Business purpose has been brought into sharper focus during the COVID-19 pandemic when we quickly saw what organisations ‘were for’.
A recent EY Leaders' Perspective webinar brought together Mark Cutifani, CEO, Anglo American, and Alison Martin, CEO, EMEA & Bank Distribution, Zurich Insurance Group, to discuss how the COVID-19 pandemic has changed the way we define value and measure success.
A clearer sense of purpose
To set the scene, it’s been noted by many commentators how the pandemic shone a clearer light on the value that businesses create, from putting food on our table to keeping us safe or producing the vital medical equipment that helps us fight the disease.
Given this context, what did leaders have to say about how their organisations’ value and values had shifted? As the leader of a global mining company, Mark Cutifani explained how the pandemic had helped governments see and understand more clearly the value that Anglo American delivers to remote communities. “We became a big player in helping our employees and our community members work and look after themselves in a very new environment,” said Mark.
As the CEO of a global insurance giant, Alison Martin felt that the pandemic has highlighted the imbalances in society, which have contributed to the breakdown in trust between people, business and government. She believes that the pandemic “amplified risks and uncertainties that existed before”, referencing health, income and ethnic inequalities. Part of the problem, she believes, is that “shareholder capitalism is simply too narrow, and businesses truly do need to reflect the full set of stakeholders”.
That may not be as tough a job as it first appears, because the gap between what investors need and what other stakeholders want, is not as big as is often perceived. The investors Alison Martin connects with are thinking about the long-term, looking beyond the latest financial results to consider a wider range of factors. These include the investee company’s ability to attract and retain employees, which in turn relates to broader social issues such as diversity and inclusion. For Alison, Zurich’s ability to generate value extends to “using the skills and capabilities you have to do the things that matter most”, citing an example of Zurich applying its risk expertise to a flood resilience framework that helps keep vulnerable communities safe.