The End of Purpose and The Too Hard Box
A couple of years ago you couldn’t move for Chief Executive’s queuing up to tell the world and their investors how their corporate strategy was grounded in purpose. Be that the need to connect their business models to a societal benefit, espousing their support for societal movements such as Black Lives Matter or Me Too, or championing the centrality of ESG to all that they did. Then, purpose felt like it was going to be more than a fashion statement.
Move forward to today and those voices have quieted and the corporate world feels a bit bereft, left with a tinnitus of purpose reminding us that they once wanted to be more. Commitments that felt easy to say have been harder to deliver as economic circumstance, inflation, geopolitics and societal divides have revealed an increasing cost of doing business.
The answer for some has been to retreat. To attempt to walk back to simpler times, when Friedman ruled and they could state that the business of business was business. That world may never have existed, but that is for another time. Having polished the lamp of purpose to release the genie of values, leadership is finding there is no putting it back in the bottle. Their desire for neutrality in the sea of issues doesn’t exist.
The irony is that this is where the world has been time and again. Debates about right and wrong have always intersected with business, just consider that we are currently dealing with legacy consequences from the slave trade long, long after it was outlawed. We should certainly not kid ourselves that this is a new phenomenon.
What is new is the power and polarisation of voices and expectation. Social media has provided everyone with a megaphone and we are all algorithmically listening. Algorithmic listening means that we hear voices who agree with us and see those that disagree condemned. Angry minorities sound like a dominant majority and it is hard to distinguish between them. It is a public good that freedom of expression has been truly democratised, so that people feel able to speak out and speak up. Yet, amplified extremes make for a scary place for CEOs - arenas where the audience is demanding your full support, and will damn you if not.
This brings us back to our more barren landscape of purposeful business. The executive remains keen to stand by its values, but the consequence of standing up is that one audience or another is going to be seriously disappointed. Those grand statements look vulnerable and leaders wonder whether they can quietly place them into the ‘too hard box’ for their successors to deal with. Consequence – financial and reputational - has become difficult to contemplate and they dream of a time before.
The challenge here is that expectation will not go away. Society isn’t going to stop changing, polarisation is with us and no comment is a no man’s land for everyone to attack. What is needed is not retreat - but deeper consideration, understanding and clarity on the consequences of taking a particular position. It requires a fuller risk assessment, of the type dispensed by operations or legal for risk, but this time for societal and reputational risk. Then good decisions can follow.
The mirage was that business sat outside of society, yet once the illusion disappears, the better answer is to be confident in your convictions and to stand behind your values and in front of your purpose.