More than eight in 10 executives at large companies believe for-profit organizations should play a significant role in resolving social issues such as diversity, equity, inclusion and social justice, according to the 2020 Porter Novelli Executive Purpose Study.
A like number — 85 percent — also hold that companies have a responsibility to improve society in addition to generating profits, and 91 percent believe resulting benefits from their actions should include considerations of those beyond shareholders.
Porter Novelli fielded its survey between July 21 and July 24, 2020. Data is based on responses from 150 business executives. Executives’ reasoning behind their beliefs is not entirely altruistic. Nearly all said businesses that act for social betterment receive benefits such as employee recruitment and retention and customer trust advantages. Additionally:
- 93 percent said businesses would generate increased customer loyalty;
- 92 percent said customers would be more likely to recommend their offerings;
- 91 percent said customers would be more likely to make a purchase;
- 88 percent said being socially active would differentiate their businesses from their competitors; and,
- 83 percent felt their actions would result in improved financial performance.
“This research proves executives understand this time of immense crisis has also created a moment to build back the business community as a more vibrant, inclusive, innovative, and profitable endeavor that serves all stakeholders instead of just shareholders,” David Bentley, CEO of New York City-based marketing consultancy Porter Novelli, said via a statement. “Purpose-driven business is smart business, and now is the time for executives to eliminate barriers and take a stand.”
Businesses need to step up because traditional mechanisms are failing society, according to executives surveyed. Eight in 10 said lack of government regulation and progress has resulted in an urgent need for businesses to address social and environmental issues. Some 81 percent believe the industrial sector has the speed, scale and acumen to solve today’s pressing issues, such as recovery from the coronavirus pandemic and economic recovery.
Executives realize there is some risk in businesses embracing social issues. Just slightly more than seven in 10 (71 percent) think a company needs to be willing to take risks to be “purpose-driven,” a figure in line with the 72 percent of Americans who believe similarly.
Issues that immediately impact corporate operations place highest among the concerns executives believe businesses should address. They rank combatting sexual harassment (97 percent), employee health and safety (95 percent), racial equality issues (93 percent) and women’s rights (89 percent) among the most pressing concerns.
Other issues mentioned include:
- Access to healthcare: 87 percent
- Domestic job growth: 86 percent
- Privacy and internet security: 84 percent
- LGBTQ+ rights: 78 percent
- Immigration: 63 percent
- Climate change: 61 percent
- Voting rights/access to voting: 55 percent
- Cost of higher education: 43 percent
- Fake news: 37 percent
- Gun control: 31 percent
Changing corporate culture to allow for more social responsibility won’t be easy. More than four in 10 executives (43 percent) said their stakeholders would want different goals. Nearly three in 10 (28 percent) feared their company hadn’t done enough internally to take a stand, and almost as many (27 percent) thought either there were too many issues, or that taking stances would invite retaliation from various stakeholders.