The role of the corporation in society is under review. The paradigm that corporations are run solely in the interests of shareholders, which has defined a generation of management practice, is being contested. The emerging paradigm references “stakeholders” as the broader group that managers should consider in decision-making. Such a transition is full of complexities for chief executives, investors and policy makers.

In this paper, we seek to highlight a few implications of corporate purpose—in its stakeholder aspect. We look at whether a clear corporate purpose can impact the valuation of listed equities and how that relationship to value may arise. To study the impact of purpose on performance, the authors conducted new analysis on how corporate purpose relates to company financial performance, market valuation and shareholder value creation. The analysis highlights how effective investment in corporate purpose can deliver value to both stakeholders and shareholders.