This blog post is part of the HBR Online Forum The CEO’s Role in Fixing the System.I recently heard that the only group held in lower regard than corporate executives in the United States is Congress. Wow! Think about that. What a terrible blow to business. And yet, I’d argue that it’s our own fault. By serving narrow self-interests, we — the business people of this country — basically facilitated this mistrust. We have been purveyors of our own doom. There’s a reason the Occupy Wall Street movement was hatched and a reason why its message is growing more pervasive.
The shine on corporate executives has been more than just tarnished by the economic events and hardships of the past three years. It’s all but gone. Too many corporations view their role as extracting profit (“hit the numbers!,” “deliver the bottom line!”) from society as opposed to viewing profit as a byproduct of delivering a valued service over the medium and long term. A stock pop on the heels of the release of monthly sales results contributes little to customers, employees, or communities, and yet that is exactly what all too many corporate executives are focused on and live and die by.
Given that we — the business people of this country — are responsible for our bum rap, I think we’re also responsible for restoring its luster.
Enter new approaches to capitalism — some are calling it conscious capitalism or enlightened business. I’d call it simply “enlightened self-interest.” This notion of a conscious and long-term approach to value creation — when put into proper application — serves long-term shareholders extraordinarily well and has the capacity to favourably reshape the public’s perception of corporate America. It is built on the fundamental premise that every business has a deeper purpose than merely short-term profit maximization and, more importantly, a responsibility to all of its stakeholders (customers, employees, vendors, investors, community). With such a model, profit is merely the byproduct of delivering something that serves society and a broad range of stakeholders.
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