There is such a thing as good growth
The unbridled pursuit of more can be irresponsible at best, and exploitative at worst, but the upcoming generation of entrepreneurs understands that growth isn’t just about enriching businesses, but enriching society, says Orlando Martins
It’s sensible for a business to seek to grow, if for no other reason than the lousy alternative: those that aren’t pressing ahead are generally falling behind. Growth is also validating for leaders, a sign that they’re doing something well.
Is it right to grow? That’s a more complex question. The unbridled pursuit of more, more, more can be irresponsible at best, and exploitative at worst. It can leave labour markets hollowed out, workers mistreated, the planet trashed, the climate ruined and inequality rife.
But that hardly means growth is all bad, or that all growth is bad. Every time a business innovates to create a new market or invests to scale production, they contribute to the economic growth that has rescued most of humanity from the mud in the modern era.
Since 1770, global life expectancy has risen from 29 to 70 years. Since 1990, the proportion of people living in extreme poverty – less than $1.25 a day – has fallen from 26 per cent to 14 per cent. Even in developed countries things are looking up. For example, despite the narrative of stagnation and the challenges of rising demand, British per capita healthcare spending nonetheless rose in real terms from £1,000 in the early 90s to £2,300 by 2015-6.
That’s not to say we should pursue growth as a necessary evil. There is such a thing as ‘good growth’ – growth that is self-consciously ethical, sustainable and inclusive – which not only enriches the business, but also enriches society, providing good jobs for the local community, funding vital public services and creating the dynamism to solve major problems like climate change and poverty.
It’s the kind of capitalism epitomised by the Cadburys and the Rowntrees of old, based on enlightened self-interest and doing the decent thing. I see a lot of it in Growth Index, the annual ranking of the UK’s fastest growing 100 private companies above £5m in revenue, which I founded three years ago.
It’s incredible to see what the brilliant entrepreneurs and growth leaders behind these businesses are doing. Between them, they have created about £14bn in new business over two years, some blazing a trail across sectors, others just executing with relentless quality.
But imagine if there were more of them. Imagine if all the most ambitious, resourceful, brightest people had the chance to live up to their potential. Imagine all the jobs they would create, all the problems they would solve, and if you’re governmentally inclined, all the taxes they would pay.
Democratising opportunity
In this year’s top 100, there were only three female CEOs, while 55 per cent of the businesses themselves were based in London.
For too long, we’ve been like a plane running on one engine, with opportunity limited for large sections of the population. To unleash the UK’s full potential we need to get the whole country firing.
Starting and scaling a business is always tough, but it is even tougher if you don’t know the rules of the game. Many potential entrepreneurs lack the family and social networks that provide business knowledge, experience and hacks that can make it easier to succeed. Furthermore, many don’t fit the cultural expectations of potential investors, banks and institutions.
The outcome is that only one per cent of founders receiving seed funding are black, the proportion for women is similar and according to Cornerstone Partners three-quarters of funded entrepreneurs come from higher socio-economic backgrounds.
As for London, it’s not a bad thing that the capital is a great place to start and scale a business, but not everyone is based there or will be in a position to move there. For opportunity to be inclusive, it needs to be everywhere.
I founded Growth Index to celebrate and champion our country’s most dynamic businesses, but I’m also trying to build it into a nationwide community where growth leaders can not only provide inspiration and support to each other, but also help those that don’t come from traditional entrepreneurial backgrounds to see that the near-impossible is in fact possible, no matter where you’re coming from.
Democratising opportunity is clearly a bigger problem than a few businesses can solve. But that’s the essence of good growth: doing what you can, where you can, knowing that the stronger and more resilient our society, environment and economy become, the better it is for us too.
I’m optimistic that the entrepreneurs building the next generation of great British companies understand this, and have full confidence that they will continue to do good by going well, no matter what the economy throws at them.
Orlando Martins is a board advisor, organisational strategist and headhunter. He founded ORESA Executive Search (B-corp) in 2008 and GrowthIndex.com, which ranks and celebrates the fastest-growing UK companies