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93% of CEOs now believe
purpose of business goes beyond wealth creation
January 31, 2019
The recent YPO 2019 Global Leadership Survey points to a significant cultural shift underway. Business leaders are increasingly moving away from Milton Friedman’s strict view of the role of business to a belief that business plays an important role in positively impacting society. The survey engaged 4,154 respondents including 2,283 CEOs across 110 countries.
A massive cultural shift about the role of business leadership is in progress
93 percent of CEOs in the YPO survey agree that the “purpose of business is to have an impact on society, beyond pursuing profits and wealth.” This remarkably high percentage results from changing perspectives among business leaders in recent years. Among these same CEOs, 74 percent report having changed their perspective on the role of business in the past five years. Executives report employees, colleagues and their own children as significant influencers in their changing perspectives.
Shift mirrors societal changes
The changing attitudes of leaders reflected in this survey are mirrored by a shift that is evident in society overall. Employees and customers now increasingly expect business to play a positive role in society beyond wealth generation. According to research from the Shelton Group, 64 percent of consumers argue companies should provide ongoing support for issues that aligned with their business. These expectations on businesses have increased overtime.
To address these concerns, chief executives are working to ensure their business makes a positive impact, creating jobs and prosperity for people, teaching and mentoring, supporting nonprofits that serve their community, and other activities that contribute to societal good. These business leaders are taking on these issues with a focus on business and the greater good, not politics. Political action ranked tenth on the list of efforts.
No generational gap
While popular writings on Corporate Social Responsibility often highlight significant generational gaps in perspectives, this survey shows that leading CEOs and the younger generation of surveyed participants are aligned. Among both groups, more than 92 percent believe that business should have a positive impact on society beyond pursuing profits and wealth. The generations did demonstrate differences in the specific issues that concern them most.
Perceptions are still catching up
With a huge majority of business leaders expressing that business should have a positive impact on society and reporting that they are taking specific actions through their business, public perceptions are still catching up. The YPO study demonstrates that only one percent of chief executives say they are not interested in seeking greater impact through business and only three percent express not taking specific actions through their business to address societal concerns. As public awareness of CSR efforts increase, we can expect public perceptions of the positive role of business in society to improve.
Opportunity exists for greater partnerships
The YPO 2019 Global Leadership Report points to an opportunity for collaboration – a hallmark of the Satell Institute’s work. The survey points to an alignment between public and private interests – governments’ desire for economic prosperity and the focus of business leaders to pursue positive impact through their businesses. Certainly, that opportunity exists and is important, but the real opportunity is wider. Across the country and across the world, businesses are increasingly and effectively partnering with nonprofits and other organizations who are essential problem-solvers for society’s many challenges. When businesses and nonprofits partner to share expertise and resources communities benefit and society is positively impacted.
SI Reaches 50 Members!
The Institute’s membership continues to expand with great companies and private foundations choosing to support Corporate Social Responsibility (CSR). Our members recognize a collective force can do more for communities than any organization can do on its own.
We welcome the following new members among the several dozen who have recently joined.
KeyBank demonstrates a deep commitment to the communities across the country where their employees work and live. With a focus on creating safe, affordable, inclusive communities, high-quality education, and a strong workforce, Key supports organizations and programs that prepare individuals for thriving futures.
Founded in 1980, MCS Industries is the U.S. market leader in wall and poster frames. The company, headquartered in Easton, Pa, emphasizes superior product design, product integrity, customer service and manufacturing expertise, global expansion and robotics. MCS is committed to be a good global citizen with a focus on ethical labor standards, safety, sustainability and community support.
Richard & Susan Master Family Foundation
The Richard & Susan Master Family Foundation is dedicated to supporting worthy causes in the Lehigh Valley and across the country. The foundation joined SI with a four-year commitment to both CB Community School and the Jewish Federation of the Lehigh Valley.
How Organizations Gain the Benefits of Membership
SI’s members are dedicated to building strong communities and contributing to the greater good through CSR. To receive the benefits of membership, organizations agree it’s of business value to support CSR by contributing a minimum of $25,000 a year for four years (minimum of $100,000 total) to a nonprofit of their choice. Some members proudly choose to contribute to multiple nonprofits. The unique four-year commitment requirement allows nonprofits the stable funding needed to support multi-year programs vital to their mission.
The Satell Institute is supported by its own endowment and charges no fees or dues to members or the nonprofits supported.
For more information, www.satellinstitute.org.