Published Online:September 2024
Product Name:The IUP Journal of Effective Executive
Product Type:Article
Product Code:EE020924
Author Name:Colin Coulson-Thomas
Availability:YES
Subject/Domain:Management
Download Format:PDF
Pages:26
Whether a purpose-driven organization is desirable will depend upon the purpose in relation to stakeholder aspirations, concerns and requirements, and the situation, circumstances and context. This paper examines what corporate purpose and a purpose-led business might mean for corporate governance, the quality, value and growth that are sought, independent directors, ESG and sustainability, diversity and the role of future boards. It presents questions that directors could consider in relation to selected items on board agendas when balancing contending claims upon resources, establishing priorities and endeavoring to become and remain purpose-led. A corporate purpose should reflect global risks, existential threats, challenges and opportunities, be responsible, sustainable, inclusive and appropriate for the wider contexts in which a company is active and could have an impact. As situations, circumstances and contexts change and/or evolve, a purpose may need to be revisited, reviewed and redefined, flexibly interpreted and intelligently implemented if it is to be resilient and remain relevant. Where this does not happen, and interests and parties become more aware of the costs and negative consequences and implications for themselves of certain purpose-led and/or ESG initiatives, they may seek to delay their implementation and/or prevent their achievement.
Questions have been raised about what a company is for and/or what the purpose of a company should be(Handy, 2002; and Mayer, 2018). Factors, views and/or developments influencing the purpose of an entity and a rationale for its aspirations, activities, policies and priorities could be internal or external, or result from the interaction of the two.