Insights

Could purpose-washing damage the reputation of your organisation?

Commoditising social movements in order to ‘out purpose’ the competition is something of a new trend. 

Leaders everywhere are clamoring to differentiate their companies by being more sensitive, more representative, more #MeToo - even when these social movements do not align with their own company values and culture. Having a higher purpose for your organisation seems to be the latest buzzword that companies must embrace, if they want to increase their customer loyalty, drive their performance and importantly increase their profit. And here is where the negative phrase ‘purpose-washing’ has come from. It would seem that this sudden surge in organisations plastering a ‘purpose’ onto their marketing campaigns does not come from a noble place, but instead a place of self-interest. 

Now, companies want to see themselves as leaders in tackling some of the world's most complex issues. 

“Organisations are jumping on the ‘purpose’ bandwagon to convince the world that they’re putting the planet and people before their pocket”

In recent times, the National Australia Bank (NAB) should serve as a statutory reminder that an investment in purpose can be detrimental if not properly brought to life. 

Banks can get a bad wrap for being a cold profit maximisation machine. In order to soften this image, banks across Australia have tried to wipe over any negative brand associations, with a glossy new facade in the form of a purpose ‘North Star’. Several years ago, The Commonwealth Bank of Australia stated its purpose was to improve the financial wellbeing of its customers and communities,’ while ANZ Banking Groups' stated they exist ‘to shape a world where people and communities thrive.’

But the purpose that really got my attention for all the wrong reasons, was the National Australia Bank (NAB). NAB stated in early 2018 that their new purpose was ‘to back the bold who move Australia forward’.

And I asked, isn’t the purpose of NAB to build and protect the wealth of Australia? Does ‘backing the bold’ forsake their audience and alienate the hardworking Australian who is just looking for their first mortgage. Did NAB really get their purpose right in the first instance?

NAB released the following statement ‘We know that today many people outside of the bank will be sceptical of NAB's purpose, and we understand why that might be. But we didn't write it for publication. We wrote it for ourselves.’ And, I feel that they only released this statement because of the negative backlash they received. 

The problem with ‘purpose’ is that some organisations use it as their marketing strategy rather than the core of why their business exists. If your purpose is clear and consistent with your organisations values, there will be no backlash. The backlash only exists when you get your purpose wrong. 


When the ‘purpose promise’ is disconnected from the ‘purpose experience,’ organisations are at a real risk of being accused of ‘a canny marketing campaign’ instead of having good intentions. And doing so threatens to destroy trust when it is already in short supply. 

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Today, organisations know what they do (sell shower gels), some organisations even know how they do it (through clear brand differentiation, fun packaging, and a creative ad campaign), but very few know why they do what they do. 

Every organisation is created to solve a social problem. Perhaps one of the best examples of that is Unilver.

Unilever was founded on a sense of purpose in the 1890s by William Hesketh Lever. Driven by the negative socio-economic state of Victorian England, Lever created the Sunlight Soap to solve the social problem of disease that was plaguing the lower class due to poor hygiene. And so, the purpose of Unilever was to make ‘cleanliness commonplace.’ Unilever has not changed its purpose for more than 100 years. They have only recently updated it for the 21st century - not to stop people from looking and feeling good but also to give back to the community through ‘making sustainable living commonplace.’ There is a common thread for Unilever's reason to exist and subsequent purpose. And this consistency is what has driven the businesses long term value. 

“Maintaining continuity of the organisational purpose is paramount for remaining authentic and true to who you are.” 

A purpose is both the guiding north star that leads us through rivers and valleys and the sinew that holds our organisation together. A purpose tells customers and staff where the business is going. And in light of the purpose, an organisation will follow this north star and act accordingly. 

The purpose of your business is not the domain of the marketing team, just as much as it does not belong to your customers alone. The purpose of the organisation is shaped by the founder and management are simply the stewards that execute it. No one has the authority to change the purpose as it belongs to your business. It is the backbone of everything. 

It is not a marketing strategy intended to boost short term profits or a heroic statement you can make in the hopes that you will win the hearts and minds of the masses. If a business confuses its marketing with its purpose then it isn’t really purpose, its just PR.