Pensacola, Florida
Tuesday September 17th 2019

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Outtakes—A Profound Shift

By Rick Ouzten

The Business Roundtable, which represents chief executive officers of America’s leading companies, on Monday redefined the purpose of the corporations in a statement signed by 181 CEOs. The statement expanded the purpose beyond benefiting primarily shareholders to include other stakeholders—customers, employees, suppliers and communities.

“The American dream is alive but fraying,” said Jamie Dimon, chairman and CEO of JPMorgan Chase & Co. and chairman of Business Roundtable. “Major employers are investing in their workers and communities because they know it is the only way to be successful over the long term.”

“This new statement better reflects the way corporations can and should operate today,” added Alex Gorsky, chairman of the Board and Chief Executive Officer of Johnson & Johnson and chair of the Business Roundtable Corporate Governance Committee. “It affirms the essential role corporations can play in improving our society when CEOs are truly committed to meeting the needs of all stakeholders.”

The CEOs that signed the statement lead companies like International Paper, AT&T, Amazon, Aflac, Coca-Cola, Ford Motors, Home Depot, Target and Walmart. Unfortunately, three corporations with Pensacola connections didn’t sign the statement—State Farm, GE and Gulf Power’s new owner, NextEra Energy.

“This is tremendous news because it is more critical than ever that businesses in the 21st century are focused on generating long-term value for all stakeholders and addressing the challenges we face, which will result in shared prosperity and sustainability for both business and society,” said Darren Walker, president of the Ford Foundation.

The new statement is profound because businesses don’t operate in a vacuum. Too many times, large corporations have abandoned the communities that have supported them for higher profit margins elsewhere, leaving huge holes that have become nearly impossible to fill.

Over the years, we’ve seen some of this area’s largest employers take smaller roles in our community as their corporate leaders, who are headquartered elsewhere, have taken community service out of the performance metrics for local operations. The Pensacola Chamber, FloridaWest, First Place Partners and other local boards have fewer corporate heavy-hitters serving on them.

It wasn’t that long ago that all those boards would include the senior leaders of Solutia, International Paper, Armstrong Industries, Air Products, Cox, AT&T, Navy Federal Credit Union, Gulf Power, all three hospitals and every bank. Things got done because business leaders looked beyond their corporate profits.

The Business Roundtable statement is an important shift for big business because it proclaims the value in meeting or exceeding customer expectations, investing in employees by paying fair wages, providing benefits and supporting training and education, dealing fairly and ethically with suppliers and supporting the communities in which they work.

Let’s hope it takes root in Pensacola.