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Leveraging the Power of Profit for Purpose Thinking

Small and medium-sized businesses (SMEs) have a unique and much bigger platform and opportunity to impact society while also growing their bottom line significantly. Yes, the two can work hand in hand, and many are now thinking about how they can grow their business for themselves, their immediate team and all of society.

The busines world is changing

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Small and medium-sized businesses (SMEs) have a unique and much bigger platform and opportunity to impact society while also growing their bottom line significantly. Yes, the two can work hand in hand, and many are now thinking about how they can grow their business for themselves, their immediate team and all of society.

The business world is changing, and more companies increasingly recognise the importance of “profit for purpose” thinking. This shift is not just limited to larger macro businesses but is now spreading to SMEs. At Pathway Group, our mission is to enhance knowledge, develop skills and change behaviours to transform communities. We are pleased to see that more and more businesses are thinking about their impact and the difference they make.

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The busines world is changing

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When asked, I often refer to the TOMs framework and measures handbook. These are tools that SMEs can use to assess and improve their social impact. The TOMs framework, a concept devised to drive the adoption of social value initially so the public sector could get more value from its business, has now been used in all different settings to help companies to identify the specific actions and outcomes that will lead to meaningful change. The measures handbook provides a set of metrics that businesses can use to track their progress and measure their impact.

The concept of the 4th sector is also gaining traction, as more businesses are recognising the importance of social impact and sustainability. This 4th sector refers to companies prioritising social impact alongside traditional economic goals. For example, the UN’s Global Goals and Environmental Social Governance (ESG) Strategies are becoming increasingly popular as companies recognise the need to address global challenges such as poverty, inequality, and climate change.

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Unique opportunity for SMEs

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Similarly, as you would expect with any movement, there are shining examples and pioneers. In this respect, the B Corporation is leading the way and is growing due to these changes. B Corporations are for-profit companies that meet rigorous social and environmental performance standards, accountability, and transparency. By becoming a B Corporation, SMEs can demonstrate their commitment to creating positive change and attract customers, employees, and investors who share their values.

In conclusion, SMEs have a unique opportunity to impact society while also growing their bottom line positively. The TOMs framework and measures handbook, the 4th sector, the UN Global Goals, Environmental
Social Governance (ESG) strategies, and the B Corporation movement are all tools that SMEs can use to assess and improve their social impact.

By embracing this “profit for purpose” thinking, SMEs can not only positively impact society but also gain a competitive edge in the marketplace. At Pathway Group, we are committed to changing lives through skills and work and are excited to see more and more businesses moving in this direction.

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