Governance
Impact vs. Profit
As it is often for individuals, money can be a taboo topic for impact-oriented businesses. For-profit organizations with missions that claim a social or environmental good often wear the clothes of their non-profit siblings, so that when it comes time to talk about financial realities, it can be difficult or even awkward. These types of companies tend to attract people who are more missionaries than mercenaries – individuals who take pride in careers that combine purpose with ambition. On the individual level, those priorities can exist in apparent tension – and when bubbled up to the level of the collective, the same tension can emerge at the scale of a team or organization’s culture.
Walden Mutual is not immune to those same tensions, especially as a bank – an institution located so close to the heart of our financial system...and neither is one of our most mission-aligned partner businesses, Green City Growers (GCG). Founded in 2008, GCG shares our emphasis on building bridges between participants in our local food ecosystem. Their purpose is to provide inspiring shared experiences to connect and educate people to grow food sustainably. They’re innovators in an emerging industry called “farming as a service”. They design, install and maintain raised garden beds, in-ground farms, hydroponic growing operations, and more in all sorts of settings – from schools to corporate offices…even at Fenway Park in Boston. They have over 150 active sites across Boston. Once a garden is set-up, not only do they actively maintain it to ensure it thrives, but they also use the gardens to educate people about growing food sustainably.
Since the beginning, their social and environmental ambitions have been at the center of their motivations. They even became a B Corp (like us) back in 2014. Implementing progressive programs (like providing competitive wages, employee ownership - or ESOP, and benefits for their workers) came easily for them as an extension of their mission...but financial performance and growth lagged during the early years.
In 2021, things had started to change. A new CEO had come into leadership in 2019, and a new question came into focus: What does it mean to scale a mission statement? Their answer: Combine their passion for food system change with a commitment to excellence in execution. That vision allows them to clarify the relationship between seemingly competing priorities – scale and impact.
Now, developing differentiated expertise in their domain, exceeding customer expectations, cultivating excellence down at the level of individual tasks – it's all missional. Their operation is bearing new fruit (figurative and literal); a growing team and an expanded set of organizations and communities impacted. This year alone, GCG has grown 61,000 lbs. of produce and created experiences with food for over 59,000 people. The goal is not unchecked growth, but growth that accentuates their mission.
We feel a sense of kinship with businesses like GCG, who grapple sincerely with these questions about scale and impact. As our impact philosophy has matured with time and experience, two convictions have proven useful as anchors in our internal discourse on the relationship between growth and our mission:
- Scale can drive impact.
While we’re generally weary of the hubris of "change the world” rhetoric, when orchestrated responsibly, growth enables us to push our mission further. - Profitability fuels scale, and proves viability.
We were intentionally designed as a for-profit entity, so 1) the fuel for our growth is profitability born of excellence in execution, and 2) the proof that our model works hinges (in part) on financial viability.
On both convictions, we’re excited to report our progress. On scale: Earlier this year, Walden Mutual crossed the $100M asset threshold, deploying our capital to an exciting portfolio of innovative and impactful partner businesses. On profitability: November was Walden's first profitable month, an important milestone in the journey to prove the viability of our model.
