Company purpose and profit are not mutually exclusive
The view that a company may be either “profit-seeking” or “purposeful” is overly simplistic, with serious consequences for board accountability.
Image: Khakimullin Aleksandr/Shutterstock
The past few years have seen a vivid international debate about the purpose of companies and the purport of their directors’ duties towards various stakeholder groups, pursued against the backdrop of mounting expectations on companies to play an active role for the accomplishment of various societal goals.
The debate gathered particular momentum with the announcement by the European Commission in March 2018 of its intention to assess “the possible need to clarify the rules according to which directors are expected to act in the company’s long-term interest”.
Since then a host of articles, books, study reports and open letters ha
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