On August 19, the Business Roundtable made an announcement that the purpose of business is no longer to uphold shareholder primacy, as its mission statement has declared for decades, and is instead to prioritize and care for all stakeholders. As the co-founders of the B Corp movement wrote for Fast Company in response to the announcement, “It’s a significant sign of our shifting culture that the country’s largest corporations and the organization representing their interests are revising their definition of the purpose of the corporation from profit maximization to leading their companies ‘for the benefit of all stakeholders — customers, employees, suppliers, communities and shareholders.’” In The New York Times on August 25, 33 B Corp CEOs called for the business leaders of the Business Roundtable to put their words into action by adopting benefit corporation governance structures.
The co-founders also noted that this stakeholder focus is not a revelation to the community of Certified B Corporations. The B Corp community has led this charge for more than a decade, adopting stakeholder governance and transparently measuring impact across all stakeholders.
And B Corp leaders who are leading the charge have been supported by investors, employees and customers:
“Investors have never questioned for a moment why we’re doing what we’re doing, nor have they questioned our benefit corporation legal structure. I’m completely comfortable with the fact that we’re a public benefit corporation and a Certified B Corp, and I’m really proud of it. I think it helps our business because I believe people — particularly younger people — see business and the private sector as part of a larger ecosystem.”
—B Corp Allbirds co-founder and co-CEO Joey Zwillinger
“We’re living in a world where business is responsible for more than 60% of the pollution of our air and our water and our land, and yet businesses take very little responsibility. I think what the B Corp community does is brings together these like-minded companies to be a greater force for good in the world. … This idea that business is somehow bifurcated from the rest of life, it has no responsibility to the environment, it has no responsibility to social good is total bullshit. It’s a totally outdated way of thinking about the world. It’s one of the things that really gives me hope about this [B Corp] movement, because not only does it provide a legal structure, which didn’t exist before … but it also provides a community and a legitimate certification process.”
—B Corp Patagonia CEO Rose Marcario
“I thought people would think it was cool, but I didn’t know it would stop people in their tracks and have them immediately want to work with us. Being a benefit corp has also been amazing in our work with universities. And it hasn’t just been the mission-driven millennial generation. People from older generations have been embracing it as well and wanting to work with us. Our decision as co-founders to become a benefit corp took, without exaggerating, 10 minutes. We knew it was the right thing to do.”
—B Corp data.world co-founder Brett Hurt
In The New York Times on August 25, 33 B Corp CEOs called for the business leaders of the Business Roundtable to put their words into action by adopting benefit corporation governance structures. This is a message B the Change, B Lab, and the B Corp CEOs encourage all in the B Corp community and B Economy to share and spread as business moves into a more purpose-driven future:
We are part of a community of Certified B Corporations who are walking the walk of stakeholder capitalism.
We are successful businesses that meet the highest standards of verified positive impact for our workers, customers, suppliers, communities and the environment.
We operate with a better model of corporate governance — benefit corporation governance — which gives us, and could give you, a way to combat short-termism and the freedom to make decisions to balance profit and purpose.
As you know, with continued resistance from investors on this new definition of business, we’ve got work to do to help them see that stakeholder governance builds trust and builds value. More importantly, it also ensures that the purpose of capitalism is to work for everyone and for the long term.