Redefining Success: The Better Business Act Paves the Way for a New Era

In the realm of business, the pursuit of profit has long been regarded as the ultimate measure of success. But as we stand at the precipice of change this Better Business Day 2024, it’s evident that the traditional paradigm of ‘business as usual’ is no longer sustainable. The relentless focus on immediate returns for shareholders has exacted a heavy toll on both people and the planet.

Enter the Better Business Act – a beacon of hope amidst the sea of corporate conformity. This groundbreaking legislation seeks to realign the interests of companies with those of society and the environment. At its core lies a simple yet revolutionary idea: shareholders should no longer reign supreme. Green Orbit Digital has recently signed up to support the Better Business Act, which calls for every company in the UK to align the interest of their shareholders with those of wider society and environment.

The genesis of the Better Business Act can be traced back to Westminster in April 2021, where a diverse coalition of business leaders, MPs, and advocates converged to challenge the status quo. Central to its mission is an amendment to Section 172 of the Companies Act, which would empower directors to prioritise social and environmental impact over shareholder interests when the two come into conflict.

“In situations where a director has to choose between the company’s intention to create positive social or environmental impacts and the interests of shareholders, the directors would no longer be compelled to default to prioritising shareholders.”

Better Business Act

The rationale behind this seismic shift is clear: ‘business as usual’ has failed us. From climate change to income inequality, the repercussions of prioritising profit above all else are plain to see. Yet, amid the chaos, a glimmer of hope emerges – a groundswell of public support for businesses that do good in the world. According to recent polls, three-quarters of the UK public believe that companies have a responsibility to protect the environment, while a majority favour brands that embrace social responsibility.

Indeed, the Better Business Act has struck a chord with companies across the spectrum, with over 600 organisations pledging their support. From household names like John Lewis and Iceland to innovative startups and industry associations, the momentum behind this movement is undeniable. But perhaps the most compelling aspect of the campaign is its emphasis on stakeholder capitalism – the notion that businesses should serve not just their shareholders, but also their employees, customers, communities, and the environment.

As one advocate eloquently puts it, “Until shareholders care about employee engagement, we will continue to struggle to build trust.” This sentiment underscores the urgent need for a paradigm shift in how we define and measure success in business. No longer can profit be the sole metric of prosperity; instead, we must embrace a more holistic approach that considers the impact of our actions on all stakeholders.

For many companies, this shift in mindset is already underway. From embedding purpose into their culture to reimagining their business models for the 21st century, forward-thinking organisations are leading the charge towards a more sustainable and inclusive future. And with the Better Business Act on the horizon, the time has never been ripe for change.

Of course, transforming the way we do business won’t happen overnight. It will require a concerted effort from companies large and small, as well as support from policymakers, investors, and consumers alike. But as history has shown, the most profound changes often begin with a simple idea – a belief that a better world is possible, and that together, we can make it a reality.

So let us embrace the spirit of the Better Business Act – not just as a legal obligation, but as a moral imperative. Let us redefine success not in terms of profit margins, but in terms of our impact on the world around us. And let us dare to imagine a future where business is not just a force for profit, but a force for good.

If you’re inspired to join the movement, I encourage you to visit the Better Business Act website to learn more. Together, we can build a brighter, more sustainable future for all.