Show Me (All) The Money

Where and how did you make those billions?

Most companies don’t state plainly and completely how they generate all revenue.

They say if you want to know what’s going on, follow the money. But what if you can’t follow most of the money that affects your life? That’s the current reality when it comes to corporate disclosures.

If you communicate about a business, please answer:

How do you make money? in honest, cohesive, plain language. Do not cherry pick highlights with insider-speak and euphemisms. Do not leave out vast swaths of your revenue story. Show us the whole financial pie and what it’s made of in a way the people you impact understand.

Most companies don’t show us the money well. This undermines our collective wellness as we continue to incentivize harmful practices fueled by ill-informed decisions.

I will use a particularly terrible example—JBS, a large Brazilian meat company—to make the point. Lest I appear to be picking on them, I also randomly searched “award-winning ESG report” and took the first one that came up—Swiss “industrial corporation” (their words, not mine) Georg Fischer. It’s not much better so I’ll break that down, too.

Matereality asks: How does the company make its money?

I recently conducted a Matereality assessment on JBS. To apply a Matereality lens, we need information. The first question—What does the company say it does?—is about purpose. I journeyed into that dark cave of Matereality in last week’s post, Purpose Is As Purpose Does.

Purpose Is As Purpose Does

Today I’ll delve into the second question: How does the company make money? This should be a simple question—there are rules and standards (like GAAP and IFRS) that shape financial disclosures. I don’t have the expertise to identify accounting irregularities, so I am going to assume companies have undergone the necessary review, that technically speaking, their disclosures are compliant.

I do, however, have the common sense required to notice when things lack sense. With distorted, nonsensical information, we’ll keep rallying behind an economy that is served by life—human and otherwise—even as it causes us collective harm.