NEW YORK, Sept. 17, 2020 /PRNewswire/ -- Eight in-10 (83%) executives today feel an urgency for business to be a critical part of driving solutions to some of today's most pressing issues, such as COVID-19, racial injustice, and economic resurgence, according to the 2020 Porter Novelli Executive Purpose Study. The study, surveying 150 C-suite business executives at companies with revenues of more than $500 million, examines business leaders' opinions on Purpose-driven leadership and how business should engage on issues like social justice and diversity, equity and inclusion (DE&I) within the context of 2020's rapidly changing environment.
"It's clear the events of this year have fundamentally changed the business environment – as well as the role of business in society," says David Bentley, CEO, Porter Novelli. "There is more urgency than ever before for business to be a leading player in solving for critical global issues – and smart leaders recognize taking a stakeholder-first lens is not only good for society and communities – but also for business and bottom lines."
Mirroring this mindset, the majority (85%) of business leaders today agree it is no longer acceptable for companies just to make money; companies must positively impact society as well. Further, executives are eschewing an investor-only focus – with more than nine-in-10 (91%) stating that business must benefit all stakeholders, not just shareholders.
Executives agree leading with Purpose drives profit
As more companies turn to stakeholder-centered business, executives understand this is not simply about "doing the right thing", it is also a sound business strategy. Nearly nine-in-10 (89%) business leaders today believe companies that lead with Purpose have a competitive advantage in today's marketplace. In fact, 85 percent agree being a Purpose-driven company drives profit.
Beyond heightened profitability, executives also identify a number of other business benefits of leading with Purpose. Nearly all executives (99%) see the reputational advantages of responsible business – and the majority also cite employee recruitment and retention (95%) and increased consumer trust (93%). Additional benefits include:
- Increased customer loyalty: 93%
- Likelihood to recommend: 92%
- Likelihood to purchase: 91%
- Differentiation from peers and competitors: 88%
- Improved financial performance: 83%
- License to operate: 65%
"This year is anything but 'business as usual'," says Bentley. "Yet, 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. Purpose-driven business is smart business, and now is the time for executives to eliminate barriers and take a stand. It's time for action, plain and simple."
COVID-19, racial injustice put business mandate in new focus
The events of the past six months have only put this mandate into clearer focus, as 88 percent of business leaders believe now more than ever, companies must lead with Purpose. Many feel a responsibility to fill an emerging leadership vacuum – with eight-in-10 (80%) believing that due to the lack of government regulation and progress, business has more of a role than ever to address pressing social and environmental issues. A similar amount believe business is uniquely equipped to solve these issues – with 81 percent noting business has the scale, speed and acumen to solve the issues facing society today – including COVID-19 and economic resurgence.
"We've tracked consumer expectations of companies during the pandemic and around topics like racial injustice since the onset of the crisis. It's clear that Americans believe companies must play a central role in building solutions for today and tomorrow," says Kate Cusick, CMO, Porter Novelli. "Now, this research proves that business leaders not only acknowledge this mandate but are also ready to take the reins and run."
Business + social justice – where executives stand
As 2020 continues to shed light on a long, painful history of racism and disparities in the U.S., business executives are prepared to engage. Recent Porter Novelli research has found that seven-in-10 (70%) Americans today believe companies have more responsibility than ever before to address social justice issues – and business executives (73%) echo this fervor. A similar amount (71%) understand that to truly be Purpose-driven, a company must be willing to take risks to address social justice issues – a figure also in alignment with the American public (72%). Just a third (36%) of business leaders today say business should focus on business, not social justice.
On the specific issues business leaders feel they have a role in addressing, issues closer to their everyday business and operations are the priority. Executives rank sexual harassment (97%), employee health and safety (95%), racial equality (93%) and women's rights (89%) as the top issues active in the news today that companies must address. Additional issues include:
- Access to healthcare: 87%
- Domestic job growth: 86%
- Privacy and internet security: 84%
- LGBTQ+ rights: 78%
- Immigration: 63%
- Climate change: 61%
- Voting rights/access to voting: 55%
- Cost of higher education: 43%
- Fake news: 37%
- Gun control: 31%
"While most executives recognize the need to engage, our benchmark research indicates average Americans are even more fervent in their belief that business should be prepared to solve for myriad social justice issues plaguing society today," says Cusick. "In order to drive change, Corporate America's C-suite need to get outside their comfort zones in addressing these diverse issues that are now an expectation of consumers, employees and other stakeholders."
Specifically, on the topic of racial equality, three-quarters (76%) of executives recognize business' role in systemic racial inequality – mirroring the national average. Even more (85%) understand their responsibility as business leaders to speak out about injustices. Yet, executives know part of the journey forward is to also acknowledge the past. Another six-in-10 (60%) want to be more proactive about sharing previous mistakes or biases rather than waiting for someone else to publicize them – and just a third (33%) concede they are nervous to take this step.
But barriers remain to taking stands on social justice issues
Even as the majority of business leaders today acknowledge business can play a critical role in addressing the many social justice issues, barriers remain to further pursuing these topics. When asked what prevented leaders from taking a stand of social justice issues, leaders cite the number of stakeholders all wanting different things (43%) as the primary reason. Other top reasons include concern that their company hasn't done enough internally to take a stand (28%), too many issues (27%) and a hesitancy to invite retaliation from different stakeholder groups (27%). Other barriers executives cited include:
- Board and key decision makers are too risk-averse: 25%
- Company already has a signature cause/issue, don't want to detract from that work: 24%
- Afraid consumers or other stakeholders will negatively call their company out for not being "authentic": 21%
- Don't feel their company has a role in taking stands on these issues: 21%
- Consumers expect immediate action and their company can't respond quickly enough: 19%
- Company doesn't have the money or resources to make an impact on these issues: 15%
- Issues are moving too quickly for their company to be thoughtful in its response: 14%
- Don't know where to start in addressing the myriad pressing issues: 14%
"Executives today acknowledge the complexity of taking a stand on a potentially delicate issue – from recognizing different stakeholder priorities and understanding they must do work internally to justify leadership," says Cusick. "Here we see how these hurdles can quickly become insurmountable barriers for companies that do not already have a strong vision and Purpose to guide them."
Business leaders cite DE&I as a moral and business imperative
As business leaders look to tackle tough social societal problems, they understand having a diverse and vibrant workforce is one step forward. Executives today recognize the value of powerful diversity, equity and inclusion (DE&I) strategies – nearly three-quarters (73%) believe DE&I is a moral and business imperative that drives profit, and only a third (35%) of executives today say DE&I isn't a core business priority for their company. Executives (84%) are also significantly more likely than the average American (69%) to believe a company cannot be truly Purpose-driven without having strong DE&I values – showing how leaders understand that Purpose and DE&I are inextricably linked.
Leaders also acknowledge there is much work to be done in this space. Nearly nine-in-10 (89%) executives say companies need to make more progress on advancing DE&I in the workplace – compared with 76 percent of Americans overall. Two-thirds (65%) take this personally, admitting they need to make DE&I more of a priority at their company.
ABOUT THE RESEARCH
Porter Novelli fielded a survey to gather insights regarding Purpose-driven companies and social justice. The U.S. business executives survey was fielded online via GLG between July 21 and July 24, 2020, and a total sample of 150 business executives was collected.
ABOUT PORTER NOVELLI
Porter Novelli is a global purpose communication consultancy born from the idea that the art of communication can advance society. More than 45 years ago, we opened our doors – and people's eyes and minds – for brands driven to make a positive impact. Today, we believe that organizations must find, live and tell their purpose in order to thrive. Those companies will motivate action, secure loyalty and encourage advocacy — all in service to a healthier bottom line. For additional information, please visit www.porternovelli.com/. Porter Novelli is a part of the Omnicom Public Relations Group.
ABOUT OMNICOM PUBLIC RELATIONS GROUP
Omnicom Public Relations Group is a global collective of three of the top global public relations agencies worldwide and specialist agencies in areas including public affairs, marketing to women, global health strategy and corporate social responsibility. It encompasses more than 6,300 public relations professionals in more than 370 offices worldwide who provide their expertise to companies, government agencies, NGOs and nonprofits across a wide range of industries. Omnicom Public Relations Group delivers for clients through a relentless focus on talent, continuous pursuit of innovation and a culture steeped in collaboration. Omnicom Public Relations Group is part of the DAS Group of Companies, a division of Omnicom Group Inc. (NYSE: OMC) that includes more than 200 companies in a wide range of marketing disciplines including advertising, public relations, healthcare, customer relationship management, events, promotional marketing, branding and research.
SOURCE Porter Novelli