Beyond the Cause: Understanding 3 Dimensions of Corporate Purpose

Learn about the three dimensions that corporations use to demonstrate corporate purpose with words and actions.

Three Types of Corporate Purposes

When most people think about corporate purpose, they tend to associate it with a cause—climate change, access to healthcare, and increased diversity being the most passionate concerns at present. So, they naturally assume that purpose-driven organizations will share in these concerns, as well. However, it’s important to note that corporate purpose is not necessarily tied to these hot-button issues. In fact, a Harvard Business Review article “What Is the Purpose of Your Purpose?” found that companies derive purpose on three levels— culture, competence, and cause. Here is a summary of the findings and some of the brands that are delivering on each type of purpose.

Exemplary culture

The distinct set of values, beliefs, behaviors, and day-to-day practices of a company define its corporate culture. All of these corporate modalities influence how employees interact with one another, with customers, and with the community. And it all manifests in a company’s personality and style, which, in turn, shapes the company’s image and reputation, whether intentionally or not.

“What differentiates a purpose-driven brand from a transactional brand is the intention—the underlying motivations,” Peggy Ang explains. She’s president and CMO, as well as a board member of Polar Electro, the pioneer of wearable sports technology. “I consider corporate purpose to be how a company thinks about itself and how it views its role in the marketplace and in the community. Your products and services will not differentiate you because they are easily replicated. What will define you is how you behave and how you show up with customers and in the community. A strong purpose helps a brand move from transactional to authentic.”

Exhibiting competence

A company’s unique skills, knowledge base, and expertise become the core competence they deliver to customers. By leveraging these strengths, the company becomes a purposeful leader in its industry.

Unisys relates its purpose to its long history of consistently delivering results and does it in two words: Experience Breakthroughs. Company senior vice president (SVP) and chief marketing officer Teresa Poggenpohl talk about the first word, “experience,” as a dynamic verb: “It is deliberate. We want to invite our clients and people to experience Unisys breakthroughs. That means helping them unlock a potential they couldn’t reach before. As for ‘breakthroughs,’ they can be big or small. It could be something simple and elegant, like a new, more efficient process for one of our clients. Or it could be game-changing like a quantum computing solution that optimizes logistics management.”

Championing causes

By shouldering the mantle of a social, environmental, or economic mission, a company demonstrates its commitment to making a difference. A company becomes a leader in advancing socially conscious policies and practices by becoming actively involved in larger societal initiatives, principally the Environment, Society, and Governance (ESG) and the Diversity, Equity, and Inclusion (DE&I) agendas.

These agendas, and others like them, are only the most visible avenues companies can take to make a genuine difference in our world. Equally valuable societal contributions are being made by companies when they step up for communities in need. Caterpillar, the construction, mining, and engineering equipment manufacturer, is a leader in this regard. As told by the company’s vice president (VP), head of marketing and brand, Yvette Morrison, “Your purpose has to be something more than just making a profit. And it has to be more than what you make or do. You need to go beyond mere product features and benefits and get to what difference you make in the world. It’s the only way to distinguish yourself from the competition because features and benefits are easily replicated.”

What Does It Mean to Be a Purpose-Driven Company?

To be clear, merely claiming a purpose doesn’t necessarily make a company purpose-driven. It’s easy to understand at face value that a purpose-driven company is committed to more than just making a profit. But in looking deeper into the machinery of establishing that company purpose, it becomes evident that a truly purpose-driven company has a crystal clear sense of its values and uses them to drive its decisions and actions. It focuses on that focus, as it were. At every level of the company, it answers the coupled question: What problem are we solving, or how would the world be worse off if we did not exist?

These purpose-driven companies tend to hold three tenets very dear:

First, purpose drives its marketing and communications activities and its overall business strategy. Purpose sets boundaries for what an organization will and will not do as part of its growth strategy. Purpose becomes the filter for evaluating strategic decisions, such as what markets to serve, where to make investments, how to hire employees, and, ultimately, why the business matters.

Second, purpose-driven companies effectively balance profit with purpose. They don’t resort to choosing one over the other but instead balance profit and purpose by focusing on creating shared value. They find opportunities to create societal benefits that also drive financial returns.

As we’ll see, purpose-driven companies tend to be more financially successful than non-purpose-driven counterparts in the long run. By creating value for all stakeholders, they effectively create a more resilient business model that is less vulnerable to short-term market fluctuations or changing consumer preferences.

Third, purpose-driven companies embed purpose in the organizational culture. Just like DNA provides a body with the information it needs to develop, a strong purpose guides employees on how to act appropriately by the corporate purpose—all with the goal of maximizing positive impact.

With these three tenets—driving business strategy, balancing profit with purpose, and embedding in the company DNA—purpose-driven companies are backing beliefs with conscious action—not just paying lip service but also taking action.

Mitch Duckler
Mitch Duckler is founder and managing partner of FullSurge, a brand and marketing strategy consultancy based in Chicago, Illinois. He has more than 30 years of brand management and management consulting experience at Unilever, The Coca-Cola Company, and Prophet. His client base includes Fortune 500 companies and numerous world-class brands, such as ExxonMobil, Deloitte, Cox Communications, Manpower Group, BlueCross & BlueShield, LexisNexis, Caterpillar, Abbott, and Hyatt Hotels. Mitch is also a frequent speaker on key topics related to brand and marketing strategy. In 2021, he delivered a TEDx talk—Discover Your Differentiator—at the Cal State-Fullerton TEDx event. Over the past 20 years, he has spoken at dozens of high-profile events across five continents and is a frequent interview guest on brand and marketing related podcasts. Mitch is a faculty member of the Association of National Advertisers (ANA) Marketing Training & Development Center, where he facilitates workshops for member organizations on key topics related to brand and marketing strategy. He also chaired the American Marketing Association’s (AMA) Annual National Marketing Conference for four consecutive years. Additionally, Mitch has written articles on brand and marketing strategy for top industry periodicals, including Branding Magazine, Brand Quarterly, BrandWeek, Marketing News, and Marketing Management. He is the author of the bestselling book, The Indispensable Brand (2019). His new book, The Future-Ready Brand: How the World’s Most Influential CMOs are Navigating Societal Forces and Emerging Technologies, will be released May 2024 by ForbesBooks.