Work on purpose

One of the questions I get most often is whether we’re even allowed as a company to make tradeoffs that favor stakeholders over shareholders. The short answer is yes. B Corps lock their mission and stakeholder priorities into their company by laws, allowing the company to make decisions that have a material positive impact on society, even if it doesn’t explicitly benefit shareholders. However, there is a bigger point here to be made for any business, even ones without stakeholder clauses in their corporate bylaws. The question about shareholder value vs stakeholder value assumes a zero sum game. On the contrary, our strategy is to create more shareholder value in the long term by investing in stakeholder impact today.

“Our strategy is to create more shareholder value in the long term by investing in stakeholder impact today.”

The B Corp movement is about responsibility, but it’s not about altruism. That’s a good thing, because it creates benefits for stakeholders with a business imperative to scale. The future of doing good business combines impact model with business model, rather than seeing social benefit as a philanthropic afterthought to make good on harm done by the business.

Here’s an example: If we were to suddenly switch to using less expensive commodity eggs rather than Certified Humane, free-range eggs in our mayo, would our business improve because our margins are higher? No. Our customers would no longer have a reason to pay a premium, the product wouldn’t taste as good, and we’d sell less. Even if we were to then drop our prices, we still wouldn’t be able to rise above the myriad other conventional brands to win customers. In doing better for animal welfare, we do better for the customers, and better for our business. As a part of this movement, companies must challenge themselves to create distinctions that can benefit customers, stakeholders, and their own long term fortune.

So, what are our positive contributions? Our mission is to reimagine ordinary and overlooked foods with fearless integrity and charm. At the most fundamental level, it’s protecting the integrity of food. Building on this are our product values, especially “if it’s not food, it doesn’t belong in our food.”

You may be wondering what difference a single company can even make. With our growing scale, we both influence and rely on a vast and interconnected food system. Food is the centerpiece of culture, defining our identity, creating connection between people, and nourishing us.

Food was the impetus behind human civilization, with the agricultural revolution transitioning us from a nomadic to a sedentary species. It drove the invention of the first writing systems, developed in Mesopotamia to keep track of who sold grain to whom. Yes, the first written document was probably a grocery receipt.

Flash forward 10,000 years, and the food system has grown to gargantuan proportions, with gargantuan impact. It has a big impact on people, representing an $8.1 trillion dollar global industry employing 1 billion people in agriculture alone. Yet in America, according to the USDA, for every dollar that a consumer spends on food, only 7.8 cents actually goes to the farmer growing it. This vast food system accounts for one third of greenhouse gas emissions and the five largest food processing companies emit more carbon than the biggest oil companies.

We’re not here to vilify the “food system” as if it is the evil empire, or cast anyone, including ourselves, as hero or villain. It is not that Sir Kensington’s is “good” in its very nature, but instead, like all companies, we are defined by a collection of actions, each with an impact. Our goal is to increase the good behaviors, good actions, and good commitments which improve our impact.

The positive decisions we’ve made didn’t happen because we thought of ourselves as an altruistic company. What started us on our path was taste. We’ve always prioritized taste in our products, because if our products didn’t taste good, they’d never sell. That led us to learn about ingredients. Of course it was the clean, natural ingredients that gave our condiments the best taste. Back when we launched our Mayonnaise, it was our retail customers, like Whole Foods, that pushed us to use Certified Humane free range eggs and to become the country’s first mayonnaise to be Non-GMO Verified. That led to true market differentiation, and practices we’re now committed to. It was all of you customers that led us to educate ourselves, certify as a B Corp, and continue encouraging us to do even more. A company doesn’t have to be founded on a social mission to do good, and more important than labeling yourself as a good, bad, or amoral business, think about what action you can take to be the change you want to see.

Churchill said that democracy is the worst possible system of government, except for every other system ever proposed. Similarly, capitalism has ushered in unprecedented human development, improving quality of life tremendously over the last three centuries, but it’s also brought unprecedented inequality and environmental degradation. Now, the world around us is shaped primarily by the activities of business, and so we must consciously shape business. Capitalism is an unstoppable force, and rather than fight it, we can hijack it. It’s up to us, to you, and anyone with the power of choice to use it for good.