RISK: When good deeds are great business

This article first appeared in Canadian Business.

Tal Dehtiar was interested in more than just starting a shoe business when he founded Oliberte in 2009—he wanted to initiate lasting positive change.

“My goal was and is to create a multi-generational opportunity for jobs even after I’m six feet in the ground,” says Dehtiar, 35, CEO of the Oakville, Ont.-based company.

Dehtiar is part of a growing number of entrepreneurs who are just as concerned with improving social or environmental conditions as they are with the bottom line.

Oliberte sources materials for its durable leather shoes from sub-Saharan Africa and manufactures in Ethiopia, with a special focus on local workers’ rights. The company was the first Fair Trade Certified footwear manufacturer in the world.

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Other Canadian companies, such as Nude Bee Honey and Canada Goose, have also baked social consciousness right into their business models. Nude Bee Honey works with beekeepers from around the world to preserve ecologically important bee hives, while Canada Goose allocates funds from the sale of every parka from its PBI Collection line to support the conservation of polar bear habitats. The outerwear company also pays for quarterly shipments to eight communities in the Arctic, supplying free fabrics, buttons, zippers and other materials to Inuit sewers, who hand-make jackets and clothing for their families and neighbours.

Kevin Spreekmeester, chief marketing officer at Canada Goose, and Dani Reiss, CEO and grandson of company founder Sam Tick, were inspired to create these pop-up resource centres on a trip to Canada’s North.

It’s easy for a company to donate money to a good cause or to sponsor a charitable event, but to have true impact, companies serious about social or environmental change need the buy-in of staff.

Canada Goose recently started “cutting parties” for its charitable work. “We invite employees to the warehouse to help us cut ends of lines into pieces of fabric that can be folded and shipped more efficiently,” says Spreekmeester. The workers volunteer and come in after-hours. “We give them pop and pizza.”

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Ryan Thomas and Edward Okun of Nude Bee Honey consider their business an opportunity to participate in the global conversation about food management and agriculture, as well as in bee preservation. “We don’t want to come across as saints trying to save the world, but ultimately we want to feel good about what we’re doing,” says Okun.

Dehtiar, Taylor and Okun all founded their businesses, while Reiss is a third-generation CEO. All of them moulded their companies’ benefit mandates as entrepreneurs, but their social responsibility hasn’t proven to be a turnoff for outside investors. Canada Goose’s activities in the Arctic made them more appealing when private equity firm Bain Capital wanted to invest, Spreekmeester says. “On a day-to-day basis, nothing has changed,” he says. “One of the reasons Bain are good partners is that they said, ‘You guys have grown 2,000% over the past 10 years—we’re not going to mess with that.’ They understand we’re not a traditional marketer.”

To help ensure Oliberte’s social mandate remains intact, Dehtiar had the company certified as a B corporation. The “B” is for “benefit,” and any company with the certification must “meet rigorous standards of social and environmental performance, accountability and transparency” set out by B Lab, the organization that oversees the designation. All of this makes for a great story to tell investors and consumers alike, but the business owners agree the tale should never outshine the product.

“At the end of the day, we’re a shoe company,” says Dehtiar. “If they’re only going to buy our shoes because we pay a fair trade premium to our workers or because they’re made in Africa, then we’re never going to succeed.”

This story was originally published by Canadian Insurance Top Broker.