It is increasingly clear that the CEO who fails to make social responsibility a cornerstone of their company culture risks seeing the company atrophy and fail. This outcome is virtually assured if the company cannot attract the investment capital and young talent needed to fuel its forward momentum. More than ever, ensuring these two ingredients requires a commitment to social consciousness.
Laurence Fink, the CEO of BlackRock, the $6 trillion investment firm, recently wrote to the CEOs of the world’s largest companies, in what the New York Times called “a watershed moment on Wall Street.” Fink wrote, “Society is demanding that companies, both public and private, serve a social purpose. To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society.”
If the world’s largest investor declares he is going to hold companies accountable in this way, others are sure to follow.
The best example I can think of is PanTheryx, the business featured in my book An Unlikely Intervention. The management and board of directors of PanTheryx have always been dedicated to fulfilling the mission envisioned by the founders: create an affordable, easy to use product that serves the poorest and hardest to reach children in underdeveloped countries.
This mission of social responsibility has been imbedded in the culture of the company by the creation of a charitable entity called the Equity of Access Initiative (EAI) to assure these neediest children have access to DiaResQ, a life-saving intervention that combats the worlds #2 killer of children.
Large and small companies alike who fail to respond to Mr. Fink’s admonition are highly unlikely to attract and retain high caliber young talent, like millennials, who want to work for companies that are committed to helping improve society.
Recent studies from Deloitte are unequivocal on this point: “companies and senior management teams that are most aligned with millennials in terms of purpose, culture, and professional development are likely to attract and retain the best young talent and, in turn, potentially achieve better financial performance. Loyalty must be earned, and the vast majority of millennials are prepared to move, and move quickly, for a better workplace experience.
Bottom line: creating a corporate culture of social responsibility is no longer an option; it is imperative for long term survival.