In 2019, Business Roundtable’s 181 member-CEOs shook up the corporate world by proclaiming that companies should no longer exist solely to enrich their shareholders, but should also strive to serve their customers, their employees, the community, and the environment, too—a concept that’s become known as as stakeholder capitalism.
It didn’t come purely from the goodness of their hearts, though, but in reaction to the changing habits of consumers, who increasingly prefer to buy from businesses that put purpose before profits.
Which begs the question that Quartz CEO Zach Seward poses in this episode: Is this change just all talk?
Not according to his guest, former BlackRock senior managing director and global CMO Frank Cooper III (now CMO at Visa), who believes that—especially in the midst of overlapping crises like covid-19, racial injustice, and climate change—the attitude-behavior gap is truly closing in corporate America.
“Employees, customers, and investors are all lining up behind this,” Cooper says. That includes BlackRock itself, whose CEO made a public statement in 2020 calling the enablers of climate change a long-term investment risk.
BlackRock also recently embarked on an internal mission to codify its own higher purpose—helping more people build a healthy relationship with money—and to empower its employees to do the same. By illuminating that process, Cooper hopes to inspire more companies to back up their words with action.
“You have to perform. There’s no doubt about it. But the question is, how do you perform at the highest level, over long periods of time? It’s usually not for money alone. It’s usually not for status. There has to be some sense that you’re contributing to something bigger than yourself. So why not define that?”
Cooper continues, “Inaction is no longer free. If you want to remain neutral, and not have to navigate those other stakeholders, it’s not like the other stakeholders are remaining quiet or they have no power or voice. They do, and they’re going to speak up.”