"There's certainly not an incapability between doing well and doing good," eccentric billionaire Sir Richard Branson tells Fast Company. Branson's new book, Screw Business As Usual (which goes on sale today), asks that as long as entrepreneurs can make extraordinary sums of cash while helping others, why do business any other way?
A business with a social conscience, he argues, will have more motivated employees, save resources, drive higher profits, and, paradoxically, be more satisfying than even the material wealth it creates. (As a billionaire, Branson has the unusual experience of knowing just how much happiness money can buy.)
Screw Business As Usual reads like a series of loosely related case studies and anecdotes that chronicle Branson's jetset philanthropic life, from island-hopping with celebrities to help third-world villagers, to his boyhood arrest for distributing venereal disease education pamphlets in college (which was illegal at the time). Now, as the head of the sprawling Virgin empire, he tries to instill a social-impact component into each new venture.
In one instance, Virgin Money, its retail banking arm, offered up its transaction infrastructure to reduce the credit-card fees that donors pay to runners-for-charity of the London Marathon (reducing fees from 6% to 2%). Branson writes that Virgin Money's impact on the $100 million fundraising event illustrates how business can have a much larger social impact than nonprofits.
"The trouble is, not being businesses, [nonprofits] never made expansion one of their objectives and sadly all of us have made the mistake as donors to encourage this limited type of thinking. Often, they're geared around being drip-fed by philanthropists and foundations, usually on a project-by-project basis…you're never going to be in a position to build the capacity that you need to make a big difference."
While light on analysis, Branson's book does offer a few logistical reasons why socially conscious business is good for the bottom line. First, Branson contends that Virgin employees, motivated by their love of the company's social mission, work harder.
"They realize that we are more than just a money-making machine. And, I think, because they're proud of working for the company. Because they're proud of going out in the evenings and having a drink and saying that they work for Virgin," he said. "I think they'll make that little bit of an extra effort, which is good for the bottom line."
Indeed, it may not just be good for productivity, but a precondition for retention, as many employees (especially young ones), prioritize social impact and volunteer opportunities in their job search.
Second, he says, waste is enormously expensive; reducing resources is both good for the environment and good for keeping down costs. "Fuel is nearly 30% of our costs," Branson says of Virgin's Airlines. Branson is aiming to have 100% clean-burning fuels by 2020. "The airline industry could become one of the cleanest industries, rather than one of the dirtiest industries in the world."
Third, as a billionaire, Branson has a unique perspective on the mindsets of the ultra-rich and famous. "I think most successful people in life do not start with the money-motive whatsoever," he says, citing examples such as Google, which he argues started out to "make a difference in people's lives."
Indeed, Branson is one of the few living individuals who actually knows how much happiness money can possibly buy. Philanthropy has "enriched my life far more than having a few dollars in the bank account," he says, with conspicuous humility.
"I was a lad of the '60s", he says, "I was brought up to try to make a difference." Other successful CEOs aren't nefarious, he contends, they just haven't been reared to believe business can make a difference.
"I suspect some of them don't even think about it, it's just the way business has worked to date," he says. "Hopefully a book like Screw Business As Usual will be the start of a new trend."
Click here to read an excerpt from Screw Business as Usual.
[Listing Image: Flickr user Gulltaggen]
[Top Image: Getty Images for Rock The Kasbah, Virgin Unite's Los Angeles book launch event]