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A new initiative designed to evaluate how well companies are living up to their statements of corporate purpose in a time of global crises seeks expert input from stakeholder communities.
Last year, CEOs from 181 publicly traded companies signed on to the Business Roundtable’s (BRT) updated Principles of Corporate Governance to redefine “the purpose of a corporation to promote an economy that serves all Americans.”
Today, the planet is under siege from a pandemic that has resulted in the most profound economic calamity since the Great Depression. This crisis has exposed and amplified multiple systemic fault lines, including wealth disparities and inadequate healthcare access and employment safety nets.
At the same time, and for related reasons, racial inequality is driving massive social unrest in the United States and around the world. Media reports are rife with anecdotes of companies that have failed to respond to the moment, appearing to put profits ahead of people and shareholder expectations ahead of stakeholders’ interests.
In the midst of the COVID-19 pandemic and with a spotlight on inequality, expectations of companies are shifting and expanding. Today’s state of the world poses a test of both the breadth and durability of corporate purpose commitments, shifting the dynamics for thousands of companies as they confront new challenges and demands. The current circumstances make for an important test of corporate purpose.
In response to this unprecedented moment, a new initiative called a Test of Corporate Purpose (TCP) will assess how hundreds of publicly traded companies – including those that have signed the BRT’s updated Principles – respond in a time of severe global crises and test if they truly “walk the talk” in delivering value for all stakeholders. It also seeks to analyse the impact of corporate action on systemic issues such as inequality.
TCP is currently conducting a survey among a broad range of stakeholders, including businesses, NGOs, investors, academics, regulators, and policymakers, to compare and contrast their perceptions and to inform the empirical research. We are asking Business Fights Poverty community members for your contributions to this short, expert consultation about corporate performance and accountability through the turbulent times we have been experiencing. Click here to participate in this 10-minute online consultation. (You can do this on your computer or phone.)
As a contributor, you will be sent the published research and invited to a webinar where we will share results and their implications. We greatly appreciate your participation and support in addressing these pivotal questions and paving the way toward a broad-based transformation of corporate purpose.