Use Your Ethics to Drive Your Innovation

In 1959 Nils Bohlin, an engineer at the Swedish Car Manufacturer Volvo, invented the first three point safety belt. It was much more effective than the standard lap belt (as still used on airplanes). Volvo, realising the importance of this invention, chose not to patent it but to share the idea with other vehicle manufacturers. They may have lost some revenues but their action undoubtedly saved many lives and it cemented Volvo’s reputation as a highly ethical company committed to safety.

In the 1970s Anita Roddick founded the Body Shop. She deliberately chose a radically different approach from other vendors of cosmetics and toiletries. The Body Shop’s products were shipped in cheap clear plastic bottles with an emphasis on simplicity, sustainability and fair trade. The retail chain differentiated itself by stating that it would never use animal testing in its product development. The Body Shop grew rapidly. It used social and environmental campaigns to promote its business. In 1997, Anita Roddick launched a global campaign to raise self-esteem in women and to oppose the media stereotyping of women.

A modern day example of this approach is provided by the clothing manufacturer, Patagonia. They caused a stir with a Black Friday advert saying, ‘Don’t Buy our Product.’ In an interview in Fast Company their CEO, Rose Marcario, explained, ‘What it was really saying was, “Don’t buy more than you need.” The more you consume, the more strain you put on the Earth’s resources. We don’t want that because we all care about this nest we’re in. We put out a film, Worn Wear, which celebrated the durability of our product, the fact that it can be handed down from generation to generation and the fact that you can bring it back to us and we’ll repair it.’

Patagonia recently invested $13m of tax credits in installing solar panels in homes in Hawaii. They financed an outspoken political film, Damnation. It is a documentary which condemns the environmental impacts of the Chinese government’s actions in damming so many rivers.

Rose Mercario has practiced Shambhala Buddhism for many years. In 2010 she organized a group of employees to provide relief in the Gulf of Mexico after the oil spill. Patagonia has a company policy of sharing product material innovations with competitors. Mercario’s creed is ‘I really believe that business can be an agent for change in the world.’ This approach may look like soft-hearted sentimentalism but it has led to a loyal customer base, growth in sales and profits and, most importantly, enormous respect. This will be invaluable in their new venture, Patagonia Provisions, a company supplying sustainable food products. Just don’t buy more than you can eat.

Many firms are seen by consumers as greedy and profit focused. What Volvo, the Body Shop and Patagonia show is that high moral values can provide a source for innovation. They can give a clear point of differentiation, a better image and a business advantage.

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Paul Sloane writes, speaks and leads workshops on creativity, innovation and leadership. He is the author of The Innovative Leader and editor of 'A Guide to Open Innovation and Crowdsourcing', published by Kogan-Page. Follow him @PaulSloane - See more > here