Purposeful Business

A growing number of leaders recognize the importance of defining purpose and role in society.
MORE GLOBAL COMPANIES ARE transforming themselves into purpose-driven organizations geared toward achieving innovation and growth, according to research conducted by EY and the Saïd Business School at the University of Oxford in the U.K. The research findings were discussed at the World Economic Forum in Davos Switzerland earlier this year by a group of distinguished panelists: Richard Branson of the Virgin Group; Arianna Huffington of Huffington Post Media; Antony Jenkins of Barclays; Paul Polman of Unilever; Irene Rosenfeld of Mondelez International; and Mark Weinberger of EY.

The report includes a review of relevant literature and case studies from global firms, as well as interviews with senior executives across industries worldwide. These findings show that more corporate leaders think it’s important to define the purpose of their companies—engaging a wider set of stakeholders as they do so—and to understand the company’s role within the community. While leaders recognize the importance of building strategy and business models around their core purpose, they realize there is a gap between recognition and implementation.

Andrew White, associate dean of executive education at Saïd Business School, says, “As companies acknowledge a broader set of stakeholders, ignoring this will be not just an ethical issue, but one that has a deep impact on innovation.”

The Davos event also featured the official launch of the EY Beacon Institute, which will be dedicated to transforming business through the science of purpose, and the unveiling of EY global research conducted with Harvard Business Review (HBR) Analytic Services. The survey was conducted among 474 business executives who are clients of EY or readers of HBR.

The EY/HBR survey shows that 87 percent of respondents believe companies perform best if their purpose goes beyond profit; 84 percent believe their transformation efforts will be more successful if they’re integrated with purpose; but only 37 percent believe their business models are well-aligned with their purpose.

For more information, visit www.ey.com/purposeinstitute.