The not-for-profit sector is sometimes called the ‘for purpose’ sector, as this reflects the way organisations in the sector generally share common goals ‘for society‘.
Many companies in the ‘for profit’ sector have engaged social license, corporate social responsibility, and sustainability issues over recent years, and met with a mixed reaction. Sometimes they were accused of ‘green-washing’, or using spin, to conceal or downplay the negative impact of their activities on society or the environment.
It seems like a landmark event then, for a major US business group to affirm that they no longer see shareholder profit as their sole focus.
On 19 August the US Business Roundtable announced the release of a new Statement on the Purpose of a Corporation. This statement was signed by 181 CEOs, who have committed “to lead their companies for the benefit of all stakeholders – customers, employees, suppliers, communities and shareholders“.
Among the undertakings listed in the statement is the following notable commitment:
“Supporting the communities in which we work. We respect the people in our communities and protect the environment by embracing sustainable practices across our businesses.“
My March 25 post noted that in Australia, the Reserve Bank and the Australian Prudential Regulation Authority (APRA) had both recognised sustainability issues, and climate change in particular, as mainstream concerns. APRA’s information paper on Climate Change stated:
“A critical paradigm shift has occurred due to the work of industry, domestic and international supervisors and regulators, as well as other key stakeholders. Climate change is increasingly seen as a material prudential risk. A shift from awareness towards action in response to these risks is underway.” (p.4)
It now appears that US industry is also leading the way for US State and Federal Governments to address sustainability concerns as they too mainstream the balancing of ‘planet, people and profits’. They should be applauded for this shift to becoming ‘for purpose’ as well as ‘for profit’, and invited to share with us how they intend achieving such balance.
Hopefully they will look more closely at the Sustainable Development Goals, and commit to these too – as should we all.