For the purposeful business, a handbook is not enough; it's about how you communicate

What defines a purposeful company? Will Hutton and Clare Chapman of the Purposeful Business Taskforce have begun to answer that question with the publication of their eponymously titled report on the subject.

Purpose is not just found in a handbook, it's about how you communicate it, argues Paul Afshar
Purpose is not just found in a handbook, it's about how you communicate it, argues Paul Afshar

The current political backdrop makes it supremely prescient. A Trumpian White House continues to rewrite corporate America’s relationship with its legislature, while across the pond trust in UK businesses and media has fallen sharply.

Through the report the authors have helped inch us closer towards a more robust measure of purpose. As devotees we no longer have to ask "what would Unilever do?", but have a benchmark, a scorecard if you will, to quantify and qualify progress; one which aligns with corporate reporting standards.

Pioneers of purpose in the comms and CSR world should, therefore, welcome what can only be described as articulate clarity from the authors on how we define the purposeful business.

Measures to promote a more long-term approach to business growth and creating board-level ownership of purpose are vital to rebuild trust.

Creating incentives, including tying executive remuneration to the delivery of purpose and transparent annual reports are more than laudable and if adopted in the Government’s corporate governance strategy would add weight to a long-campaigned-for measure.

But does this 115-page report offer a handbook rather than a roadmap? Assuming a company adopts all the measures recommended and promotes transparency of executive pay, is it purposeful?

The irony in creating what could eventually become accepted standards is that purpose risks becoming a regulatory compliance function.

The alternative is to build businesses that do more than tick boxes. Compliance, as promoted by the report, is only one of several ingredients to purpose.

It is hard to argue against the maxim that purpose, not unlike success, is in the eye of the beholder. A structural definition is necessary, but not complete.

The ability of companies to drive business success through purpose has to be the yardstick.

And central to this is whether customers and consumers perceive the actions of that company as purpose-driven or not.

The young mother does not judge whether a nappy producer delivers on its promise of social purpose because it adheres to GRI4 reporting guidelines. Neither do line items in a company’s annual report on intangible assets fully help promote better understanding of transparency of a fashion label’s customers?

Public understanding and acceptance of purpose is contingent on how it is delivered and, fundamentally, how it is communicated.

Alongside the board-level sponsor needs to be a public-facing champion. CEOs of the Polman and Rometty ilk have been ice-breakers in this respect.

Companies are judged on how they react, not just on how they report: how the oil major reacts to and communicates around a spill, the bravery to stand up and argue for a fairer tax system, or Google’s Sundar Pichai calling out a Muslim travel ban.

All equally important yardsticks in the court of public opinion, and it is this court that tempers purpose as much as the standards promoted by the report do.

If the Purposeful Business Report helps companies begin to objectively measure how they live, breathe and deliver social purpose, then it surely the step we have always been waiting for.

But it is just the first on a long journey to delivering the very thing it seeks to define.

Paul Afshar is director, purposeful business, at FleishmanHillard Fishburn

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