Is it harder for ethical businesses to drive performance?

For the most part, almost every business makes ethical considerations. Whether it’s devoting time and effort into your ESG, or placing a positive emphasis on the mental and physical wellbeing of your staff, being ethical in some capacity is not only the right thing to do, it’s become an important stake in being an attractive employer in a competitive market...
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HR Grapevine | Executive Grapevine International Ltd
Is it harder for ethical businesses to drive performance?
Feedback and development are quickly becoming a main priority for Gen Z and early careers

For the most part, almost every business makes ethical considerations. Whether it’s devoting time and effort into your ESG, or placing a positive emphasis on the mental and physical wellbeing of your staff, being ethical in some capacity is not only the right thing to do, it’s become an important stake in being an attractive employer in a competitive market.

Various studies echo the sentiment that young people want to work for organisations that share similar values regarding ethics, DEI and ESG. Unsurprisingly, young people, who will shortly make up the majority of our workforce, feel being a business that’s good for the world is important.

For a business where being ‘good’ is the main part of your brand, you’re likely to appeal to this specific candidate pool. And the likelihood is, that people will want to work for your organisation because they share the same values as you.

“Ethical businesses are more purpose focused, because someone has started it usually because it’s something that they believe in,” says Fran Newman, Chief People Officer at Deliciously Ella. “From my experience, these types of organisations tend to be more mission-led and it feels more genuine, particularly in the smaller plant-based organisations I’ve worked in.

Being an ethical brand can be used to your advantage. You can build up trust and really get to know the people in your organisation, and this builds credibility. And if you have that, you can be honest in a way that’s really kind and supportive

Fran Newman | Chief People Officer, Deliciously Ella

“I choose to work somewhere that aligns with me and my lifestyle and values, and so these types of businesses attract people with similar sorts of values.”

Despite this, the ‘niceness’ associated with being an ethical brand can sometimes make it difficult for these types of firms to drive performance and create a culture of constructive criticism and feedback. So, how can you be an ethical business, but still drive performance? And, can being ‘nice’ actually work in your favour in facilitating growth?

Nice guys finish last?

To be able to get into the discussion of whether being an ethical business impacts your ability to drive performance, we must first understand where these perceptions come from.

If we cast our mind back to the corporate world fifty years ago, there was a clear separation between work and home life. Wellbeing wasn’t a part of work-life conversations, and there was a culture of hustling, grinding, and going above-and-beyond for your employer to succeed, far more than there is today.

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