Reinventing the object of the company in 2022
The corporate purpose can constitute an important competitive advantage at the end of the pandemic. According to a new study from IMSA Search Global Partners, high-goal companies show higher revenue growth, higher operating profitability and better return on capital than those that focus solely on profit maximization. Purpose also turns out to be a great hiring advantage. Let’s take a closer look.
February 25, 2022 – Now two months into 2022, many business leaders thought we were going to put the pandemic behind us and charge full steam ahead into a post-COVID world. However, with the recent rise of the Omicron variant and the number of cases continuing to rise around the world, the reality is that COVID and new forms of the virus will be with us for the foreseeable future.
The effectiveness of vaccines/boosters and new antiviral treatments are encouraging most companies to embrace some version of in-person return to work. “While COVID may seem less of a crisis and more chronic, leaders must acknowledge the upheaval of the past two years, including the impact of social movements like #MeToo, Black Lives Matter and the climate crisis,” a new report concluded. of the IMSA Executive Search Network Search for global partners. “Current reconstruction efforts are taking place at a time of significant shifts in societal norms. The company’s goal, to serve as a foundation during recovery, a beacon through change, is to keep pace,” the report notes.
The goal provides a competitive advantage
The corporate purpose is not a public relations exercise. It’s a competitive advantage, IMSA said. According to Chief Executives for Corporate Purpose (CECP), research demonstrates that companies with an established and articulated purpose – high-purpose companies – have 14% higher revenue growth, 8% higher operating profitability and improved performance. 6% higher capital compared to companies that focused solely on maximizing profits. And the gap is widening.
Purpose is a factor in purchasing decisions, according to the IMSA report. “People don’t buy WHAT you do; people buy WHY you do it,” Simon Sinek, goal expert, researcher, and best-selling author, said in a TED Talk. Purpose directs a company towards social responsibility which in turn motivates customers which in turn helps create value.
“Purpose is also an advantage in hiring, especially among younger employees who want to work for companies that share their own personal values and whose actions demonstrate concern beyond profits,” said Michael Berger, Managing Partner of IMSA Search Global Partners USA and member of the IMSA Board of Directors. “Talent asks: are there corporate social responsibility programs? Environmental, social, government (ESG) programs? Volunteer opportunities for employees? All of these are expressions of business purpose today.
Meaningful narrative and stabilizing force
The Conference Board calculates that nearly a quarter of S&P Global 1200 companies have a corporate purpose statement (PCS), defined as “a public commitment to identify and address the needs of multiple stakeholders well beyond the meeting room”. In this age of stakeholder capitalism, business leaders define their primary responsibility as creating long-term value not only for shareholders, but also for customers, suppliers, employees and the communities in which they do business. business, according to the IMSA report. “Shareholder value is based on profit. The value for these other stakeholders is based on the human need for meaning.
Goal-oriented leadership and its impact on long-term financial results
Purpose doesn’t just add to an employee’s well-being; it adds to a company’s bottom line. This is the main conclusion of a survey of senior executives which has just been carried out by Korn ferry. The vast majority of respondents (96%) said there is a long-term financial benefit to companies that make a strong commitment to goal-driven leadership, with 77% agreeing “to a large extent measure “.
One of the reasons why goal-oriented leadership can add to a company’s financial gain, according to the survey, is the impact it has on employees. Eighty-nine percent of respondents said they believe understanding and embracing their organization’s mission/purpose increases employee productivity.
In a recent article, Hubert Joly, former CEO of Best Buy and recognized by Harvard Business Review, Barron’s and Glassdoor as one of the best CEOs in the world, confirmed that more than eight in 10 executives believe that a strong sense of Common purpose drives employee satisfaction, increases customer loyalty and can play a pivotal role in business transformation. Additionally, rationale can stabilize a business through volatility, helping to deliver higher and more sustainable performance.
Developing a Powerful Purpose – The Why Beneath the What
The SCP is a key part of the corporate identity narrative. Along with vision – the overall long-term goal of a business, mission – what a business does, and values - how a business does its job, purpose asks why a business exists or why it does what it does. she does, according to the IMSA report.
Related: Five Strategies for Attracting Top Talent in Today’s Market
“Powerful purpose statements communicate a company’s commitment to making a difference in people’s lives, not to being the best, the biggest, or the fastest,” the report says. “PCSs need to be credible, align with a company’s business, connect to its industry. They must be authentic, resonating with the personal values and passions of the employees. They should serve as the lens through which all decisions are made, easily translating into concrete actions and business strategies. They should be easy to understand, achievable yet inspiring.
Not a zero-sum game
“Today’s stakeholders, especially top talent, expect a company to go beyond business, to make the world a better place,” said Monika Ciesielska, President of IMSA Search. Global Partners. “Companies want leaders who understand their role is to create a net positive impact. It’s not a zero-sum game where someone has to lose for someone else to win. The best leaders are human-centered and put people and their needs at the heart.
She says a strong statement of corporate purpose will clearly articulate that commitment, creating, in the words of Hubert Joly, “engaged employees, satisfied customers, thriving communities and rewarded shareholders.” As the COVID crisis recedes and businesses refocus and rebuild, now is the time to reinvent your business purpose, the report concludes.
IMSA Search Global Partners is an international executive search network with 22 member countries and over 50 offices across Europe, the Middle East, Africa, Asia and the Americas. The members of the IMSA International Executive Search network are all specialized recruitment firms.
Mr. Berger is a board member of IMSA Search and regional director for North America and Latin America. In this role, he focuses on strengthening IMSA’s presence in these regions. He is also CEO of Howard Sloan Research, a business he has helped grow over the past three decades. Under his leadership and guidance, the Howard-Sloan family of companies grew tenfold through organic growth and acquisitions. Howard-Sloan works with public and private Fortune 500 companies, leading law firms, and companies listed on Fortune’s Best Workplaces. to identify and secure their best talents.
Ms. Ciesielska is President of IMSA Search Global Partners, an international network of headhunters. She is also the founder of Carpenter Consulting. For more than 15 years, Ms. Ciesielska has recruited managers, executives and board members, primarily related to sales, online and offline marketing, IT, legal, manufacturing, public relations / communications and purchasing, while cooperating with companies representing each industry, international companies, and Polish key accounts.
Related: What Workers Want May Surprise You
Contributed by Scott A. Scanlon, Editor; Dale M. Zupsansky, editor; and Stephen Sawicki, Editor – Hunt Scanlon Media