At a moment of unprecedented attention, investment and opportunity for the emerging field of ESG, leaders are asking: Who is best preparing their organization for the society of the future? Who is innovating today to meet decades-long environmental and social goals? Who is setting standards that catalyze their industry’s change for the better? Who is defining what bold and aspirational look like — and how best to advance that work in practice?

Enter NationSwell’s ESG Next, an exemplary group of investors, executives, authors, philanthropists, social sector leaders, academics, and field builders who are helping to shape business as a force for social and environmental progress, advancing — and even pioneering — the most forward-thinking and effective programs, initiatives, technologies, methodologies, practices and approaches.

For this installment, NationSwell interviewed Kate Behncken, Corporate Vice President of Microsoft Philanthropies, about the importance of tying together purpose and profit, the power of capacity-building leadership, and this moment of tremendous opportunity for social impact and sustainability leaders.

Greg Behrman, NationSwell CEO + Founder: Tell us about how your personal and professional journey led you to ESG work.

Kate Behncken, Microsoft Philanthropies Corporate Vice President: While I was a lawyer for many years working in Australia and Europe, I was presented with the opportunity to come on board as Chief of Staff for Brad Smith, Microsoft President, Vice Chairman, and General Counsel. That post gave me an opportunity to be exposed to the broader work of the company, and it was in that role that I learned about all of Microsoft’s social impact work. 

I had the opportunity to work on a number of initiatives like Kids in Need of Defense, and I think that exposure is what really lit the fire for me to get passionate about the work we were leading, the opportunity to make a difference, and most importantly, about the responsibility the private sector has to all communities.

Behrman, NationSwell: How do you think about what defines this moment in ESG?

Behncken, Microsoft: As a tech company, we see the tremendous opportunity that technology brings — the huge benefits and great potential for technology to address some of society’s biggest challenges — but we also see the pace of change, the rapid transformation that was only accelerated in the Covid era, and how this pace raises new challenges and also intensifies existing inequities in our communities.

Because of that, at this moment, there’s greater expectation on private sector leaders from everybody — employees, stakeholders, and ourselves. I would say from what I’ve seen at Microsoft, the level of energy across the company for the work we do is at an all-time high. That’s a fantastic opportunity for someone like me in my role, so the question is, how do you tap into it in the best possible way?

We view our goals through four key lenses: supporting economic growth, sustainability, trust and protecting fundamental rights, but ESG is also so broad. I think a lot of us are thinking about what this framework means, and what it’s going to do. There’s going to be more that companies will have to report on in more ways; and there are going to be more things that we want to continue to report on.

Behrman, NationSwell: What is it about your approach to ESG, social impact, and sustainability work that yields the most success?

Behncken, Microsoft: In the private sector, there’s been a historical sense that profit happens at the core of an organization, but the purpose-driven functions take place in this small department that’s separate from it. But I don’t think that’s the case. The more that companies can bring together profit and purpose, the more they’re going to be successful.  

That’s certainly not the case at Microsoft. From a people perspective, we have a multidisciplinary team thinking about how we bring together our purpose and our profit. That’s no easy task. To do that, you really need a diverse skill set. We have people from so many different backgrounds, and as with any team, that diversity makes you stronger, and makes the work better.  

One of the really unique things about Microsoft Philanthropies is a group called Tech for Social Impact, where we focus on how we help nonprofits get access to affordable technology to be able to leverage that tech to grow, scale, and reach more of the beneficiaries that they’re trying to reach. But it’s not just the affordable technology we provide — it’s often that we’re working really closely with them to help them drive their own digital transformation. We’re meeting them where they are. Some nonprofits have great mastery of their technology tools, others not as much. So we, and our partners, listen to the organizations’ specific needs, that’s what makes our model so different from a one-size-fits-all approach to helping nonprofits.

In this arrangement, we reinvest incremental profits generated from the TSI model into philanthropy, into innovation for the nonprofit sector, and into a wide range of social good initiatives. That gives us a tremendous opportunity to do more; the better TSI does, the more that we can reinvest back into the sector.

A lot of people originally thought that a non-profit sales channel in philanthropies is oil and water; they thought, “How can that possibly work?” Well, I see it work. And it’s fantastic. Last year alone, we provided $3.2 billion in donated and discounted technology – up 29% from the previous year – to 302,000 nonprofits that deliver critical services to over 1.2 billion people around the world. Over the next five years, we will double the number of nonprofits we reach with technology discounts and grants to help amplify their impact.

We’re also focused heavily on multi-sector partnerships, like our partnership with U.S. Vice President Kamala Harris’s office to deepen investments in local economies in Central America, bolstering quality of life, increasing access to work, and helping to stem the tide of migration to the United States. For this initiative, the partners worked together to map out the different “swim lanes,” and then we each focused on the one where we could have the most unique impact. 

We lead the swim lane around digital inclusion: Microsoft is focused on expanding Broadband internet access to 3 million Central American  people and providing access to digital skills learning paths to upskill workers and make them more competitive in the job market. We’re training over 100,000 Central American workers in the next three years, helping them to learn the soft, technical, and digital skills that will enable them to gain access to  higher-paying local jobs.

The partners were very thoughtful, not only about which of us could lean in to each of the swim lanes, but about how each lane supported all the others,  and then how all involved collaborated more closely with government. I think it’s a model that we might start seeing in other countries around the world. You can learn more about our work, and the other partners involved on the White House website.

Behrman, NationSwell To which of your leadership practices or approaches do you attribute your success leading the sustainability function of an organization like Microsoft?

Behncken, Microsoft: One of my core beliefs about being a leader is that leadership is about building capacity and not dependency. Of course, I’m very focused on making sure Microsoft Philanthropies is a great place to work, but I’m also really invested in how we’re helping to grow people’s careers in the space. 

I’m also a firm believer in the power of partnerships. We partner a lot with governments around the world. It’s the only way to really achieve scale with some of the work we do, like our global initiative to upskill workers in an effort to support local economies and talent pipelines around the world.

Lastly, I am a firm believer in focus, and I steer my team towards only being at the tables where we can add really unique value. If you do less, you’ll drive greater impact. That’s a journey we’re all still on.

Behrman, NationSwell: Who are some leaders in this space whose leadership inspires your own?

Behncken, Microsoft: I’m inspired by Wendy Young of Kids in Need of Defense, a great organization working to help unaccompanied minors migrating to the US. Wendy is an amazingly generous leader, and Microsoft has worked closely with KIND over many years. I’ve had the opportunity to see how she thinks about addressing systemic issues, and she’s just very on top of it. An absolutely wonderful person.

My team and I look at the work that Shamina Singh is leading at Mastercard, not just on inclusive growth but also more broadly across the whole organization, thinking about how they bring together their purpose and their profit. (Editor’s Note: Shamina Singh is a future ESG Next honoree, and will be profiled in this series at a later date.)

Behrman, NationSwell: What are some resources you recommend that have helped to fuel your leadership, professionally and personally?

Behncken, Microsoft: Caste, an exploration of how America has been — and still is — shaped by a not-so-hidden caste system, is essential reading. The author, Isabel Wilkerson, links our social system to India’s and Nazi Germany’s, and her analysis has shaped my view of the world today.

Brad Smith, who’s the president of Microsoft, recently wrote a book called Tools and Weapons, and also recently released a podcast where he speaks to leaders in business and government to look at the world’s most critical challenges, the intersection of technology and society, rural broadband, and digital inclusion. I think they’re both essential.

To learn more about how our ESG Next honorees are shaping business as a force for social and environmental good, visit the series hub. Microsoft Philanthropies is a NationSwell Institutional Member. To learn more about membership in NationSwell’s community of leading social impact and sustainability practitioners, visit our site.