s Millennial employees are fully cognisant of this and have responded with loyalty to their brand that is off the chart. Surveyed by Great Place to Work, 98 per cent of respondents said they would tell others they were proud to work there, and 97 per cent said they feel good about the ways Etsy contributes to the community.
At the Plato Project, which I’m building with co-founders James Tutton and Mark McCoach, we are adamant that stories like Etsy’s represents a dynamic shift to a more sustainable way of doing business. This is a necessary and logical response to the world we live in, a post-GFC world with massive social and environmental problems. These are problems that the vast economic forces tied up in private enterprise must play their part in addressing. The business-as-usual approach to business is unsustainable, that much is clear.
Companies can settle for lower profits, mediocre hires and weakened brand value. Or they can embrace this shift to purpose-driven business, becoming part of the change we need to see for work and the world itself while also contributing to their own financial growth and sustainability.
Omar de Silva is chief executive and co-founder of the Plato Project.