The future of purpose-led business: steadying the ship
Context
Jericho Chambers and Blueprint for Better Business hosted an informal roundtable conversation in November to explore the evolution of “purpose-led business” in the UK. The aim was to sense-check how practitioners in this space are experiencing recent progress and changes in sentiment in the UK and globally, disentangle some of the confusion in the current debate over “woke” capitalism and identify helpful strategies within the current context for businesses committed to being agents of lasting positive change.
The conversation was held under the Chatham House Rule and was attended by eleven expert participants (see below for a list of contributors).
Where are we?
Competitive edge or mere do-goodery? What is the current context for purpose-led business in the UK and further afield?
Participants observed that businesses have shifted significantly from the old Milton Freidman view, which focused solely on profit, towards a model that seeks purpose beyond short-term profit maximisation. The market’s sentiment has changed, now valuing thoughtful integration of purpose-led initiatives and a modern perspective that businesses should address broader societal issues, even if it doesn't lead to greater profits. However, this has not been without challenges (more on this in the next section).
One participant noted that from what they’re seeing, the rise of Environmental, Social, Governance (ESG) as a concept reached a peak in 2022, when it was considered both profitable and aligned with corporate ambitions to project purpose-led values. Since then, however, some stakeholders have pushed back, citing concerns over the perceived lack of traction and the unintended weight given to ESG. Participants pointed out that the complexities of ESG integration are also more nuanced than initially anticipated.
The pandemic served as a notable inflection point, amplifying discussions around corporate purpose and responsibility. Yet, this period of reflection also left many uncertain about what to expect from businesses moving forward. If a company’s responsibilities extend beyond its shareholders, to whom should it be accountable? This question takes on renewed urgency in the face of changing political landscapes and economic challenges with some wondering if recent election results (particularly in the US) might well prompt a return to the Friedman doctrine, and shareholder primacy.
Several participants noted that the concept of “purpose” has often been mischaracterised as mere "do-goodery," resulting in performative rather than genuine commitments. This perception has led to an ongoing conversation around the true meaning of purpose and the risks of shallow engagement. Purpose can also be seen as something that gives business a competitive edge in terms of an attractor for talent and market share – and not just in terms of a society and environment in which business can thrive in the medium to long term.
In the UK, attitudes towards purpose-led business are complex. While there is no overt hostility, there is also a sense that the environment may not be as supportive as it once was. Observers noted a subtle inclination to favour “traditional” business practices, with some discontent around issues perceived as “HR overreach” or “wokeism.”
What are the barriers?
The difficult second album: What obstacles are hampering progress?
Moving from establishing principles to actually embedding purpose deeply within organisations presents unique challenges. One participant referred to it as the "difficult second album".
Authenticity is a real issue. Several participants noted that some organisations appear to pursue certifications such as B Corp for perceived financial/ reputational advantage rather than for genuinely principled reasons. Both "purpose-washing" (involving a disconnect between a company’s stated purpose and its actual actions, manifesting in various ways) and "purpose-hushing" (opting for silence even when providing real benefit in order to avoid scrutiny) damage the argument.
Beyond purpose-washing, there’s a deeper challenge too, that even if a business genuinely holds to and acts upon its stated purpose, the validity of that purpose itself can be questioned. The example given was that of the vitamin supplements industry who may bring benefit in alignment with their purpose but only a fraction of its target audience. This raises broader questions about the limits and societal impacts of "good" purposes and how they relate to a company’s integrity.
Additionally, in the US, it was suggested, there is also outright “purpose-bashing” reflecting an active resistance against the purpose agenda. The politicisation of ESG has turned it into a polarising issue, rendering the term itself toxic.
Participants also noted that accurately costing the necessary changes is complex, especially since these expenses have not been standard. Boards, often risk-averse, find the inherent unpredictability of this costing complexity challenging.
It was also noted that we are in a "pre-disclosure" phase regarding regulation, where companies are not yet expected to be fully transparent about their purpose-driven and sustainable efforts. Moving into a regulated disclosure phase would shift expectations, likely bringing both increased accountability and scrutiny.
Participants discussed an observed shift, transferring purpose from a corporate strategic focus into the HR function. While this can foster a strong cultural alignment around purpose, moving it out of strategic decision-making risks weakening its impact.
Furthermore, some participants expressed concern over an apparent reluctance to address the intricate challenges that come with progressing from initial engagement to deeper purpose integration. Incumbent leadership, facing mounting pressures to address deeper issues, find themselves struggling to make the necessary changes within limited timeframes. Participants suggested that frequent leadership turnover impedes sustained progress and long-term strategy.
Lastly, participants noted the growing weakness of UK businesses in the global landscape as a critical challenge. With the survival of some companies potentially at risk within five years, there is limited enthusiasm for initiatives seen as “nice to have” rather than essential. They also highlighted the scarcity of real-world examples of sustained purpose-driven transformation.
What next?
Standing at the edge of the cliff. What strategies can we adopt to accelerate the purpose-led business movement?
It was commented that businesses have come pretty far and have now tackled the low-hanging fruit when it comes to purpose. The challenges they face now are more difficult and fundamental, it was described by one participant as being “on the edge of the cliff looking over”.
Participants agreed that there is a need to reframe the conversation around purpose, detaching it from polarising viewpoints and translating it into clear, universally understood language. Reframing responsible business as “sustainable profitability” or “sustainable success”, as examples, could help to make the concept more relatable; linking it to both short-term success and long-term resilience. This shift could help attract broader support by making purpose both tangible and accessible.
For purpose to resonate genuinely within organisations, it must be deeply aligned with self-reflective and democratic/participatory practices. Purpose can’t be imposed – only negotiated organically. Embedding these principles can be challenging and a renewed focus on essential societal needs such as poverty alleviation and climate action, was deemed necessary. With anticipated pressures due to low economic growth and stagnant living standards, businesses must be ready with adaptable strategies.
Participants argued that the climate crisis should no longer sit on the periphery but be central to business strategy itself. Achieving this transition will require considerable momentum, education, and collective action. Purpose-driven organisations, should prioritise these root issues, embedding purpose within their core functions.
Participants also stressed the importance of unified action. While many businesses work towards positive change, a collaborative approach would amplify impact, fostering shared learning and helping to drive forward the purpose movement collectively. An "abundance mindset" in terms of human capacity was encouraged, focusing on how responsible business can support both societal well-being and profitability.
Transparency was viewed as fundamental and participants emphasised reinforcing the business case for purpose, as a coherent and purpose-driven strategy is key for attracting talent and ensuring organisational relevance.
Participants acknowledged the private sector’s substantial influence, noting that family-owned businesses are particularly well-placed to lead by example in the purpose space; given their lower exposure to short-term shareholder pressures. Their natural inclination towards long-term stewardship offers them unique potential to navigate this transformation.
Participants generally agreed that this moment represents a critical inflection point with the chance to regroup and drive meaningful progress but in both more nuanced and deeper ways. Discussion emerged around how a shift from populism towards "peopleism", placing people-centred values above populist rhetoric, could provide an alternative way to frame and promote purpose-led goals that resonate widely.
They reflected that the purpose movement is now in a demanding phase, characterised not by retreat but by confronting the intricate, foundational changes needed to achieve sustainable impact. This moment calls for resilience, patience, and a readiness to adjust, recognising that there is no fixed roadmap for becoming a genuinely sustainable business.
Next steps
The objective of the event was to tip the thinking and experience of the group onto the table. This note shows a wide range of perspectives and insight. The context tells us this moment could be pivotal. But what to actually do next that will make a meaningful impact on both purpose thinking and practise?
Clearly, more people need to be engaged in a conversation and proper research needs to be conducted into both the status of purpose and what has worked and what hasn't.
Out of that could come recommendations in terms of both language and concrete ideas about how firms pursue the purpose agenda more effectively, citing examples and case studies.
If you want to help and work with us on this please get in touch.
Appendix: The conversation was attended by:
Sarah Gillard, CEO, A Blueprint for Better Business
Adam Grodecki, Director, Forward Institute
Helen Hay, Group Culture & Sustainability Director, Ampa
Andrew Hill, Associate Editor & Management Editor, Financial Times
Becky Holloway, Partner, Jericho
Neal Lawson, Partner, Jericho
Dr Sally Uren OBE, Chief Executive Officer, Forum for the Future
Sarah Walker-Smith, CEO, Ampa
Grant Wardell-Johnson, Global Tax Policy Leader, KPMG
Becky Willan, Co-founder and CEO, Given Agency
Charles Wookey, former CEO, Blueprint for Better Business