OPINION: Larry Fink just turned social purpose mainstream

By Nick Keller, Founder & President, Beyond Sport

“Without a sense of purpose, no company, either public or private, can achieve its full potential”

Larry Fink’s rallying call for business is a both a warning for our industry and a huge opportunity for sport. It may also represent a watershed moment for business or might, as a few are saying, be some attention-seeking in the run up to the World Economic Forum in Davos.

Either way, sport needs to pay attention, adapt and offer its unique attributes to organisations that are seeking this closer more positive interaction with society.

Of course, this influential investor is not the first person to talk of this shift. In fact, it has been seven years almost to the day at Davos in 2011, that a Harvard Business School guru coined the phrase “shared value” as he clearly explained the long-term ramifications of the financial crisis and how the sector and business will need to respond.

That too was a key moment in the history of corporate social responsibility – but the true integration of business and societal objectives has not played out in as much depth and as broadly as many would have thought.

But it looks like Fink has taken on the baton saying:

“We also see many governments failing to prepare for the future, on issues ranging from retirement and infrastructure to automation and worker retraining. As a result, society increasingly is turning to the private sector and asking that companies respond to broader societal challenges. Indeed, the public expectations of your company have never been greater. Society is demanding that companies, both public and private, serve a social purpose. To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society. Companies must benefit all of their stakeholders, including shareholders, employees, customers, and the communities in which they operate.

"Without a sense of purpose, no company, either public or private, can achieve its full potential.”

With that, the CEO of gargantuan investor Blackrock just turned shared value and social purpose mainstream. 

These are no longer buzz words; it is no longer the last budget to be finalised and first one to be cut. It is actually no longer the CSR department. It is now, simply, what your business does. Making profit and delivering to society have become of equal importance in the business world. Hand in hand and symbiotic.

This presents a prime opportunity for the sport industry to make an impact.

Sport is going through massive change. While we increasingly compete against other forms of entertainment, we have hugely benefited from technology that is driving increased revenue, engagement and disruption more than ever before. 

Two of sport’s traditionally greatest assets - brand exposure and client entertainment - have been under pressure for some time. Consumer and employee perceptions are vital to the success of any campaign in sport and therefore every organisation needs to demonstrate its values.

The fundamentals have changed: ten years ago, if you wanted to identify with a certain demographic, you would choose your sponsorship and work on your activation to that target market. Now there are a myriad of ways to hit a target market with a shorter journey to engagement or purchase.

Companies have recognised this and we are seeing most investors in sport seek deeper engagement and it is rare now to see any campaign that does not have some sort of altruistic slant.

We offer business a platform for engagement that cannot only deepen client and customer relations, but at the same time further social integration, find common purpose, develop educational opportunities and of course develop wellness - both mental and physical.

As companies look far and wide for campaign ideas and programmes, sport offers the hybrid that aligns with a company’s more commercial aspirations and societal change. 

The potential is that sport, if used correctly, is one vast vehicle for social change and business benefit.

It is clear through Fink’s letter that we need to think less in isolation on how we can grow our own business, and more about how we can bring communities together. How can we heal the divides and fragmentation? Create a healthier, happier and better educated society? This is the path to a successful and profitable company.

Well, sport is not a bad place to start and our opportunity is to be creative and to think deeply about how to offer a bridge to the corporate world. After all, we now have an increasingly growing world that believes not all profit is seen as equal.