The power of paying people properly

Yesterday I had a series of meetings with a charity, an academic and a business coach. What did they all have in common? They are all of the view that profit and social good do not have to be mutually exclusive. More than that, actually; they are all of the view that profit is necessary if an organisation hopes to recruit and retain the best staff so they can make a positive impact. 

I work a lot with organisations who find it difficult to reconcile the tension between profit and purpose. Yet without profit, sustainability remains elusive. If we are going to ensure that our organisations exist for long enough to make an impact on its social or environmental objectives, we need to develop business models that are both ethical and profitable. 

Many purpose-driven business leaders are understandably motivated by their wider social or environmental impact and this is what drives them in their business. Profit is a secondary concern, and can even be something that makes purpose-driven business leaders feel uncomfortable. However, it’s crucial we pay close attention to the financial bottom line, if we are to develop sustainable and impactful businesses that attract the most talented and driven employees. 

Profit isn’t just about shareholders. It’s about reinvesting in our businesses to make them more effective, more impactful, and more attractive to the most talented staff. 

If we, as purpose-driven business leaders hope to recruit and retain talented and dedicated staff, we need to be able to offer them more than a job. We need to offer them respect and reward for their time, the potential to grow, and decent compensation and recognition for their contribution to the business. When staff feel undervalued it erodes their productivity and causes huge challenges for morale and working culture. We need to pay people well and competitively. If we support them to be the best version of themselves at work, this will impact well beyond them individually. Our businesses will reap the rewards. 

It’s no secret that people want more than just a paycheck; they want to feel that they’re doing something purposeful and fulfilling. This does not, however, entitle us to expect our people to work for less than they’re worth. If our talent pool can earn twice as much in a corporate job and donate a percentage of their income to their favourite cause instead, then how can we possibly expect to keep the best people? 

We must learn the value of profit in purpose-driven business. We need to value our employees, or risk losing them.