From the July 1997 issue of Entrepreneur

Editor's note: This is an excerpt from Ben & Jerry's Double-Dip, the forthcoming book by Ben & Jerry's founders Ben Cohen and Jerry Greenfield.

Ben: When we go out and speak to business groups, people ask what we mean by "values-led business." Sometimes they ask if we're talking about hippie values, or what. We say, "It's more like biblical values."

Jerry: Do unto others as you would have them do unto you. As you give, you receive. Or, to put it in a more "businesslike" way: one hand washes the other.

Ben: When you're values-led, you're trying to help the community. And when you're trying to help the community, people want to buy from you. They want to work for you. They want to be associated with you. They feel invested in your success.

Jerry: This isn't conventional business wisdom. It's Ben's business wisdom. But it works. That's one of the beautiful things about Ben. He questions everything, particularly conventional wisdom.

In The Beginning

When we started making ice cream in 1978, we had simple goals. We wanted to have fun, we wanted to earn a living, and we wanted to give something back to the community. Only we didn't really know what that last item meant.

Then, as the business grew, our aspirations grew as well. We wanted to create a company we could be proud of. In order to do that, we had to find an alternative to the traditional business model. What evolved from that search is what Anita Roddick, founder of The Body Shop, called "values-led business."

Values-led business is based on the idea that a business has a responsibility to the people and the society that make its existence possible. More all-encompassing and therefore more effective than philanthropy alone, a values-led business seeks to maximize its impact by integrating socially beneficial actions into as many of its day-to-day activities as possible. In order to do that, values must lead and be right up there in a company's mission statement, strategy and operating plan.

Let's say, for example, that we're looking at three possible new ice cream flavors. Being values-led means choosing the flavor that gives us the best opportunity to integrate our commitment to social change with the need to return reasonable profits to our shareholders. Assuming all three flavors are profitable, if we find out that we can make one of them using nuts from the rain forest (in order to increase economic demand for the living rain forest) and we can put the ice cream in a rain-forest-themed container that raises awareness about the problem of rain-forest deforestation, we would choose that flavor. (That's exactly what happened with the development of our Rainforest Crunch flavor.)

By incorporating concern for the community--local, national and global--into its strategic and operating plans, the values-led business can make everyday business decisions that actualize the company's social and financial goals at the same time. Instead of choosing areas of activity based solely on its own short-term self-profitability, the values-led business recognizes that by addressing social problems along with financial concerns, a company can earn a respected place in the community, a special place in customers' hearts, and healthy profits, too.

Consumers are used to buying products despite how they feel about the companies that sell them. But a values-led company earns the kind of customer loyalty most corporations only dream of--because it appeals to its customers on the basis of more than a product. It offers them a way to connect with kindred spirits, to express their most deeply held values when they spend their money. Unlike most commercial transactions, buying a product from a company you believe in transcends the purchase. It touches your soul. Our customers don't like just our ice cream--they like what our company stands for. They like how doing business with us makes them feel. And that's really what companies that spend huge amounts of money on advertising are trying to do--make their customers feel good about them. But they do it on a superficial level, with sexy women and cool cars.

For A Good Cause

Over the past fifteen years, the success of Ben & Jerry's and other values-led companies has proved that there are plenty of customers who, when given a choice between products of equal quality, prefer to spend their money with companies whose values they share. Consequently, the idea that business should give back to the community started to seem less bizarre, and a lot more appealing, than it did when we were getting started. During the mid-'80s, the concept of "cause-related marketing" entered the mainstream corporate world.

Consultants started selling cause-related marketing campaigns to big corporations. Hershey's put Treats for Treatment coupons in Sunday newspapers and gave money to children's hospitals in exchange for each coupon redeemed. MasterCard started donating money with each transaction to anti-child-abuse organizations. Geo gave a fleet of fuel-efficient cars to TreePeople, a tree-planting group in Los Angeles, and planted a tree for each new car sold.

Cause-related marketing is a positive step. But it doesn't deal with the basic paradigms of conventional business and conventional marketing. It acknowledges that business has a responsibility to give back to the community, but it doesn't take advantage of the fact that the real power of business lies in its day-to-day activities. So a company that's doing cause-related marketing operates from a traditional, exclusively profit-maximizing motivation--then adds a charitable component almost as an afterthought. Instead of giving products a boost by using a half-baked woman in a multimillion-dollar advertising campaign, cause-related marketing gives products a boost by associating them with compelling causes.

The basic premise of values-led business is to integrate social values into day-to-day business activities--into the very fabric of the business and its products. By contrast, the basic premise of cause-related marketing is to tack social values onto the marketing campaigns of a business that does not take social values into account in its other business activities.

At its best, cause-related marketing is helpful in that it uses marketing dollars to help fund social programs and raise awareness of social ills. At its worst, it's "greenwashing"--using philanthropy to convince customers the company is aligned with good causes so the company will be seen as good, too, whether it is or not. Corporations know if they create the perception that they care about their consumers and the community, that's likely to increase sales. They understand that if they dress themselves in that clothing, slap that image on, that's going to move product.

But instead of just slapping the image on, wouldn't it be better if the company actually did care about its consumers and the community? Wouldn't it be better to actually do things that benefit people and society? That will also sell product--as well as motivate customers, employees and investors. And in most cases it doesn't cost any more. As a matter of fact, it may cost less.

Setting Priorities

Values-led business recognizes that the greatest potential a business has for benefiting society is in its operations--not in giving a small percentage of profits from its bottom line to charitable organizations.

Values-led businesses need to be public about their social activities. How can people know which companies to "vote" for if companies are secretive about their social stands and activities? When business acts covertly, it locks people out of the process. It deprives consumers of the opportunity to use their purchasing power to support the social goals they believe in.

You have to be firm in your resolve that being values-led is key to the success of your business, just as much as other essentials. Otherwise you'll find your values get sacrificed in a trade-off. As with most business decisions, each case is a judgment call. Sometimes you sacrifice short-term sales to advance your social mission; sometimes advancing your social mission drives sales. You don't know how it's going to work out until you try.

Business, like life, is full of trade-offs. Do you spend money to promote this new product, or that social cause? Do you allocate people to this project, or that one? If your social objectives aren't seen as an essential part of your business--like price and quality--chances are very good they'll be the first to go in a trade-off.

In order to take care of its social responsibility, a company needs to put its social mission right up front. Values are either a forethought or an afterthought. There's no middle ground. In order to get values in the right place--in order to maintain the balance between your social mission and your financial mission--they have to start out in first place.

Working It Out

Understanding what it means to be a values-driven company has been an ongoing process at Ben & Jerry's. When the two of us started scooping ice cream in an abandoned gas station, we hadn't given much thought to business, let alone its role in society. We envisioned ourselves having a homemade-ice-cream parlor that we'd run for two or three years until we moved on to something else. Calling our business Ben & Jerry's, giving away ice cream, holding free movie festivals, doing things that were community-related were just honest, true expressions of ourselves.

Later, we consciously undertook an experiment: to find ways for a corporation to impact society positively. We dedicated ourselves to the creation and demonstration of a new corporate concept, of linked prosperity. We're constantly in a process of clarification, of improving what we're doing. But we do agree on one central point: The impact of business is so far-ranging and all-encompassing that we can't shirk responsibility for societal concerns. Incorporating that responsibility into a business can make that business a powerful, positive force for social change.

A values-led business is still a business. You can't always be nice to everyone. You have to make rules, make tough decisions, prioritize the things you want to do. But if you're thrown into the chair, you can choose to be the same person you always were. You don't need to put on a suit and tie if you'd rather wear a T-shirt. You don't need to hire an ad agency if you want to tell your own truth. You can choose not to believe the so-called conventional rules of business, to trust your own reasoning and beliefs instead of--or along with--soliciting advice from lawyers, accountants, and other businesspeople. You can still lead with your values, even when the experts tell you what they told us so many times: "Nobody's ever done that before. You'd be crazy to do that. It won't work." But just because something's never been done doesn't mean it never can be.

We know the world won't change overnight. What we're talking about here is taking small steps. The important thing is to take them in the right direction--and in the company of a lot of good people.

Contact Sources

Business for Social Responsibility is an organization that promotes sustainable business practices. Write to them at 1030 15 St. N.W., #1010, Washington, DC, 20005.

  • Social Ventures Network assists entrepreneurs who are seeking ways to combine principles and profits. Write to them at 1388 Sutter St., #1010, San Francisco, CA 94109, or visit their Web site at www.svn.org.
  • The Soul of a Business: Managing for Profit and the Common Good (Bantam) by Tom Chappell and Seventy-Five Best Business Practices for Socially Responsible Companies (Jeremy P. Tarcher) by Alan Reder reveal proven techniques for companies interested in promoting social responsibility.

Copyright 1997 by Ben Cohen and Jerry Greenfield. From the forthcoming book Ben & Jerry's Double-Dip, by Ben Cohen and Jerry Greenfield, to be published by permission of Simon & Schuster Inc. Printed by permission.