How Thinking Like a Social Enterprise Can Drive Profit and Purpose

A version of this article was originally published on I by IMD. You can read the original article here.

Ask any company CEO what they’re aiming to achieve this year, and the response will almost always be the same: growth. The fundamental paradigms of business have changed very little in the 21st century, with profit being placed above all else, and growth as the driving force to get them there.

But this is a very limited view of success. It overlooks the wider responsibilities companies have as key members of our communities, and it also ignores the fact that there are a great many organisations that have not only done incredible social good, but have also managed to survive and thrive for decades under a not-for-profit model. The continued existence of non-profits provides us with a valuable clue that chasing profits isn’t the only way to succeed.

Companies are also under increasing pressure to align their operations with social and environmental goals. Consumers, employees, and investors are demanding more from businesses—expecting them to contribute to societal well-being while maintaining financial success.

At the heart of this lies a challenge for many leaders of the corporate world: Can businesses balance profit with purpose?

The answer lies in thinking like a social enterprise—an organization that prioritizes positive impact alongside financial returns. Social enterprises have long demonstrated that success isn't just about maximizing shareholder value; it's about creating meaningful, sustainable change. Traditional businesses can learn from their approach to unlock new growth opportunities, drive innovation, and build stronger relationships with customers and stakeholders.

So, what does it mean to think like a social enterprise? Here are four key strategies businesses can adopt to integrate impact-driven thinking into their models—while boosting profitability.

 

1. Redefine Your Value Proposition

Most traditional businesses define their value proposition in terms of the products or services they offer. But social enterprises think bigger—they focus on solving real-world problems that matter to their customers and communities.

Consider Patagonia, the outdoor apparel brand that has redefined its value proposition beyond clothing. The company commits to environmental sustainability, pledging a portion of its profits to conservation efforts and even encouraging customers to buy less through its "Don't Buy This Jacket" campaign. This approach has built an incredibly loyal customer base, proving that people support brands that align with their values.

 

How can traditional businesses apply this?

  • Identify a larger purpose: What societal problem does your product or service help solve?
  • Communicate your impact clearly: Customers resonate with brands that are transparent about their mission.
  • Incorporate sustainability or social good into your offerings: Whether through ethical sourcing, fair wages, or reducing environmental impact, find ways to add meaningful value.

Redefining your value proposition isn’t just good for the world—it’s good for business. A strong purpose differentiates you in competitive markets and fosters deeper connections with customers.

 

2. Build New Partnerships for Greater Impact

Social enterprises rarely operate in isolation. They recognize that solving large-scale problems requires collaboration—often with governments, nonprofits, and other businesses. This partnership-driven model allows them to expand their reach and effectiveness.

For instance, Unilever has collaborated with social enterprises and NGOs to drive sustainability efforts in its supply chain. Through partnerships with smallholder farmers and ethical sourcing initiatives, the company ensures that its business success contributes to broader social and environmental improvements.

 

How can traditional businesses apply this?

  • Identify mission-aligned partners: Look for NGOs, startups, or social enterprises that share your vision and can enhance your impact.
  • Leverage cross-sector collaborations: Partnering with organizations outside of your industry can spark innovation and open new market opportunities.
  • Support social enterprises in your supply chain: Working with ethical suppliers or impact-driven businesses can strengthen your brand reputation and customer trust.

Strategic partnerships help businesses create a multiplier effect—where impact and profits grow together.

 

3. Adopt a Systems Mindset for Industry-Wide Change

Many businesses focus solely on their internal operations, optimizing efficiency and profitability within their own walls. But social enterprises take a broader view—they think in terms of entire systems and ecosystems.

Instead of just improving their own processes, they ask:

  • How can we influence our entire industry to adopt more sustainable or ethical practices?
  • What role do we play in shaping a better future beyond our immediate business goals?

 

A great example is Tesla. While the company certainly benefits from selling electric vehicles, it has also pushed the entire auto industry toward electrification. By sharing some of its patents, Tesla has encouraged other manufacturers to transition to cleaner energy, driving systemic change across the sector.

 

How can traditional businesses apply this?

  • Think beyond short-term gains: Consider long-term impact on your industry and society.
  • Advocate for positive change: Use your influence to push for better regulations, industry standards, or sustainable practices.
  • Create open-source solutions: If feasible, sharing innovations (like sustainable packaging designs or energy-efficient technologies) can drive broader change and position your company as a leader.

 

A systems mindset doesn’t just benefit the world—it builds resilience. Companies that help shape their industries for the better are more likely to thrive in the long run.

 

4. Measure What Matters: Beyond Just Financial Metrics

In traditional business models, success is often measured by financial indicators like revenue growth, profit margins, and shareholder returns. While these are important, they don’t tell the full story.

Social enterprises go further by measuring their social and environmental impact alongside financial performance. This allows them to track their contributions to society and adjust strategies to maximize positive outcomes.

For example, Danone, the multinational food company, has integrated B Corp certification standards into its business to measure environmental and social impact. By committing to transparent impact assessments, the company builds trust with consumers, investors, and employees.

 

How can traditional businesses apply this?

  • Set measurable impact goals: Just like financial targets, establish key performance indicators (KPIs) for sustainability, social responsibility, and ethical practices.
  • Report transparently: Share progress on ESG (Environmental, Social, and Governance) initiatives with stakeholders.
  • Align incentives with impact: Consider tying executive compensation or employee bonuses to social and environmental performance.

 

When businesses measure what matters, they gain a more holistic view of success—ensuring they create value for society as well as shareholders.

 

The Business Case for Thinking Like a Social Enterprise

Thinking like a social enterprise isn’t just an ethical decision—it’s a smart business strategy. Companies that integrate purpose-driven innovation, strategic partnerships, systems thinking, and impact measurement position themselves for long-term success in an evolving world.

 

By embracing these four strategies, businesses can:

  • Attract and retain purpose-driven customers and employees.
  • Foster innovation and expand into new markets.
  • Strengthen resilience in the face of societal and environmental challenges.
  • Drive both profit and positive impact—proving that the two are not mutually exclusive.

The future belongs to businesses that can profit by thinking like a social enterprise. The question is: Is your company ready to make the shift?

 

Let’s Continue the Conversation

What steps is your organization taking to integrate purpose into its business model? How do you see the future of business evolving to prioritize both profit and impact? Share your thoughts in the comments!

Paul Ryatt
About the author
Paul Ryatt
As the CEO and original visionary who came up with the idea of Copalana, Paul is the mind behind the entire platform, and the glue that holds us all together. But it's not just his background in software and inspirational nature that makes us tick: it's his ability to connect with people from all walks of life, to effortlessly bring people together, that drives Copalana forward and turns our core philosophy into action.
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