Corporate purpose has never been more important. Purpose can unify organizations, especially during a crisis, and gives employees a reason to come to work beyond earning a paycheck. Purpose-driven companies tend to significantly outperform their competition on all key financial metrics.
Harvard Business Review Analytic Services surveyed executives at 168 companies that place a high priority on corporate purpose and have integrated that purpose into their strategy. The survey results show how corporate purpose has helped companies steer through the Covid-19 pandemic.
Key take outs:
1) Senior executives universally agree on the importance of corporate purpose.
2) The top drivers of corporate purpose are making positive contributions to society, improved employee engagement, positive impact on brand, increased revenue/profit and strengthened ties to communities.
3) Purpose is embedded primarily in employee performance goals and reviews, business models, branding, operating processes, community services, board level review and executive compensation.
4) The top benefits of corporate purpose are improved employee engagement, employee retention and community engagement, more favourable customer reviews and increased revenue and profits.
5) Corporate purpose is best demonstrated in both recruiting and hiring and operations, as well as supporting employee causes, social media and creative opportunities to donate and volunteer.
Insight:
Investors are defining the leading indicators of integrity, purpose, and a commitment to addressing matters of concern to voluntary and involuntary participants in the enterprise.
Two of the many leading indicators of corporate purpose are “unequivocal board statement” of the company’s commitment to address the interests of all stakeholders, not just shareholders, and concrete evidence that the board selects and rewards senior leaders whose words and actions reflect a strong commitment to a purpose beyond maximizing shareholder value
