Posted by Shivali Anand
September 24, 2021 | 3-minute read (565 words)
Operating a purpose-driven firm has several advantages, ranging from increased sales to happier workers. Read what some of today’s most recognized CEOs have said about the importance of leading their companies with purpose.
Corey Barry, CEO of Best Buy
Best Buy’s commitment to diversity and inclusion has helped guide the company on the right path, Barry says. By 2025, she said the company intends to fill 1 in every 3 new corporate salaried positions with racially diverse hires, and another 1 in 3 new salaried field roles will be filled by a woman.
“It is an imperative that we reflect our communities. It’s been proven time and again that diverse teams produce better outcomes,“ she said in her keynote CES 2021 speech.
Marc Benioff, CEO of Salesforce
Benioff emphasizes the importance of CEOs in using their companies to accomplish greater good in the world. "I try to model for other CEOs how to actually use their business as a platform for change, how to improve the state of the world with their companies,” Benioff told Yahoo Finance.
Benioff urges leaders to keep evaluating questions like “What's the most important thing to you, do you know as a CEO? Is it trust? Is it equality? Is it sustainability?"
Lynn Good, CEO of Duke Energy
Good says that leaders need to go beyond simply stating a purpose. They need to routinely demonstrate that purpose in their actions or they will lose credibility.
“When I say employee safety is important, I need to demonstrate it with unequivocal safety protocols. When I say climate is important, I back up my climate plan with investments to show we are making progress,” Good told Fortune and McKinsey.
Kenneth Frazier, former CEO of Merck
Frazier points out that the pharmaceutical company is dedicated to improving society. He said to the Harvard Business Review: "While a fundamental responsibility of business leaders is to create value for shareholders, I think businesses also exist to deliver value to society."
Frazier, who stepped down as CEO in July 2021 and is now executive chairman of Merck's board of directors, elaborated that the company has been around for over 125 years and its purpose throughout “has been to deliver medically important vaccines and medicines that make a huge difference for humanity. The revenue and shareholder value we create are an imperfect proxy for the value we create for patients and society."
Alan Jope, CEO of Unilever
Jope observes that 28 of Unilever's brands have adopted a purpose-led mission, and now those brands were expanding more rapidly than the rest of its portfolio, implying that they are beneficial for the company and the world.
"Business can be a force for good in the world,” Jope told Bloomberg, adding that Unilever may eventually sell companies it deems to have a negative social impact.
Larry Fink, CEO of BlackRock
Fink once wrote a letter to fellow CEOs highlighting the necessity of setting community-oriented goals as leaders. "A company cannot achieve long-term profits without embracing purpose and considering the needs of a broad range of stakeholders,” the letter stated.
Fink also cautioned other company executives that neglecting purpose will cost them money in the long run. "Over time, companies and countries that do not respond to stakeholders and address sustainability risks will encounter growing skepticism from the markets, and in turn, a higher cost of capital," Fink said.