David Jones, global CEO of power ad agency Havas, is among the youngest CEOs in advertising, and among the industry's most innovative and best connected. He was a key adviser to David Cameron's successful 2010 campaign for UK Prime Minister. He's also the founder of One Young World, an annual summit that brings young people together from all over the world to try and address the world's global challenges. All this might explain why he's been bullish on social business and optimistic about the power of social media. I first met David Jones at the One Young World summit in Zurich where I saw these principles in action. I recently spoke with him about Who Cares Wins and his overall argument that holds that in the 21st century, businesses need to "do good" and "do well" in order to survive and thrive.
You say in the book that we are now in the "age of damage" with respect to the impact that social media and social responsibility have on companies. How far into the "age of damage" are we and what does this mean for global corporations?
I think we're at the start of it. If you do not behave in the right way, the public, empowered by social media, will take you down. Whether it's the CEO of BP or the head of an Arab country, now people can hold you accountable. It may be covert punishment with individuals deciding not to buy a certain product or it may be overt public protest against a company. For the millennials, I think this is obvious. But if I go talk to a bunch of 60-year-old CEOs, they think I'm a mad man, who doesn't understand business or the way the world works. The biggest change we are seeing is that some of the biggest businesses are taking social responsibility seriously. Now huge global companies like Unilever and Walmart have embraced this movement. Given their footprints, that has a huge impact.
What can be the extent of the "damage"?
Well look at BP: The CEO lost his job and their share price dramatically underperformed their competitors after the oil spill. Yet change is coming. I think now the company that is the most obsessive about what they're doing around the world in that industry is BP. They have begun to learn the lesson.
OK, but BP arguably had to start doing good or at least appearing to do so. What about companies that are not in crisis?
There is still advantage to be had. For instance, Patagonia created an eBay channel to allow people to sell secondhand Patagonia clothing. Their advertising campaign actually says "Don't buy this jacket. If there's someone out there who doesn't have a Patagonia jacket, go buy it for them." They get no money out of that but they get people looking at that campaign and saying "That's really good. Imagine how sustainably they must source their product. Imagine how much they must care about the environment. That's a good company. I want to buy from them." So they'll do better because of they've planted those seeds in the minds of customers who already admire their products. This is all happening because consumers today, and in particular millennial consumers, want business to stand for something more than just profit. This generation is not anti-business. They don't have a problem with businesses making money. But they believe business can make money in the right way. I believe it will become increasingly hard to make money unless you behave in the right way. The new price of doing well is to do good.
Will we see businesses actually fail as a result of not embracing this new ethos?
I think we absolutely will. If these trends can topple powerful leaders of countries, they can remove the leaders of businesses.
There are some parallels between Arab Spring and this new business movement. But one of the key differences is that in the Arab Spring there a sense of urgency and a clear mission to accomplish. How do you replicate that in business?
I'm not saying that social media is the cure for all the ills of the world. But it's a major force that's giving people a voice that they didn't used to have. Twenty years ago, if an individual didn't like the way someone behaved, yes they could stage a protest or bring a legal action but that was complicated and time consuming. Now, one person can very quickly create a mass movement. Social media has empowered people to take down leaders but it doesn't' create leaders. What is missing in Egypt is a leader who has come along and said, "Okay here's where we're going." The Occupy movement is another example of that, they've generated great awareness but what is the tangible goal? The visibility of these kind of movements provides ample illustration of the power of social media, but these experiences also show we still need leaders.
What would have to happen for people to push back against the social business movement?
I think the biggest threat to the social business movement is the banking and finance sector. People want businesses to be more socially responsible. Many of the world's business leaders understand that and are trying to make their businesses more socially responsible, and even some political leaders are starting to act. However, the finance world still remains relatively short-term focused and cynical about this concept. If they don't fundamentally change their behavior, and if in five or ten years some of the CEOs who have been leaders in social business are not doing as well as their more profit-focused competitors, that could unhinge the movement. I don't think that will happen. There's increasing evidence that the more sustainable and more socially responsible businesses are seeing strong gains in their share prices. Havas did a study which found that the companies that people thought were the most socially responsible are actually outperforming the S&P 500.
How can big companies go about integrating social responsibility into their operations? How much must they do to be considered genuinely socially responsible?
There was a bank in Europe who ran a campaign with the slogan: "it's time for greener banking." It got panned because while it is time for greener banking, it turned out that this bank wasn't doing any of it! Companies need to place social business at the core of their business strategy rather than in a silo. It has to be more than having a director of corporate responsibility or writing a check to charity at the end of the year. Genuine commitment to "doing good" is one of the most important things for business leaders to understand in the next decade. There is also a generational difference. If you look at Bill Gates and Warren Buffett, they made all of their money first, then started giving it away. That's not to undermine the impact of their philanthropy, which has been tremendous. But many of the most prominent millennial entrepreneurs are making money without that being the focus of their careers. If Mark Zuckerberg had set out to make money, Facebook would probably be a niche social network at some Ivy League colleges in North America. It would never have become an 800 million person platform. It's became a global platform because he didn't try so hard to make money from it. In the prospectus for the Facebook IPO, Zuckerberg says that Facebook doesn't make services to make money, they make money to make their services better.
Why are we seeing millennials playing this role both in business creation and in their enthusiasm for "doing good?" What's different about this generation?
At every point in history, the world is obsessed with youth. But I think this is the first time the world's younger people actually understand more about the world than the world's older people do. They've been given more access to information than any previous generation. They're the smartest generation. Because of this access to information, they see the problems in the world more clearly. They are emerging as the most socially responsible generation that's ever existed. Most importantly, they understand more about the digital and social revolution that's changing the world than anyone else. We did a global study which found that 84 percent of the members of this generation believe that it's their generation's duty to change the world for the better and 85 percent of them believe that they can. They see the problems, they're smart, and they get how to use technology and social responsibility, including on the part of businesses, to affect change.