As purpose-led businesses take centre-stage, Robert Phillips and Charles Wookey ask to whom should business leaders be accountable – and for what?
Just as politicians must, business urgently needs to address the global challenges we face, including the climate crisis and growth of populism. The original warning of the Occupy movement “we are the 99%” was as applicable to CEOs as Prime Ministers and Presidents. The future of a better, healthier market economy is as much the responsibility of business as it is of those enforcing policies and regulations. No-one in power listened properly to Occupy a decade ago, just as there are those who too quickly decry the relevance and impact of Greta Thunberg and Extinction Rebellion now.
Powerlessness and exclusion are two of the most obvious drivers of political populism. Both senses manifest in the workplace, too – when workers lack voice, effective participation, or meaningful work. Jericho Chambers, and others, have warned elsewhere of the perils of creating a generation of “bad robot” humans at work, as the fourth industrial revolution takes hold and business leaders all-too-willingly cede responsibility to their tech fetishes and what author Margaret Heffernan has called “the propaganda of inevitability”.
Humanity, genuine participation and accountability are the essential antidotes to the encroachment of powerlessness and exclusion. These principles sit at the heart of purpose-led businesses, which strive to be healthy human systems serving the wider common good of society. They can help arrest the decline.
However, the evolution of “purpose-led” business depends on reimagining accountability. To whom should business leaders be accountable – and for what?
Too many leaders, while recognising the societal imperative and commercial advantage of being “purpose-led”, lack either the cultural or the operational framework to help make it happen. This is why “purpose peddling” is in danger of becoming the new “green washing” – accelerating any shifts towards further social discontent.
The immediate critical riposte from the Council of Institutional investors to the US Business Roundtable statement on purpose is revealing. They said “the statement undercuts notions of managerial accountability to shareholders… accountability to everyone means accountability to no-one.”
This may be a self-serving reaction, but the question is real. Key to a good answer is to recognise a purpose-led business as a series of enduring human relationships, a complex web of promises, commitments and expectations, with employees, customers, suppliers, communities, regulators, future generations and of course investors. At the core of any relationship of dignity and respect is openness to dialogue and acceptance of accountability for decisions and actions that affect others. Businesses seeking to become healthy human systems will want and need a range of accountability mechanisms as vital feedback loops to sustain and support all the relationships on which their enduring success depends.
But what does this mean in practice? How do businesses innovate in forms of accountability when regulatory requirements and measurement systems do not deliver what is needed? Measurement alone is certainly not enough: metrics are too easily created and/or skewed to support the prevailing narrative, purpose-driven or otherwise. Self-selected measurement scores may be conveniently illustrative but risk being neither authentic nor sufficient. Understanding, implementing and holding ourselves accountable for behaviours that drive purpose towards a better society provides the key to determining change for good.
Innovative and bespoke accountability models are required, as well as careful thought about how best to ensure that mechanisms are properly representative of the organisation’s stakeholders and the long-term interests of society. New, co-created, accountability models must reflect this and the Sustainable Development Goals – embracing activists as well as the corporate world; civil society alongside politicians and policy-makers; academics and experts together with institutions. This approach speaks to empowerment over powerlessness; inclusion over exclusion.
“The message is clear from Thunberg and XR: there can be no turning back.”
As the world faces huge challenges including climate change and populism, pressure on business’ License to Operate will intensify, with political and citizen activism on the rise. The message is clear from Thunberg and XR: there can be no turning back. As global businesses including Shell, Unilever and others now recognise, they must take responsibility not only for their own processes and supply chains but also for their customers’ usage, footprints and emissions: their responsibility is to society as a whole.
Accountability within this “societal many, not shareholder few” framework offers both a way of enriching the quality of dialogue necessary to becoming a better business and helps reset expectations, giving organisations nowhere to hide. The discrediting of the “purpose” agenda becomes near-inevitable if no accountability mechanisms are in place. What is needed is radical honesty and openness to support the legitimate purpose and meaningful change. Business has the opportunity to model what society needs, and to help provide an antidote to the sense of powerlessness and exclusion that affects us all.
Robert is the Founder of Jericho Chambers. He created Jericho in 2013 after a 25-year career at the top of the global communications industry. Robert co-founded legendary consumer brands agency Jackie Cooper PR and, having sold the business, went on to become UK and then EMEA Chief Executive of Edelman, the world’s largest public relations firm. Robert is the author of Citizen Renaissance (2008) and Trust Me, PR is Dead (2015). He is a Visiting Professor at Cass Business School, University of London, and speaks around the world on issues of leadership, communications and trust. Robert leads Jericho’s work on Responsible Tax, Good Work, Social Justice in Tech., Housing and Transport.
Charles Wookey is CEO of A Blueprint for Better Business, an independent charity that acts as a catalyst for change in business. Blueprint helps businesses realise their true long term potential: to serve society, respect people, rediscover their purpose and thereby earn a fair and sustainable return for investors. Charles was one of the founders of Blueprint and a key contributor to the thinking behind the Blueprint approach which asserts that people are not solely self-interested and that business is not solely driven by profit. Under his leadership Blueprint has moved from being a small initiative launched in 2012 with a conference that looked at how corporate purpose and personal values could be united to serve society, to an independent charity that is engaged with a growing number of major global companies and whose ambition is to help corporates be truly purpose driven, acting to deliver clear benefits to society as well as delivering long term sustainable performance. From the outset Blueprint has sought to bring together all strands of society.