The Death of Loyalty and the Performance of Purpose

Adam Smith is often remembered as the father of capitalism, though I suspect he’d barely recognise his creation. Long before The Wealth of Nations became shorthand for free markets, he wrote The Theory of Moral Sentiments (1759), a far gentler book, full of human observation. In it, he described the strange alchemy that makes societies work: our ability to imagine what others feel, and to behave well not simply for gain but because we wish to be thought decent.

He called that inner sense the impartial spectator, a sort of moral referee living quietly in our heads. When it functions properly, it reminds us that self-interest and sympathy aren’t opposites but partners. We succeed by serving others. For Smith, commerce was not a race to the bottom; it was the everyday choreography of mutual benefit.

But he also issued a warning: people have a dangerous habit of admiring wealth and power more than virtue. Once admiration is misplaced, morality follows it downhill. The impartial spectator, dazzled by success, stops asking whether something is right and starts asking whether it looks impressive.

Two and a half centuries on, that’s more prophecy than philosophy.

“Purpose” has become the business world’s favourite moral makeover. According to Benevity’s State of Corporate Purpose 2025 report, 88 per cent of leaders now say purpose is key to “future-proofing” their organisations. McKinsey found that 82 per cent of employees believe their company should have a purpose, and nearly three-quarters think it should take precedence over profit.

On paper, that sounds like Smith’s ideal society finally taking shape. One where enterprise serves the many, not the few.

But the same reports also hint at unease. Benevity notes that two-thirds of companies have recently redefined their purpose, suggesting instability rather than conviction. McKinsey describes “a yawning gap between articulation and execution”. Everyone has a statement; far fewer have a strategy.

Robert Kaplan’s 2023 paper The Promises and Perils of Corporate Purpose is less diplomatic. He argues that many companies now “decouple purpose from performance” adopting lofty language precisely because it costs nothing. Purpose becomes “a shield against criticism and a substitute for strategy”. In short: it’s marketing with better lighting.

So we find ourselves in a strange moment. Purpose has never been more popular, or less persuasive.

The influencer is capitalism’s purest creation: a person who monetises attention itself. Platforms that once promised connection now reward curation. Every post, partnership, and pose becomes a line in a personal balance sheet.

The dynamic is identical. Both corporations and influencers chase admiration, not integrity. Both appeal to audiences rather than to Smith’s “impartial spectator”. And both operate in an economy where visibility equals virtue.

This is the moral pivot Smith warned of. When admiration is captured by those who look good rather than those who do good, societies start to hollow out from the inside.

Smith’s market depended on trust. The butcher and the baker cared about reputation because their livelihood depended on it. Trade was personal; loyalty was the default setting.

Now, loyalty has been mechanised. Algorithms remember our birthdays better than friends do. Brands talk about “communities” when they mean “databases”. Reward points have replaced relationships. We’ve gamified belonging.

It’s a clever system but a shallow one. Convenience masquerades as connection, and our sense of commitment — to products, people, even principles — thins out. We move on at the first hint of friction.

The result is a culture of perpetual trial periods. Everything is provisional. Companies chase retention metrics while customers swipe right on the next offer. The language of loyalty remains, but the sentiment is gone.

And without loyalty, there can be no real purpose. Purpose implies duration. Sticking with something, even when it’s not convenient.

If Adam Smith wandered through a shopping centre (or worse, scrolled Instagram), I imagine he’d be appalled but not surprised. The machinery of exchange has become extraordinary; the moral software running it has not been updated since 1759.

He’d recognise the symptoms: the admiration of wealth for its own sake, the elevation of spectacle over substance, the quiet erosion of trust. He’d probably ask the same question he did then: what have we chosen to admire?

Because admiration is the invisible currency that sets the price of virtue. A society that admires decency will, in time, become decent. One that admires ostentation will sell its soul for a sponsorship deal.

Smith’s insight was disarmingly simple: capitalism works when self-interest and sympathy are balanced. Remove sympathy and the market becomes a mirror reflecting only greed.

To reclaim purpose, we have to stop shouting about it. Real purpose isn’t something you broadcast; it’s something you build quietly into your behaviour. It’s visible only in retrospect. The pattern that appears when you act consistently over time.

For organisations, that means rediscovering why they exist and aligning the daily mechanics of business around that “why”. Not the glossy mission statement, but the mundane decisions: who you hire, what you make, how you treat suppliers, what you refuse to compromise on.

The irony is that true purpose tends to be boring. It looks like reliability, honesty, patience… virtues that don’t trend but do endure. It’s the long game of trust rather than the quick hit of applause.

That’s also what loyalty really is: the quiet accumulation of trust over time. You don’t earn it with a discount code; you earn it by showing up.

Our problem isn’t simply that people consume too much; it’s that consumption has become a form of moral expression. Buying the right coffee or trainers is a proxy for goodness. We outsource virtue to brands the way we once outsourced taste to critics.

The market loves this because it turns ethics into retail. Every purchase is a small act of identity management. Every brand story offers redemption through lifestyle. But moral sentiment can’t survive as a marketing category; it needs friction, humility, and the possibility of saying no.

Smith’s impartial spectator was meant to keep us honest, to remind us that doing right sometimes costs us something. Modern consumer culture removes the cost. It promises moral satisfaction with free delivery.

If capitalism is to have a moral revival, it won’t come from slogans. It will come from reconnecting self-interest with service. Businesses that solve real problems, treat people well, and price fairly will still make money, and perhaps rediscover respect in the process.

Responsible capitalism isn’t anti-profit. It’s anti-pretence. It recognises that markets thrive on trust and that trust is built on truth. It rewards craft over hype, contribution over noise, and measures success not just in growth but in goodwill.

Loyalty, in this version of capitalism, becomes a moral exchange again: you stay with a company because it deserves to be stayed with; it keeps you because it values the relationship more than the transaction.

It’s not romantic. It’s just good business with a conscience, which, incidentally, was Smith’s point all along.

I spend much of my professional life working with organisations trying to articulate purpose. Often, the most useful thing I can do is help them stop performing it. Most already have a reason to exist that’s quietly noble, they’ve just forgotten how to speak plainly about it.

Purpose becomes powerful only when it stops being performative. The moment a brand starts worrying about whether it looks purposeful, it usually isn’t. The same is true for individuals. The urge to appear admirable is precisely what corrodes admiration.

The alternative is simple, though not easy: do the work, tell the truth, and let reputation arrive late.