This year marks the 20th anniversary of the founding of CECP – now, Chief Executives for Corporate Purpose. Corporate Purpose became part of our name over the past year, marking how more than ever CECP believes companies can create a better world through business. In a year when 181 CEOs signed the Business Roundtable’s Statement on the Purpose of a Corporation, which emphasizes the importance of all stakeholders in society, the time could not be riper to assess the state of Corporate Purpose. In December, CECP will launch the third annual Investing in Society report.
Developed from CECP’s premier research on, thought leadership for, and strategic engagements with more than 200 of the world’s largest companies, this digital release brings to light the state of corporate purpose in an evidence-based way and assesses corporate purpose-driven actions under the five categories of Priorities, Performance, People, Planet, and Policies.
Our method to assess the state of Corporate Purpose included analysis of publicly reported ESG data, secondary research through papers and releases from highly-regarded organizations that also assess trends corporate purpose and the issues that affect corporate purpose, as well as the questions and interactions with leaders of social impact and ESG programs at CECP companies. Investing in Society is the must-read source for trends on the corporate sector’s shift to be increasingly purpose-driven.
You may wonder, why is Investing in Society organized into five sections? When companies report on the “state of” their company (or we could say, achievement of their corporate purpose), CECP found that at the executive level, these five areas best represented the evolution currently underway. Performance still leads what a CEO expects to have on their scorecard, but it is increasingly managed in context of other ESG metrics. If you’ve seen CECP’s Strategic Scorecard guidance, you read more about what we mean by that. As such, it made sense to address the state of corporate purpose across the sector using familiar categories. Each of these categories is made up of multiple drivers and opportunities to show progress on how companies act on purpose, embed purpose, and ultimately have purpose drive long-term sustainable performance.
Without further ado, here are the five main trends on the state of Corporate Purpose! Read the full story in Investing in Society: 2019 Edition:
- PRIORITIES: Companies are creating and committing to statements of purpose that address more stakeholders – investors are still important but are making room for employees, communities, and more. Part of these priorities include better measurement of Corporate Purpose and of the comprehensive benefits it provides.
- PERFORMANCE: Although large companies have performed financially well in recent years and although they realize the importance of creating Long-Term Plans in addition to disclosing short-term milestones, there is room for growth in terms of consensus of measurable metrics. CECP’s Strategic Investor Initiative released in 2019 a new framework for companies seeking to develop long-term plans and research pieces that can help the reader navigate in the challenges of short-term prioritization
- PEOPLE: Companies have taken big steps to do more social investing, engage their employees, and improve equitable and inclusive practices, simultaneously creating stronger connections with their customers. Read more on how the corporate sector continues expanding its social investments and engaging its employees to be a force for good in society in our latest publication of Giving in Numbers.
- PLANET: Environmental performance has been mixed. Some metrics show big gains whereas others demonstrate significant setbacks. Check CECP’s Strategic Scorecard on how metrics like recycled waste or water use had setbacks; but others like reduction in greenhouse gas emissions or creation of water policies of companies in the Fortune 500 ranking actually improved.
- POLICIES: Although corporate governance traditions have experienced significant upheaval, resulting in slower progress towards change, there have been some improvements in representation of historically underserved communities in leadership positions in the last couple of years.
Join a webinar for our companies learn more and share your point of view on the evolution of corporate purpose. Do you have anecdotes to share with CECP about why you think your company’s purpose statement takes into account stakeholders other than investors? Send us an email!