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Millennials Seeing How Business Can Be More Innovative, Sparking Innovation from Within

Millennials are earning a reputation for doing things differently. They communicate intensively using social networking (Facebook, Twitter, Pinterest), are revolutionizing transportation (Uber, Lyft), and are now demanding corporate sustainability and accountability. Currently the largest living generation in the United States, Millennials have enough ‘buying power’ to throw their weight around.But this innovation doesn’t happen by chance or because Millennials passively expected it — they create it by advocating for themselves.

By R. Paul | Published 8 years ago | About a 6 minute read

But this innovation doesn’t happen by chance or because Millennials passively expected it — they create it by advocating for themselves.

How are Millennials sparking innovation? The old-fashioned way, by speaking up and leading the way. At Sustainable Brands, for example, Tamay Kiper is a content manager and trained engineer. Kiper chose to take her talents to Sustainable Brands because she believed in its mission to help brands accelerate the shift to a flourishing future. When Kiper began investing in her 401(k), she realized her investments were not necessarily in line with her values, so she spoke up.

Kiper’s investment plan administrator explained that although he had focused on providing fiduciary responsible investment options, he did not know the social or environmental impact of those funds. So Kiper recommended that the firm work with a sustainability ratings firm to create impact scores for mutual funds and ETFs. The goal was not only to rate for financial performance, but also to identify future risks from human, social and environmental factors in a changing marketplace.

Take fossil fuel companies such as Exxon or Chevron, which are currently valued based on the oil and gas reserves. When major fossil fuel companies extract all of their reserves, the global environment will be drastically deteriorated. This scenario doesn’t seem possible, and those reserves don’t seem like assets. These firms could be overvalued and overpriced. Hence, Tamay and her peers can now allocate their 401(k) in a more sustainable manner.

In a similar fashion, Mark Bresnahan is a Product Manager at Fourstar Connections. Bresnahan is energized by sustainability and wants his employer, a design and manufacturing firm, to benefit the environment and profit at the same time. As chairperson of the Environmental Committee at Fourstar, Bresnahan’s leadership — with expertise from Joy Pettirossi-Poland, creator of the More Value and Profit (MVP) Program — is helping Fourstar gain competitive advantage and engage employees. One of those initiatives was sparked by evaluating its 401(k) on sustainability, which has helped spread the Carbon Disclosure Project (CDP) reporting, as well as expand conversations with Fourstar’s customers about environmental impacts. Bresnahan explains:

“My generation feels a responsibility to not only have a net zero impact on society, but create an environment where people and businesses are a force for positive change. Evaluating our 401ks for sustainability empowers us as individuals to put our money to work. Investing this way can benefit society, reduce our future risk, and enhance our potential for future returns."

Leadership comes at nonprofits, too. As You Sow is a shareholder advocacy organization that has made major progress campaigning for citizens and society, including fossil fuel divestment. However, As You Sow’s employees realized that their 401(k) plan options were invested in the fossil fuel companies they were campaigning against. As You Sow prototyped a tool with our firm, HIP Investor, to identify mutual funds and ETFs that do not hold fossil fuel producers. A new free, online tool — FossilFreeFunds.org — allows users to search across more than 1,500 mutual funds from their portfolio or retirement plan to see if their portfolios are fossil free.

Mission-based organizations are attracting Millennials. Environmental Building Strategies advises Fortune 500 companies and organizations of all sizes on how to improve their real estate, offices and human workspaces. Yet EBS’s 401(k) could be more sustainable. Graduates of the Presidio Graduate School’s MBA program, it was natural for business partners and Millennial entrepreneurs Burke Pemberton and Matt Macko to ensure the firm was 100 percent sustainable. Working with Communitas Financial and HIP Investor more than two years ago, EBS now shows the sustainability profiles of the mutual funds in its 401(k). Now, 100 percent of staff invests in their 401(k).

To build a better world, EBS project manager Kristen Magnuson suggested the next innovation — offering Fossil Free portfolios in the 401(k). Kristen was inspired at The Bioneers Conference where she experienced systems change this way:

"One person at a time, caring deeply about something, and taking a special interest in it, then speaks up, making sure their voice is heard. By taking action and doing something, figuring it out, leads to small victories, and possibly big ones. Then in discussing both successes and failures, trying again."

So when she returned to EBS the next week, Magnuson suggested this new innovation. “Let’s make this happen; if it's not an option, I want it to be created.”

Pemberton and Macko welcomed the innovations, as did Communitas and HIP, to push investing to the next level. "Red tape changed color and POOF! Here we are: multiple portfolio options for different risk-appetites, and all fossil free! One of the happiest days of my life.”

Top employers stay that way by listening to all employees, engaging them, and unleashing their innovations. The best and the brightest employees want to work for those firms. Now more than ever, Millennials “want more from business than might have been the case 50, 20, or even 10 years ago,” says Barry Salzberg, CEO of Deloitte Global.

And hiring the best employees to your team is only the first step. In order to be engaged and working to their potential, employees need to feel heard and acknowledged. Employee satisfaction can be highly correlated with corporate performance. See here how Fortune’s 100 Best Companies to Work For, compiled by Great Place to Work Institute, has outperformed the S&P500 and Russell1000 from 1997 to 2014.

Whether you are innovating on the front lines of your organization, engaging your workforce as a manager or HR leader, or learning about your own 401(k), you have the power to build a better world — that can seek both human, social and environmental impact as well as potential profit.

Now is your time to speak up. You have the tools and you have the power.

On Thursday January 14th, leaders from As You Sow, EBS, HIP Investor and the MVP will show how companies can engage employees, and improve their 401(k) offerings for staff: