![]() ![]() Digital platforms are powerful amplifiers. In just the past year, companies have witnessed hundreds of thousands of employees walking out over climate issues and recurrent high-profile petitions about business practices that have raised the ire of socially conscious interest groups. Organizations turning a blind eye will face inevitable blowback. And the majority of employees in the corporate world feel “disengaged” they are agitating for decisions and behaviors that they can be proud to stand behind and gravitating toward companies that have a clear, unequivocal, and positive impact on the world. Customers are boycotting the products of companies whose values they view as contrary to their own. The August 2019 Business Roundtable Statement, which elevated stakeholder interests to the same level as shareholders’ interests, represents both a reappraisal of purpose and a reflection of tensions that have been boiling over. We hope this will help you wherever you are on your journey. What we present here is some early thinking about the road ahead from our research and engagement with clients around the world. ![]() ![]() In doing so, we don’t pretend to have all the answers. In this article, we try to distill some inspiring steps taken by forward-looking companies. Business also has an opportunity, and an obligation, to engage on the urgent needs of our planet, where waiting for governments and nongovernmental organizations to act on their own through traditional means such as regulation and community engagement carries risk (for more, see “ Confronting climate risk”).įortunately, a “how to” playbook is starting to emerge as a growing number of companies lead. The power of purpose is evident as the world fights the urgent threat of the COVID-19 pandemic, with a number of companies doubling down on their purpose, at the very time stakeholders need it the most (for more, see “ Demonstrating corporate purpose in the time of coronavirus”). Yet when companies fully leverage their scale to benefit society, the impact can be extraordinary. ![]() While shareholder capitalism has catalyzed enormous progress, it also has struggled to address deeply vexing issues such as climate change and income inequality-or, looking forward, the employment implications of artificial intelligence.īut where do we go from here? How do we deliver a sense of purpose across a wide range of environmental, social, and governance (ESG) priorities? Doing so means moving from business as usual to a less traveled path that may feel like “painting outside the lines.” Are we going too far beyond our core mandate? Does it mean we’ll lose focus on bottom-line results? Will transparency expose painful tensions better left unexamined? Will our boards, management teams, employees, and stakeholders want to follow us, or will they think we have “lost the plot”? There are no easy answers to these questions corporate engagement is messy, and pitfalls, including criticism from skeptical stakeholders, abound. Only 7 percent of Fortune 500 CEOs believe their companies should “mainly focus on making profits and not be distracted by social goals.” 1 Alan Murray, “The 2019 Fortune 500 CEO survey results are in,” Fortune, May 16, 2019,. ![]()
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