The Road to Hell, part 1 of 3

My collected case against purpose, the movement that took over the business and branding world in the 2010s, and continues to lead nowhere good. This is part one: what it is and where it came from.

This three-part post is an expanded version of a talk I gave at the Worksmarter conference in Ghent in June 2023. Regular readers will know I’ve written a lot about purpose (as far back as a Creative Review article in 2017). But preparing the talk prompted me to bring the whole case together in a way that might be a useful reference point in future, if only for myself.

Introduction
I’m aware it will strike some observers as strange to see anyone making the case against purpose. For many people, purpose simply represents the idea of businesses trying to do something good in the world. So how could anyone be against it?

The clue to my answer is in the title: The road to hell. It comes from an English proverb: The road to hell is paved with good intentions. And my argument is that, for all the often good intentions behind purpose, it’s a fundamentally flawed way of thinking about ethics in business and marketing: one that not only leads to worse marketing, but also leads to worse social outcomes. I’ll make that case over three posts:

Part 1:
What is purpose?
Where did purpose come from?

Part 2:
How does purpose lead to worse marketing?
How does purpose leads to worse social outcomes?

Part 3:
Why does it matter?
What’s the alternative?

Astute readers will notice I’m ignoring the advice of Simon Sinek and ending with why, rather than starting with it. There’s a logic to that. One of the reasons I’ve written all these posts (and one of the reasons we do anything creative) is to find out why I’m doing it. As I’ve written before, creativity ends with why. And one of my problems with purpose is that it’s a fundamentally anti-creative mindset.

But we’ll come back to that at the end.

First, here we go with part one.

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What is purpose?

The purpose debate often gets confused by people using different definitions, so let me clear at the outset. When I talk about purpose, I’m almost always talking about social purpose. This is the definition that has energised the whole debate, and is the reason the debate exists in the first place.¹ Broadly, it’s the idea that businesses should define themselves around a wider societal purpose that goes beyond simply doing what they do in order to make a profit, pay their people and pay their taxes. It’s the claim that businesses should set their sights on something broader and more socially positive than that.

The core mantra of the movement is Do well by doing good—the idea that, by doing something good in the world, businesses will be rewarded in the marketplace. And you can see why business leaders would find it compelling. First, it flatters them into thinking they’re the good guys. And we all want to think we’re the good guys—it’s an understandable instinct. Second, it implies that no difficult trade-offs are required. You can do the right thing while enjoying all the material rewards you’ve enjoyed to date. What’s not to like?

I also want to be clear that, in defining purpose as social purpose, I’m using the same definition as the most powerful people on the purpose side of the debate. For example, Larry Fink is the CEO of BlackRock, the asset management firm that controls $10 trillion of investment flowing through companies around the world. He’s been one of the most vocal advocates of purpose, and he uses the same definition I would. It’s about social purpose, and it’s about much more than a marketing campaign—it’s a deeper claim about a company’s fundamental reason for being.

So we’re broadly agreed on the definition. But that phrase ‘reason for being’ is interesting. At least in the English language, we have terminology that describes the ‘reason for being’ of any organisation. What is the organisation for? Well, some organisations are for-profit and some are not-for-profit. As a society, we’ve treated that distinction as meaningful. We tax these organisations differently, and apply different forms of employment law. And we positively expect not-for-profits to intervene in social issues, because that is their reason for being. Indeed, we feel more comfortable about it because we know they’re not doing it for profit. Traditionally, we haven’t expected for-profit companies to claim the same authority to intervene in social issues. They are limited companies partly in the sense of being limited in the scope of their social licence and authority.

There’s another way to define purpose, which is to look it up in the dictionary. It highlights an interesting wrinkle in the debate. You can see how the primary definition is the same as Larry Fink’s ‘reason for being’. The purpose of an organisation is the reason for which it exists. All clear enough.

But the secondary meaning is a clue to one area where the debate gets confused. I think many purpose advocates use ‘purpose’ in the secondary sense, essentially to express a state of mind. By that reading, ‘purpose’ isn’t a categorical claim about a business’s reason for being: it’s more a statement of intent. A deeply held resolve to do good.

We’ll circle back to this towards the end. But for now, I’ll note two things. Firstly, when it comes to organising large groups of people into complex systems like corporations and markets, incentives play a far greater role than intentions. You can intend great outcomes all you like, but intention alone won’t change the countless micro-incentives that affect every decision made at every level of the system. Indeed, your strongly held intentions may end up blinding you to the subtler incentives that are shaping what you do. The road to hell is paved with good purposes in that secondary sense.

But there is also a philosophical question about whether a business can even have a purpose in the secondary sense. In the end, a business is just a legal construct, not possessed of a conscience or an inner sense of resolve. The only way purpose can exist in the secondary sense is in people. In part 3, I’ll explain why this is an important distinction. For all that I’m a sceptic of business purpose, I’m not against the idea of human purpose. If anything, I see it as the essential counterbalance to the logical momentum of corporations.

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Where did purpose come from?

If, as I argue, the idea of purpose doesn’t fundamentally make sense, the question arises—where did it come from?

At some point, I might write a longer post about that. For now, it’s enough to say that the debate about the social responsibility of businesses has been around for as long as business has existed—certainly since the days of corporate behemoths like the Dutch East India Company, which commanded its own private army and had the power to imprison and execute convicts.

I recommend this book, which relates the tales of Robert Owen, the Co-operative Movement, Cadbury’s, Lever Brothers, John Lewis, Levi Strauss and Body Shop, among others. The subtitle is Cautionary Tales of Business Pioneers Who Tried to Do Well by Doing Good. And it’s telling that these are cautionary tales. Many begin with good intentions, but the recurring pattern is a failure to deliver a reliable model for doing good in a way that aligns with doing well. The stories need a book to relate—for now we’ll have to skip to 1970.

This was the year when conservative economist Milton Friedman published his influential New York Times article arguing that the only social responsibility of business is to increase its profits—a position broadly defined as shareholder capitalism. In the other camp, you had people like Klaus Schwab, founder of the World Economic Forum, who argued for stakeholder capitalism—the idea that businesses should exist to serve a wider set of stakeholders in society, ultimately including everyone if you consider we all have to share the same planet.

Again, you can see the appeal of the stakeholder idea. But it gets hazy the further you look into it. In what sense are any of us really stakeholders in, say, Unilever or Procter & Gamble? We don’t have any stake in the sense of a vote or financial interest. We don’t receive any salary or dividend. No one checks with us about any decisions made, and there are no rules about which stakeholders matter most when conflicts of interest inevitably arise. Instead, CEOs are able to claim the moral authority of ‘stakeholders’, without being answerable to any of them.

The back story matters because much of the purpose debate is a reframing of the shareholder / stakeholder capitalism debate from years gone by. The word ‘purpose’ only emerges post-2008. (I used the phrase ‘brand purpose’ for this Google search, because ‘purpose’ and ‘social purpose’ arise in too many other contexts to be a useful guide. But this at least gives a sense of when it became a corporate buzzword.)

What caused that spike around 2010? Well, all this came shortly after one of the most shattering financial events in living memory—the collapse of Lehmann Brothers and the global crash of 2008.

You may remember this was an interesting time for the reputation of big business. For a brief period, Occupy Wall Street represented a significant threat to corporate power. People of many ages and backgrounds united around a shared economic interest: the 99% versus the 1%. And beyond Wall Street, the reputation of business in general was in the doldrums. In my copywriter role, I remember encountering many briefs that were specifically designed to tackle this reputational crisis.

Purpose emerged as the answer. It offered businesses a new story to tell. Not only were they not the bad guys, they were actually the good guys. Rather than representing a threat to progressive social causes, their purpose was actually to further those causes.

Fast forward a few years and the protestors have disappeared from Wall Street. In their place comes Fearless Girl, a statue created by ad agency McCann Erickson on behalf of asset management firm State Street. By this time, purpose had helped shift the conversation away from more uncomfortable economic issues and onto identity issues—important in their own right, but less threatening to corporate power. And the reaction was ecstatic. The campaign won 18 Cannes Lions and two rare D&AD Black Pencils. A few years after Occupy Wall Street, one of its occupants was now hailed as a moral hero, firmly on the right side of history.

Even at the time, the reality was more complicated. Shortly after the awards flooded in, State Street paid a $5m out-of-court settlement to female employees over claims of systemic pay inequality in previous years. To this day, the company is in litigation with the female sculptor, who claims her creative freedom and intellectual property is being unreasonably restricted by State Street. As is often the case, the gap between feel-good story and everyday reality is stark.

That one story is an illustration of how the tide turned in the 2010s, with business latching onto a seductive narrative that was too good to be undermined by mere facts. When preposterous outcomes followed, such as Kendall Jenner defusing police protests with a can of Pepsi, or Cannes awarding a fake app to find migrants lost at sea while the ad industry celebrated on the shore, it was easy to dismiss such stories as bad apples that didn’t represent ‘proper’ purpose. When purposeful giants like WeWork and Theranos turned into epic tales of corporate malfeasance, it was possible to sigh and say this makes the case for ‘real’ purpose even stronger. When dubious attempts were made to prove the commercial effectiveness of purpose, the patient debunkings invariably got less attention than the initial claims.

Meanwhile, the meme of purpose had spread beyond marketing departments and into the highest levels of corporate management. From 2017 onwards, Larry Fink’s annual letters to CEOs took on the status of Vatican smoke signals, unequivocally proclaiming that any business wanting a share of its $10 trillion in assets under management would need to sign up to the purpose credo. In 2019, 150 leaders of the US Business Roundtable signed a Statement on the Purpose of a Corporation. A subsequent study showed few of them had changed anything substantial in their corporate by-laws or internal practices, and concluded that the 150 businesses represented were slower, not faster, to react to the social uproar that followed the death of George Floyd.

All of which is a quick summary of a story that needs longer to tell. For now, it’s enough to say that purpose came to dominate the business and marketing landscape in the 2010s. It has been the establishment view for at least a decade and is deeply institutionalised across industry bodies and creative universities (now run to a purposeful agenda). In the next post, I’ll make the case for why that is bad news for marketing, and even worse news for society.

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Thanks for reading. By the way, the image at the top is El Greco’s painting of Christ driving the traders from the temple—I’ll explain why I chose it in part 3.

For anyone new here, I’m a writer of poetry, downbeat diaries, branding and advertising projects, articles for Creative Review and The Guardian, books about design, and occasional songs. Thoughts on Writing uses language as a way into wider cultural and political issues.

1. Some like to talk about ‘commercial purpose’, or try to make out that purpose was a good branding idea that somehow got hijacked by ‘social purpose’. The latter is a historical misreading, as I hope this post shows. I understand the impulse behind the former, but commercial purpose is synonymous with the profit motive, so it’s a distinction without a difference. To avoid confusing the wider debate, I’d rather people used an old-school word like ‘proposition’ instead of commercial purpose. It shares a similar Latin root to ‘purpose’ and was always a more honest and grounded word for what brands offer—you could call it a reason for buying rather than a reason for being.