But many executives cite barriers — such as pleasing too many stakeholders with differing views — as part of Corporate America’s challenge in making authentic progress on social issues.
Eight in-10 (83 percent) executives today feel an urgency for business to be a critical part of driving solutions to some of today's most pressing issues — including COVID-19, racial injustice and economic resurgence — according to the 2020 Porter Novelli Executive Purpose Study.
The survey of 150 C-suite executives at companies with revenues of more than $500 million examines business leaders’ opinions on Purpose-driven leadership and how business should engage on issues including social justice and diversity, equity and inclusion (DE&I) within the context of 2020’s rapidly changing environment, and beyond.
“It’s clear the events of this year have fundamentally changed the business environment — as well as the role of business in society,” says David Bentley, CEO of Porter Novelli. “There is more urgency than ever before for business to be a leading player in solving for critical global issues — and smart leaders recognize taking a stakeholder-first lens is not only good for society and communities, but also for business and bottom lines.”
The new study corroborates the results of Porter Novelli’s Purpose Tracker, released earlier this summer, which revealed a new expectation from the US public — that companies back up their words of support and solidarity on hot-button social issues with action.
The role of business in the racial justice and equity movement
Hear more from some of the organizations, large and small, that are taking authentic action and making long-term, systemic commitments to creating diverse, equitable workforces at Just Brands '21 — May 11-12.
The results of both studies seem to be a sign of the times — and Dwayna Haley, Porter Novelli’s SVP of Innovation & Impact, summed up this new business imperative nicely:
“It’s time to get uncomfortable in order to make a difference. As communicators, we have a powerful opportunity (and the accountability) to positively influence behavior change. Through messaging with strategic calls-to-action, brilliant creative and multichannel outreach, we can impact widespread sea change in any environment.”
Execs agree that leading with Purpose drives profit
Purpose-driven business has been on an upswing for the past few years — and the 2019 redefinition of the “Purpose of a Corporation” by the Business Roundtable in 2019 seemed to solidify the notion that business solely for profit was largely a thing of the past. The Executive Purpose Study supports this trend: The majority (85 percent) of business leaders surveyed agree it is no longer acceptable for companies to myopically pursue profit; they must positively impact society, as well.
We saw Business Roundtable’s notion of “an economy that serves all” in practice this year, as many companies pivoted their product and service offerings in real time to meet immediate needs as the pandemic gained momentum. And a growing number of companies have authentically shown their support for Black Lives Matter since the murder of George Floyd by Minneapolis police — going beyond “thoughts and prayers” to rethinking their product and brand strategies, communications, hiring policies and industry-wide practices.
And over nine-in-10 (91 percent) execs polled by Porter Novelli said they are eschewing an investor-only focus in favor of a business that benefits all stakeholders, but not for altruistic reasons — 89 percent believe that companies that lead with Purpose have a competitive advantage in today's marketplace; with 85 percent believing Purpose-driven strategies drive profit.
“While most executives recognize the need to engage, our benchmark research indicates average Americans are even more fervent in their belief that business should be prepared to solve for myriad social justice issues plaguing society today,” says Porter Novelli CMO Kate Cusick. “In order to drive change, Corporate America’s C-suite need to get outside their comfort zones in addressing these diverse issues that are now an expectation of consumers, employees and other stakeholders.”
But barriers remain to taking stands on social justice issues
Even as the majority of business leaders today acknowledge business’ role in addressing many social justice issues, barriers remain to further pursuing these topics — including, but not limited to:
stakeholders all wanting different things (43 percent)
lack of internal alignment/action on issues (28 percent),
fear of retaliation from different stakeholder groups (27 percent)
risk-averse boards and key decision-makers (25 percent)
not enough money or resources to make an impact on these issues (15 percent)
not knowing where to start in addressing the myriad pressing issues (14 percent)
DE&I is a moral and business imperative
Despite the overwhelm, the majority of execs today recognize the value and necessity of a diverse and vibrant workforce — nearly three-quarters (73 percent) believe DE&I is a moral and business imperative that drives profit (only a third [35 percent] said that DE&I isn’t a core business priority for their company). And executives (84 percent) are also significantly more likely than the average American (69 percent) to believe that Purpose and DE&I are inextricably linked — that a company cannot be truly Purpose-driven without having strong DE&I values.
Click here for more findings from the Porter Novelli Executive Purpose Study.