Corporate social responsibility driving performance in emerging ventures

Emerging ventures creating stronger commercial performance through social outcomes.

There have been many ideas to save the Great Barrier Reef. James Grugeon’s response was to design a craft beer and launch a social enterprise to raise funds for a reef-related charity.

The Good Beer Co’s release of Great Barrier Beer in 2016 was followed by the launch of Love² Beer to raise money for marriage-equality campaigning. The Brisbane start-up is planning a new, as yet unnamed, craft beer this year to raise funds for rescued dogs.

“We are very much a commercial company with a strong social mission,” says Grugeon. “We want to sell lots of craft beer and at the same time help causes that we are passionate about. Our company’s social mission is absolutely fundamental to its performance.”

The Good Beer Co is part of a new breed of social enterprises that are redefining the notion of business. The trend has implications for boards that want to better understand emerging trends in corporate social responsibility (CSR) and the role of social enterprises. Or for directors who want to join social-enterprise boards, some of which are recruiting independent directors.

Most social enterprises are commercial operations that intentionally tackle community problems by donating part of their revenue or profit to a social, cultural or environmental cause.

The Good Beer Co, for example, donates 10 per cent of every sale to a cause that is linked to its craft beer. It partnered with the Australian Marine Conservation Society on the release of Great Barrier Beer and Australian Marriage Equality through Love² Beer.

Still in its pilot phase, The Good Beer Co has raised more than $60,000 for its supported causes in Australia and the United Kingdom, and plans to raise millions in the coming decade.

“There is real demand in the community to support businesses that do good and give something back,” says Grugeon. “Charities want extra financial support from industry and large companies want to support social enterprises that can help achieve corporate social responsibility goals.”

Other social enterprises have gone a step further and achieved B Corp Certification, a movement that the Governance Leadership Centre examined in August 2018. Enterprises with B Corp Certification have a strong commercial imperative and social mission, and see no trade-off between these goals. The Good Beer Co is in the process of achieving B Corp Certification to add to its social enterprise credentials.

The Good Beer Co’s breakthrough came last year when the international cruise line giant, Carnival Corporation, decided to support it. P&O Cruises Australia stocked Great Barrier Beer on its ships. Half of profits from on-board sales went to the Australian Marine Conservation Society, a national charity dedicated to protecting ocean wildlife and their habitat.

Grugeon understands the perspective of corporates and social enterprises on corporate social responsibility. He held senior CSR roles in large financial services groups in the United Kingdom and later ran a small environmental charity there, before migrating to Australia.

Grugeon saw the success of Finnegans Brew Co in the United States and Two Fingers Brewing Co in the UK – social enterprises that sell craft beer to raise funds for charity – and believed a similar concept would work in Australia. Both organisations helped him.

“Craft beer appeals to a younger, modern, socially conscious market,” says Grugeon. “It’s a good fit for larger organisations that want to build their brand with this audience through a social enterprise and help the community and organisations at the same time.”

Human services innovation

Mandy Doon, co-founder of Community Services.net (CSnet), is approaching corporate social responsibility differently. CSNet is software-as-a-service that helps charities and other human services providers collect, measure and monitor client data and outcomes from the ground up.

Doon and husband Tim Gleeson, managing director and co-founder of CSnet, started the business in 2009 to help human services providers better manage client data and measure social outcomes. Both had long careers in human services and knew there was a problem with how client data was collected and used.

“Information about a client was often kept in government data silos or stored in multiple locations in the organisation,” says Doon. “We decided to develop software-as-a-service that could track the entire client journey across all programs provided by a human services provider. Having this data in one place would help organisations better measure and manage their service impact.”

A charity that helps the long-term unemployed, for example, could use the software to record demographic data about clients, assess need, create a plan and record their progress and outcomes over time.

After reading Jane Gleeson-White’s Six Capitals, which considered the role of corporations in measuring their ‘non-financial value’, Doon and Gleeson decided to embed CSnet’s social focus by becoming a B Corp.

The business completed its B Corp Certification in early 2015 and this framework is used as a benchmark for how it treats employees, gives back to the community, protects the environment, drives positive change, and its governance and transparency. CSnet formed a fiduciary board which has four members, including two independent directors.

The hard work paid off. CSNet’s revenue and customer base has tripled since B Corp Certification and it has 12 staff and offices in Brisbane and Melbourne.

“Having a clearly defined and measured social purpose has boosted CSnet’s commercial performance,” says Doon. “Good staff want to work for organisations with a strong social purpose and we find dealing with suppliers that are B Corp Certified is really positive because we have similar values.”

CSnet was recently recognised by its B Corp peers as one of 203 companies on the Best For The World: Changemakers 2018 list. Drawn from B Corps in 66 industries across 16 countries, the list recognises organisations making strong progress on their commitment to positive impact.

She says CSnet’s commercial and social imperatives are a natural fit. “Business historically had a close relationship with its community and understood its responsibility to that community. Somewhere along the way, big business stopped listening. That’s changing as business realises it can be a ‘force for good’ and do a lot of the heavy lifting to help society.”

Doon hopes human-services providers will use the firm’s software to demonstrate their credentials beyond government funding, to philanthropists and impact investors.

“By supporting the organisation’s provision of human services and measurement of outcomes from the ground up, we can help large and small not-for-profit organisations strengthen their case for funding and help funders feel more confident about the difference they make to society with their capital.”

A vision to help the world

Optometry information innovator, Myopia Profile, is neither a social enterprise nor B Corp certified. But its work to provide online information on clinical myopia management for eye-care professionals has a strong social mission that informs strategy.

More children worldwide are becoming short-sighted, possibly because of too much screen time, educational pressures and not enough time spent outdoors. More than 90 per cent of Singaporeans and 97 per cent of South Koreans are myopic by age 18.

Half the world’s population is expected to be short-sighted by 2050, according to a 2016 paper in the journal Ophthalmology. Once a child becomes myopic, the condition typically deteriorates over time, increasing the risk of eye disease during adulthood.

Myopia Profile co-founders, Dr Kate Gifford and Dr Paul Gifford, saw a need to help eye-care practitioners to access latest research on myopia. The prominent optometrists, known globally for their work on myopia management, developed papers, blogs and videos to help optometrists learn about latest products and processes to slow the progression of myopia.

Rising demand for this information led to the development of the website myopiaprofile.com and another to raise public awareness of the issue (mykidsvision.org).

“Providing best-practice myopia control for our young patients means understanding lots of areas of research, which can be too much of a challenge for the time-poor clinician in practice,” says Kate Gifford.

“Initially there wasn’t much information for eye-care practitioners on how to translate this research into practice. Over the past few years there has been a lot more research and clinical and industry interest, so it is just as important to provide a clear and credible voice to the profession to help them provide the best clinical care to children with myopia.”

The start-up venture has a strong base to build on. Almost a third of all optometrists in Australian and New Zealand are members of the Myopia Profile Facebook Group.

The business this year secured seed funding from a corporate partner in the optometry sector to develop a prototype App to consolidate its information and tools. Myopia Profile also successfully applied for a Queensland Business Development Grant that is funding an accelerated business development plan prepared by the start-up incubator, Little Tokyo Two.

Myopia Profile wants to develop and test its technology in Australia and New Zealand before scaling the opportunity overseas. “Australian and New Zealand optometrists are ranked among the highest in the world for scope of practice, so successful product and process brought to market here should scale across most of the world,” says Paul Gifford.

The Giffords understand the importance of governance in emerging ventures and are considering forming a board. Kate Gifford GAICD was the youngest chair of Optometry Australia, the industry’s peak professional body, from 2014–16, and served on its state and national boards for 13 years.

“Despite running an optometry practice for 11 years, and my additional governance experience, we recognise how much we don’t know … and how much we could learn from experienced business leaders on our board,” she says.

Peter Gifford says Myopia Profile’s mission is central to its strategy. “Keeping our social good mission as our focus means we are driven to provide globally useful solutions that improve children’s vision care and are also trusted by, and reassuring for, parents. … This gives us the motivation to keep doing the work, while we learn more about how to use this focus to drive development of a sustainable business model that delivers value to clinicians, industry and academia.”