Enlightened Self-Interest: The New Business Imperative

Acting and leading with enlightened self-interest is becoming a business imperative in the twenty-first century for two key reasons.

First, the world has become so complex that a leader no longer has all the capabilities or the resources to create all the products and services that customers want. To be effective, leaders need to find partners. In a survey conducted by IBM in 2012 with seventeen hundred CEOs, 70 percent of them indicated that extensive partnerships are critical for the long-term success of their organization.¹¹ Yet to orchestrate these partner networks effectively, leaders need to rein in some of their own self-interest. Indulging in competitive zero-sum games doesn’t work in an interdependent partner relationship: leaders must devise win-win strategies that create value to all of their partners as well.

Second, the values and expectations of a growing number of customers and employees are shifting: they prefer to buy products from and work for companies that are motivated by a purpose beyond financial gain. For instance, 70 percent of the consumers surveyed by the public relations company Burson-Marsteller indicated their willingness to pay a premium for products and services provided by socially responsible companies that invest, among other things, in environmental protection initiatives.¹² Such socially responsible companies include the Tata Group, Whole Foods Market, Panera Bread, and Better World Books (featured in chapter 8), along with several hundred B Corporations (a new type of corporation that uses the power of business to create public benefit) and thousands of social enterprises, all of them using a noble purpose as their North Star to guide their businesses. Jim Collins and Jerry Porras, the best-selling coauthors of Built to Last, found that organizations that are driven by a noble purpose outperformed the general market by fifteen to one and outperformed their industry peers by six to one.¹³ Collins believes that a noble purpose has “the power to ignite the passion and commitment” of a company’s employees, customers, and partners alike.¹⁴ In this chapter, we explore how smart leaders can shift their motivation beyond self-interest to serve this larger purpose.