Updated: Oct 12, 2020
By Zachary Johnson, Ph.D.
January 24, 2020
- Small businesses are well-positioned to make a difference within their communities in ways that fit with their local focus or mission. We discuss a few ways that a small business can identify causes that fit with their mission and/or community focus through different forms of giving.
- To demonstrate their commitments and join communities of like-minded business owners, small businesses can join organizations focused on social change.
- We include perspectives from Stephen Distante (Chairman and Founder, Vanderbilt Financial Group and ImpactU.Film),Vincent Arena (COO, Tazetto Coffee), and Amy Lesnick (Chief Executive of Pledge 1%.)
*Republished in full on PledgeitForward
Your business is probably a small business: Most U.S. businesses (99.7%) are small business, (i) though small may be bigger than you imagined. According to the Small Business Association (SBA), a small food business can have over $40 million in revenue while a small telecommunications reseller can have up to 1,500 employees (ii). But when most people think of a small business, they imagine the 95% of businesses that have 9 employees or less.(iii)
Whichever definition of small you use, however, small businesses represent hubs of innovation that generate the majority of new jobs created in the U.S. (iv) and are well-positioned to make an impact within their communities in ways that fit with their mission or local focus. So how can your small business make a difference?
Small businesses can make a world of difference: There are many ways that your small business can create a big impact in the areas that matter to you. One approach that many businesses use is to look at the UN Sustainable Development Goals (SDGs). Built on decades of research and signed onto by all UN member states, the SDGs seek to make the world a better place through global, local, and people action (v). Given the depth of these goals, there is a high probability that the social impact you seek to make aligns to one of the 17 SDGs, which happen to be color-coded.
“Entrepreneurs are like artists and can use the SDGs as their color palette to decide how they'd like to impact the world. Choose 1 or a few SDGs to focus on and build your entire business around that”.
Along these lines, Mr. Distante is an SDG evangelist and serial entrepreneur. “At Vanderbilt Financial Group and ImpactU.Film, we focus on "Partnership for the Goals" (SDG 17) because we share the stories for these impactful entrepreneurs through film and use that to connect them to capital and investors who believe in the mission of their businesses.” ImpactU.Film’s interesting and effectively produced documentaries have been shared with entrepreneurs and students across the U.S.
Small and large businesses can demonstrate their social impact to the SDGs by making an official commitment to the framework. This involves annual reporting, integrating the SDGs within your business, and making a financial commitment to the UN SDGs which, at the time of this writing, ranges from $1250 to $20,000 depending on the size of your business.
Some socially responsible businesses may incorporate elements of the SDGs into their businesses, but in an informal way. The Long Island-based Tazzetto, seeks to systematically incorporate sustainability into their products and café operations. Chief Operating Officer Vincent Arena recently told me that “All of our products are either reusable, biodegradable, recyclable, or edible (our edible and tasty coffee cup)”. Mr. Arena also volunteers as Director of Climate Action Campaigns and Sustainable Development Programs at United Nations Association of Long Island. Through these activities, Tazetto unofficially engages in UN SDG goals related to clean water (SDG #6) and responsible consumption and production (SDG #12).
Accordingly, the UN SDGs offer a full framework for businesses of all sizes to make a difference. Another way to give back, however, is through Pledge 1%.
Pledge to give equity, time, product, or profit: As an alternative or supplement to the UN SDGs, some businesses make public commitments of their intent to make a difference through other external platforms. One good way of making your public commitment for social change is through Pledge 1%. Pledge 1% is a global movement that inspires, educates, and empowers every entrepreneur, company, and employee to be a force for good. Already, over 10,000 socially minded companies have made giving commitments through Pledge 1%. Pledge 1% asks companies to commit to giving back in one of or more of the following four categories (i):
Equity of a company, of a founder, or a combination of both.
Time through volunteering, training of others, or providing advice.
Product through giving away services, tech products, or tangible goods.
Profit though giving to organizations that matter to you and fit with your mission.
"We are proud to work with Profval on growing the Pledge 1% community and are excited to see another innovative company take the pledge and encourage other companies and leaders to do so as well.”
~Amy Lesnick, Chief Executive of Pledge 1%
How did ProfVal use this approach to build social impact into our business? For us, there was never a question about whether ProfVal would give back. Accordingly, we gauge ProfVal’s success along two core dimensions: i) our ability to deliver high-quality services to our clients built upon an architecture of research, and ii) our educational investments into the local, national, and international communities that we and our clients represent.
Our focus on education is likely unsurprising. We are a purpose-driven and professor-founded company. I became a professor in part because of the joy I experienced while volunteering at the high school I graduated from. After earning my PhD and becoming a professor, I have long viewed the production of new knowledge through research related to social responsibility (vii, viii, ix) and teaching as important ways of making the world a better place. Like the professors we work with through ProfVal.com, I believe that education has a transformative effect on people’s lives.
This idea is not novel. In 1848, the pioneering American educator Horace Mann stated:
“Education beyond all other devices of human origin, is a great equalizer of the conditions of men—the balance wheel of the social machinery.”
Unfortunately, however, education—and therefore opportunity—is unequally distributed. In fact, the educational attainment of economically disadvantaged students lags years behind children from wealthy families.(x) Differences in educational attainment along lines of wealth, race, gender, and other social and economic factors ultimately perpetuate inequality for future generations. Consistent with the approach we described earlier, education relates to one of the UN’s SDG goals (#4: Quality Education).
Following the approach that we suggested above, we made a commitment through Pledge 1% to formally demonstrate our commitment to integrating our social purpose into our business. Based on our commitment, we i) donate part of our profits to nonprofits that make a difference in education, ii) if our company is ever sold, part of the equity will be given to educational nonprofits, and iii) we provide discounts to clients that are registered nonprofits. Additionally, we match qualifying donations made by our clients to educational nonprofits through our giving site, profval.org.
In these ways, we have followed the giving approach that we suggest in this document. Our approach may not be the right one for you, but we hope it can help you to find an approach that fits for your company’s mission and/or local focus. Keep in mind that you or your company can make a difference in ways that matter to you.
© ProfVal, LLC 2020
ProfVal, LLC (profval.com) is a purpose-driven, professor-founded, and ethically-grounded provider of Expert Opinion Letters that can be used to support employment-based visas (H-1B, L1, EB, O). ProfVal is dedicated to helping clients through services built based on an architecture of research. ProfVal is dedicated to helping our communities through our giving site, profval.org.
Zachary Johnson, Ph.D. is the founder of ProfVal, LLC. He has over a decade of experience as a professor, academic researcher, academic program developer, and leader in academics. Through consulting engagements through ProfVal and otherwise, he has worked with members of the Fortune 500, startups, and nonprofits.
Stephen Distante is an entrepreneur and filmmaker. He is the Chairman & Founder of Vanderbilt Financial Group, a financial institution that provides state of the art technology along with socially responsible investment strategies that allow customers to align their investments with their social values. He is also a documentary filmmaker who shares stories of Entrepreneurs who use their businesses to make a difference in the world through the lens of the UN SDGs (Sustainable Development Goals). His films are created to Inspire, Educate and Celebrate fellow entrepreneurs for us all to consider our gift of entrepreneurship for good. www.ImpactU.Film.
Vincent Arena seeks to solve systematic problems with sustainable and value-centered design. He is the Chief Operating Officer of Tazetto Coffee, which is a pioneering a new café concept that perfectly blends authentic Italian coffees, food products, and traditions with a focus on sustainability and innovation. He is also the Director of Climate Action Campaigns and Sustainable Development Programs with the United Nations Association of Long Island. http://www.vincentarena.com
Pledge 1% (https://pledge1percent.org/) is a “global movement to create a new normal in which giving back is integrated into the DNA of companies of all sizes. Pledge 1% encourages and challenges individuals and companies to Pledge 1% of equity, profit, product, and/or employee time for their communities” (https://pledge1percent.org/overview.html).
vii. Johnson, Zachary, Huifang Mao, Sarah Lefebvre, and Jaishankar Ganesh (2019), “Good Guys Can Finish First: How Brand Reputation Affects Extension Evaluations,” Journal of Consumer Psychology 29(4), 565–83. (link)
viii. Johnson, Zachary, Yun Jung, Lee, and Minoo Talebi Ashoori (2018), “Brand Associations: The Value of Ability Versus Social Responsibility Depends on Consumer Goals,” Journal of Brand Management 25(1), 27–37 (link)
ix. Johnson, Zachary, Minoo Talebi, and Yun Yung Lee (2018), “Self-Reporting of CSR Policies and Impact: When Your Company Harms, Do You Self-Disclose?” Corporate Reputation Review 21(4), 153–64. (link)