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Lesson #1: Business Benefits When You Behave Responsibly
Today, Ben & Jerry’s has become famous not only for its unique and delicious flavours of ice cream, but also for the path the company took to achieve its success. From day one, the two childhood friends knew that they wanted to build a different kind of business, one that approached social responsibility with serious commitment. With a business model that incorporated the principles of corporate social responsibility, Ben & Jerry’s demonstrated that significant growth is possible even when a company looks beyond profits in view of the public good.
“Business can be a source of progressive change,” says Greenfield. “When you are led by values, it doesn’t cost your business, it helps your business.” It was with this goal in mind that Ben & Jerry’s first pledged not to receive cream used in their products from any farmers that used Bovine Growth Hormone. Similarly, the company committed itself to only using eggs from hens that had not been confined in battery cages. All packaging of Ben & Jerry’s products is also made from recycled, bleach-free paper and all ingredients are certified as “all-natural”.
And, those were only the in-house steps the company took towards creating a responsible business. “If we were going to have a business we were going to have one that was consistent with our values,” says Cohen. “We measured our success not just by how much money we made, but by how much we contributed to the community. It was a two-part bottom line.”
Ben & Jerry’s established the Ben & Jerry’s Foundation to fund community-oriented projects and also partnered with organizations such as the World Wildlife Fund, with whom they launched the Climate Change College. 7.5 percent of the company’s pre-tax income is donated directly to the Ben & Jerry’s Foundation. From sending a percentage of its ‘Rainforest Crunch’ ice cream sales to rainforest conservation efforts in Brazil, to using ingredients from companies that employ and empower disadvantaged people, Ben & Jerry’s has constantly looked for ways to make a positive contribution to the community.
“Business has never had improving the quality of life of the general public as one of its priorities,” says Cohen. “We decided to redefine the bottom line at Ben & Jerry's.” And, just how successful was that bottom line? Did the company suffer financially in order to achieve its stated social activist aims?
In 1991, dairy farmers throughout the state of Vermont – the home of Ben & Jerry’s – were suffering large losses due to volatile prices in the industry. The company decided to pay a dairy premium of half a million dollars to the family farmers from whom Ben & Jerry’s got their milk. Against conventional wisdom, total sales that year reached $97,000,000, a 26 percent increase from the year before.
“The prevailing wisdom is that you can’t have a successful business and use it to help society as well,” says Greenfield. “We added value to the company by doing business the way we did it…If you support the community, the will support you.”
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