The Past, Present, and Future of Social Impact Platforms
You’re at coffee with an old friend whom you haven’t seen since college. Well-established in your careers, this catch-up has been a long time coming. The conversation shifts to your jobs.
Your friend asks you the usual questions: benefits, salary, growth opportunities, etc. Then they ask you one that catches you off guard.
“What’s your company’s social impact platform?”
You reply, “Ummm, what? We don’t have one.”
Your friend turns pale. Appalled, they take the last sip of their latte and storm out of the cafe — leaving you with the check and a bruised ego.
Now, this is an unlikely scenario. But at DoSomething Strategic, we’re working to build a future where a company’s social impact platform is just as important as the product itself and employee value proposition.
The landscape for social impact platforms is rapidly changing as companies embrace the idea that their employees and customers are expecting stances be taken on a company’s values. At the center of social impact platforms are your consumers and most recent company hires: Gen Z. We’ve not yet seen a generation as vocal as them who value and expect companies to do better and do more to improve the world.
Before we talk about the evolving landscape of social impact platforms, let’s define this.
What is a social impact platform?
DoSomething Strategic defines a social impact platform as the cause(s) a company chooses to adopt at the heart of their mission. The platform ensures that all efforts—from internal policies and practices to employee volunteer opportunities—connect to this mission, resulting in a true inside-out expression of the company’s purpose.
A social impact platform can and should interconnect with a company’s corporate social responsibility (CSR) or environmental, social and governance (ESG) strategy, but they do not have to be dependent or exclusive from one another. We’ll address those terms later and how they inform the current and evolving social impact landscape.
What is the history behind social impact platforms?
Social impact platforms have increasingly grown in prominence, especially during the last decade. So, when did the United States pair doing good with running a profitable company? Let’s walk you through the timeline.
1800s-1900s
In the late 1800s and early 1900s, multimillionaires sought to find practical ways to disperse large amounts of wealth to influence social change. It required an effective, organized approach that had not yet been seen. Wealthy industrialists of the era created trusts and foundations so that professional managers could distribute money for social causes in a way and at a scale that helped to neutralize criticism (and maybe some guilt) for unethical business practices.
1950s-1960s
In 1953, Howard Bowen, an American economist and Grinnell College president published Social Responsibilities of the Businessman which advocated for business ethics and societal stakeholders. He coined the term corporate social responsibility (CSR). CSR is now defined as “a self-regulating business model that helps a company be socially accountable to itself, its stakeholders and the public.”
In 1969, the term ‘social impact’ was used for the first time at Yale University in a seminar about the ethical responsibilities of institutional investors. A precursor to many of the investing options we have now, the seminar aimed to consider the social and environmental aspects of investing.
1970s
In the early 70s, Bill Drayton founded Ashoka and the social enterprise movement took shape in the U.S. Drayton was influenced to create Ashoka by Vinoba Bhave, an Indian advocate and social reformer who created waves in social innovation with his Bhoodan Movement or Land Gift Movement, according to Supply Change. To this day, Ashoka’s focus is to train and sponsor social entrepreneurs to create change.
2000s-2010s
In the 21st century, private companies increasingly adopted positions that had previously been considered public sector domain — think labor conditions, gender inequality and environmental concerns.
“But it was in the onset of the Global Financial Crisis [of 2008] that the term [social impact] found salience,” said Dr. Robyn Klingler-Vidra, Senior Lecturer in Political Economy in the Department of International Development at King's College London. Klingler-Vidra also first noted that the annual interest in the term ‘social impact’ has steadily risen since 2008 according to Google Trends.
The 21st century also saw the emergence of brands like BLQK Coffee and Warby Parker which created social impact platforms inextricably linked to their business models. For example, BLQK Coffee donates 25% of profits to charity to further social justice initiatives. Warby Parker works with community partners, nonprofits, government agencies, and academic leaders to provide free vision screenings, eye exams, and glasses to adults and children — distributing over 8 million glasses in the U.S. and worldwide. For consumers, this meant a new way to shop; and it felt good.
Investors took note. In the mid-2010s, they began paying attention to environmental, social, and governance (ESG) data, including information about companies’ carbon footprints, labor policies, board makeup, etc. Large investment firms demanded their portfolio of companies “serve a social purpose,” and argued that without such a purpose, companies might not reach their full potential.
In 2015, 190 world leaders from the United Nations member states convened to draft the Sustainable Development Goals. The 17 goals are an effort to help end extreme poverty, fight inequality & injustice and fix climate change. ESG strategies typically have aligned with these goals with ESG investing increasing every year since 2015.
What do social impact platforms look like now and where are they going?
We’ve concluded our history lesson. Let’s focus on where we are NOW. Where companies may have felt pressure previously from investors to support ESG issues, consumers and employees are also now making their voices heard.
Many companies are still finding their footing when determining their social impact platform. Often, it’s associated with “cause marketing” or simply a few volunteer days a year for your employees. Others that DoSomething Strategic work with are listening closely to what their stakeholders want — and what society needs. From top-to-bottom, they’re identifying a cause that matters intrinsically and building internal and external strategies that address the issue.
Companies are still in very new territory. So, what’s to come?
Predictions for the future of social impact platforms:
Companies will use their next strategic plan to embed social impact goals in their long-term vision. The start of the new year means that companies may find themselves in the planning phase for their next 3-5-year strategic plan. It’s likely that they will build out and hire for roles in a “social impact” department. Many will recognize that this should not fall under your marketing department but should work alongside that team to scale and promote your long-term impact.
Investment firms will double down on the importance of ESG ratings, but will be more discerning in ensuring companies avoid “greenwashing,” among other deceptive practices. Disgraced cryptocurrency fraudster and FTX founder, Sam Bankman-Fried, showed the world that ESG scores are exploitable. FTX’s previously high ESG score is a sign that work needs to be done to ensure ESG rating firms are not getting fooled by the likes of Bankman-Fried, which ultimately hurts stakeholders and dilutes the importance of ESG ratings.
Artificial intelligence will cement its role as a tool helping society reach social good outcomes. Software like ChatGPT is turning heads with its lightning-fast responses to complicated, nuanced questions that users pose to it. It feels like we’re in the honeymoon phase of A.I., with everyone marveling at its capabilities — but it’s not without extreme risks. Bad actors are already finding ways to program A.I. to monetize and manipulate for nefarious purposes. On the other side of the coin, good actors will soon be able to tackle social issues by reverse engineering the outputs necessary to reach the goal. For example, “how can society cut deforestation in the Amazon Rain Forest by 5% in the next five years?” We’ll watch A.I. describe the different paths, and stakeholders, available to reach the desired outcome. Whether you like it or not, A.I. is here to stay, so let’s make sure it’s being used to aid and assist us in addressing some of the world’s most pressing issues.
Gen Z uses their growing disposable income and workforce representation to pressure companies to adopt social impact platforms. Eighty-eight percent of Gen Z say it’s important for brands to take actions around purpose according to a 2021 DoSomething survey. Our recent economic blockers survey found that 47% of our members refuse to buy from companies whose values don’t align with their own. This is significant considering that Gen Z had $360 billion in disposable income in 2021. That’s not all. Their workforce representation is set to double from 13% to 27% by 2025. Where Gen Z works and spends its money will be dependent on how they perceive your brand.
Those are just a handful of ways we see social impact platforms changing with the evolving world. With nearly 30 years of experience decoding young people’s perspectives on and behaviors related to their social, political, and economic conditions, DoSomething Strategic can help future-proof your brand and strengthen the way you communicate and implement your social impact platform.
The next time you’re out to coffee with an old friend and they ask you about your company’s social impact platform, you’ll say something along the lines of, “ever since we adopted our new platform, investors are profiting, customers are buying more, and employees are happier and more productive.”
If you’re striving to align your stakeholders around a common cause, this is your opportunity. To help you build or reimagine your current social impact platform, let’s talk.