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Corporations Are Beginning to Serve All Stakeholders Instead of Just Shareholders

Over the last couple of years, many things have changed in the business world. Companies are changing how they think about their constituents (i.e., customers, employees, the greater community, society and investors).
Jun 2, 2021Updated 1 day ago
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Affirming this sense of change, in 2019, the Business Roundtable released a statement officially redefining the purpose of corporations to serve not only investors but also their workers and community. In other words, instead of just creating profit for shareholders, the statement added four additional purposes: delivering value to customers, investing in employees, dealing fairly and ethically with suppliers, and supporting local communities (including being environmentally sensitive and incorporating sustainability practices). This statement was signed by 181 CEOs and demonstrates the internal shift among the world’s leading corporations. Sustainability and corporate social responsibility are no longer trends in business, but are now viewed as legitimate strategies that all businesses can use to address risk and create opportunities. As they strive for positive impacts on all stakeholders rather than simply fulfilling financial responsibilities, some businesses are truly becoming a force for good. "Major employers are investing in their workers and communities because they know it is the only way to be successful over the long term," said Jamie Dimon, Chairman and CEO of JPMorgan Chase & Co. and Chairman of Business Roundtable. "These modernized principles reflect the business community’s unwavering commitment to continue to push for an economy that serves all Americans.” This structural change can also be brought about through stakeholder capitalism, or the idea that a company's everyday practices could affect stakeholders, not just the typical understanding of the bottom line.
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Corporate Governance Business Roundtable Redefines the Purpose of a Corporation to Promote ‘An Economy That Serves All Americans’
A Growing, Resilient Alternative in a Global Crisis: Stakeholder Capitalism Benefit Corporation IPO and Approvals Signal a Renewed Focus on Stakeholder Capitalism

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