Giving Compass’ Take:
• David K. Gibson covers the Aspen Institute’s recent success with the Business and Society Program working to shift business focus to include all stakeholders.
• How can philanthropies participate in, and give insight to, the business-purpose conversation?
• Read about the next phase of business sustainability.
On August 19, Business Roundtable, a group of CEOs whose voices echo through Wall Street and K Street, released a “Statement on the Purpose of a Corporation.” The statement reads, in part, “While each of our individual companies serves its own corporate purpose, we share a fundamental commitment to all of our stakeholders.”
The statement — widely reported as a rejection of the idea of shareholder primacy — felt like a satisfying result of years of hard work by the Aspen Institute’s Business and Society Program, which has focused on corporate purpose and addressing short-termism, and developed frameworks for long-term value creation.
It must seem especially sweet, then, to have an organization like Business Roundtable — which, in a 1997 policy statement declared “maximizing value for shareholders as the sole purpose of a corporation” — do an about-face. The one-page statement talked of corporations’ responsibilities to employees, suppliers, and communities, with shareholders bringing up the rear.
“Once we opened up the question, it built momentum in a concrete way,” Padró says, “But it was a dinner conversation for most people; you’d park that when you got to the office.” To change that, the Business and Society Program went to work behind the scenes. “This was not producing reports. It was just good old convening and digging into the issues. This was about building new ideas, collective intelligence, and collective courage.”
However, a CEO statement doesn’t make it so, he notes. If there’s not buy-in from middle and upper-middle management, then these sorts of initiatives fail, no matter how much vision and commitment comes from the top. To that end, the program created Purpose College, in which small teams of managers workshopped a live business project using a purpose lens. They worked on mapping the organization, strategies for change management, and narrative development.
Read the full article about shifting the business purpose conversation by David K. Gibson at The Aspen Institute.
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