Utility, a key concept for moving companies towards a sustainanble model
The company of tomorrow will have to demonstrate its usefulness, even more than its responsibility. And it is through collective work to meet essential needs and share value that the company affirms its usefulness for society. To build and assert this utility, the company must definitely think of itself as a political actor. In fact, the question posed by the SDGs is not only the measurement of each one’s contribution to the goals, but the ability of all actors to forge the necessary cooperations to meet the needs of society.
The multiplication of expectations towards companies
The notion of utility is both a philosophical and economic concept. It originates from Maslow’s hierarchy of needs, which does not directly address the topic of companies but conditions utility on the satisfaction of a number of hierarchized needs. Adapted to companies, it leads to integrating needs of different natures to those traditionally accepted, to define utility.
Maslow’s theory is a starting point for the notion of utility in companies and is intended to occupy a special place in the face of the emergence, within our societies, of other types of needs than material/primary needs, namely:
- Immaterial needs
- The concept of social utility
- The concept of individual and collective impacts of companies’ activities
The notion of utility is now emerging more strongly in view of the multiplicity of expectations towards companies and the climate emergency. It joins the concept of “stakeholder companies” or “stakeholder capitalism”, which strongly raises the question of the societal utility of companies.
Rehtinking the relationship between companies and Society : from supplier to active player
For a company that would decide to appropriate and bring to life the concept of “social utility”, priorities should focus on understanding society’s expectations, recognizing the legitimacy of civil society and communities to address it, and promoting a partnership culture (stakeholder relations) to meet the expectations and requirements of our times. More broadly, it is a matter of acknowledging that the company is a decidedly political actor.
The notion of utility fits within the logic of the United Nations Sustainable Development Goals (SDGs). The question posed by the SDGs is not only the measurement of each individual’s contribution to the goals but the ability of all actors to establish the necessary cooperation to meet the needs of society.
It is through this collective work for the satisfaction of essential needs and shared prosperity that the company affirms its utility for society.
From absolute value to shared value
For tomorrow’s societally and inclusive company, it is not responsibility that comes first, but social utility, plural performance, and shared wealth. The company must be prosperous to endure, but prosperous for all and not just for a few. This is not only the challenge of the equitable distribution of wealth created but also the concept of plural performance (which implies the necessary “impact measurement” to assess and demonstrate the company’s utility and its contribution to society and communities).
Taking into account society in the purpose of the company is the condition for its future legitimacy. And the concept of utility is fully in line with the expected evolutions towards sustainable models.