By the Lionesses of Africa Operations Department
According to the FT (here), there is “a new corporate currency, and it is a composite of three factors: purpose, why [the company] does what it does; culture, what staff experience; and brand, its reputation. The era of non-financial data transparency and advanced stakeholder capitalism is upon us. Corporate stakeholders, from employees and customers to board members, investors, partners and regulators, are calling for greater disclosure of information related to the “four P’s”: people, profit, planet and purpose. All corporations must prepare for a future in which details of their work in these areas are open to all.”
But what does that mean in reality for Lionesses? Are we going to have discussion where before there was only….talk? Or will there really be action, and what will be the catalyst? As we have mentioned in a previous Blog:
“Big businesses spend trillions of dollars on suppliers every year, yet just 1% goes to businesses owned by women.” Global Citizen.
…so there is clearly a serious opportunity begging for action!
Tuesday, as many know, is when we take a few hours off to listen to, or watch something outside of our normal work. Today we had our time split by two podcasts and one online conference, but they all had a central theme - the value of why, purpose and vision.
The first was a podcast from Ryan Tansom’s great series entitled: “How One Woman Raised Millions in a World Where Men Control the Capital” (here) with the incredible Sarah Dusek.
She is driven by a conviction that -
“your why, your purpose and your vision must be aligned.”
and although now having successfully raised finance for her company, then sold that company and recently raised a fund to invest in an essential area of financing - Women owned businesses in America, where “Less than 2% of female founders receive [funding] from VC”, initially she found it almost impossible to break into the close knit club of finance: “My journey to become one of the 2% of women able to capitalize their business was a very, very painful, difficult, frustrating journey…there’s something wrong with the way this works. It’s not equitable, it’s not right and it’s not really based upon the merit of great ideas and great businesses. It’s really based…on who you know, maybe where you went to school, and who you have got connections with… I didn’t have any of those things!”
So how can this change? What could be the catalyst?
Of course we all dream that finance is an answer to all our problems (forgetting of course that Private Equity money is not there to pay us a huge salary, but to turbo charge the business whilst controlling costs), but really our businesses only stop being hobbies and become real when we get actual customers and it is through these and the subsequent growth, that interest from PE firms start (or so all the MBA books say!). This is why we at the Lionesses Den also work hard on opening up dialogue with the leadership of large western companies to make them understand the huge potential of adding Lionesses to their supply chains.
We are now dealing with many forward thinking leaders within these companies who have the great vision and understanding of what the globe truly needs and how their companies fit into this, but for the world to really change there is a need for a paradigm shift in the thinking of all companies.
Luckily, the world has been given the SDG’s as a route map and so many great companies have been quietly working for some time with little fanfare to bring the SDG’s into their everyday life…and this is starting to show in their reporting. In 2019, thanks to the GA Institute, we know that 90% of S&P 500 companies reported their non-financial disclosure with 36% presenting alignment with specific U.N. SDGs as shown here.
This report lists the top 5 SDG’s invested in (time, effort, money) by the S&P500 companies. When one considers that the S&P500 contains companies such as Apple, Microsoft, Amazon, Facebook, Tesla and Google, you begin to see why this is so important.
Their top 5 SDG’s were (in order):
SDG8. Decent Work and Economic Growth (no great surprise).
SDG13. Climate Action (Ditto).
SDG12. Responsible Production and Consumption (does your complete supply chain contain those who and items which help or hinder the world through SDGs, ESG or Sustainability?).
SDG5. Gender Equality (great to see this here - no prizes as to why that is important for Lionesses, we fight daily for greater access to finance and supply chains, but it also covers so much more such as fair and legal access to land/property ownership, essential tool for collateral).
SDG7. Affordable and Clean Energy (Yes please!).
Obviously, the SDG’s are not what drives us as Lionesses, it is our ‘why, purpose and vision’ (solving SDGs given our natural community impact, and vision to solve pressing problems as women entrepreneurs, just happens naturally). But such results do give us hope that people’s gaze is turning to Africa, and as we see above, Gender Equality is an impressive 4th out of the top 5 most aligned with these global 500 companies. This is important for our inspirational membership who find their why, purpose and vision in solving issues through business, that just happen to cover not only SDG5, but so many of the SDG’s (especially the above 5).
This change seen in the corporate world was also confirmed in our next podcast, part of the great ‘Talks at GS’ where senior leaders at Goldman Sachs speak with top game changers around the world. This one was with Marc Benioff, chair and CEO of Salesforce (world’s no.1 CRM company with a revenue of US$17.1 Billion in 2020). In this he said that: “Business is the greatest platform for change” and “[he was] looking for ways to positively impact the world”. Given the impact that Salesforce under his leadership has had before and during the CV19 era, he is clearly leading from the front. He ended his discussion: “CEO’s have to take on new responsibility - and they get it!”
This is extra important for us at the Lionesses Den, exactly because where the major companies go, so banks and finance follow…
Pausing only to change into our snow boots and ski gear, we tuned into the Davos webinars held in Switzerland…
The session we were drawn to was Implementing Stakeholder Capitalism and as if by magic, there was Marc Benioff once more, from his home emphasizing that CEOs must:
“…manage for all stakeholders, not just shareholders…there has been a mantra for too long that the Business of Business is Business, but today the Business of Business is about improving the state of the world.”
But not wanting to turn our entire blog over to him (although we could listen to him for hours!), we were then drawn to Larry Fink, the worlds largest investor via his investment company BlackRock.
Having already shown his deep belief in ESG and Sustainability in his annual letters, in this Davos session he stated that investors will look more to invest in companies taking these essential areas seriously, indeed he described it as a ‘tectonic shift’. As reporting grows (such as we see above from the S&P500), he sees new customized indexes being created to cover ESG or SDG issues that are important to investors. So if your company is not included, this would be reflected in your stock price as investors sold their shares or simply ignored your company. As a CEO try explaining that to your shareholders!
Why is this important for our membership? Where Larry Fink goes, so the world follows. For too long we have missed out on finance or access to certain supply chains, but now, not only will those forward looking companies and major league CEOs who have supported us be rightly recognised, but others will be forced by this action to look to Africa and the incredible businesses our membership have.
This is the catalyst to create a paradigm shift for all companies.
As always we never look for charity, only for a recognition that our businesses, and our goods and services, are as good as any. But what makes us stand apart is that our why, our purpose, our vision aligns with this beautiful earth, and although sustainability is rightly so much about net zero for carbon (as Larry Fink emphasized - “Sustainability and the ’S’ of ESG intersect”), for us this is also shown in our natural commitment to our communities, our employees, our future.
Listening to incredible leaders such as Sarah Dusek, Mark Benioff and of course Larry Fink, gave us hope and as we always say, where there’s hope there’s life.
Keep the faith, the world is turning.
Stay safe.