Organizations have used the last two years of pandemic-induced upheaval to take another look at their purpose. In many cases, this has led to an acknowledgment that the old ways of doing things are no longer viable. However, there is also recognition that what comes next is still a work in progress.
At EY, we’ve long talked about building a better working world being our purpose, and our focus on creating long-term value is part of our ongoing efforts to help businesses develop and track the impact of such purpose-led strategies. Throughout 2021, we uncovered new data and views from institutional investors on how to measure the impact of your purpose in terms of the value it’s able to create.
You can’t improve what you can’t measure
For leaders who believe a purpose-led strategy aimed at long-term value creation for all stakeholders is the bedrock of a successful business, there has long been one thing lacking – a common set of standards by which to benchmark themselves. EY Global Chairman and CEO Carmine Di Sibio outlined 21 core purposeful metrics that can act as a stepping-stone to greater prosperity.
Read more: How common metrics can drive long-term value creation
Five focus areas to drive sustainable value creation
There are certain things that every business, whatever the industry, must focus on if they want to be both sustainable and profitable in the long term. Following discussions with a wide range of CEOs, we identified five critical constituents that are fundamental to a purpose-led growth strategy: trust, sustainability, tech, trade, and people. Discover how developing them within your business will enable you to seize the competitive advantages they can deliver.
Read more: Rebound to more sustainable growth
Investors need more than financials
Institutional investors remain an integral part of the transition to a more sustainable future. Our 2021 EY Global Institutional Investor Survey revealed that investors are increasingly valuing non-financial factors like ESG performance when it comes to their investment strategies and decision-making. While recognizing that a more mature approach to measuring everything from green energy to board diversity is required, we have identified some key actions for businesses to take to ensure their purpose and financial ambitions are complementary, not in conflict.
Read more: Is your ESG data unlocking long-term value?