"Stakeholder Value" is an idea being given a good deal of positive support by the who's who of business. Following their meeting in August 2019, the Business Roundtable released a new statement on "the purpose of a corporation". Signed by 181 top CEOs, they committed to lead their companies for the benefit of all stakeholders – customers, employees, suppliers, communities and shareholders. That society is demanding a voice in the way businesses are run and is further endorsed by a change in corporate law in the UK in 2019. Companies on the London Stock Exchange must now report on both the "Employee's Voice" and "Corporate Culture."
Expect Boards to be far more involved in organisation culture in the future. Having run sessions on culture for Board members it's interesting to note that they quickly move from interest to enthusiasm once they realise that culture can and should be measured. Meanwhile, businesses that are truly stakeholder-driven have no problem attracting and retaining top talent. Patagonia, for example, receives 9,000 applicants for every internship.
Stakeholder value is also changing how intelligent organisations think about branding. Brand is more than a symbolic representation of the product or service being offered – it's the organisation's story simply told through compelling imagery and rich language. If, in the future, that story doesn't endorse the organisation's social and environmental contribution know that consumers will look to a brand that does.
George Wallace, Chief Executive, MHE Retail, put it this way:
"Brands that can show they are putting people or the environment ahead of sheer profit will be rewarded by consumers and employees and enhance the way they consider the brand."
Expect COVID-19 to transform a soft want into a hard need.
Insights from "Leadership: Moving Beyond The Crisis".