Patagonia, Ben & Jerry’s and 30 Other Companies Tell the Business Roundtable CEOs to Put up or Shut Up
Tuesday, August 27, 2019
By Michael Grothaus
A week ago the Business Roundtable, a lobbying group composed of the nation’s leading CEOs, including Apple’s Tim Cook and Amazon’s Jeff Bezos, announced a decision to change the definition of the “purpose of a corporation” from solely making money for its shareholders to having a commitment that its actions benefit all stakeholders, including its shareholders, of course, but also including its employees, communities, and the environment.
The Business Roundtable’s decision was huge news considering it proffered upending the decades-old capitalist goal of maximizing profits at any cost to a more holistic goal of looking out for the well-being of everything the company’s actions affects. However, the Business Roundtable’s decision to change the definition of the “purpose of a corporation” isn’t legally binding, which means right now it’s just really good PR.
The thing is, there’s already a group of thousands of companies that are already doing what the Business Roundtable has, so far, only paid lip service to. The B Corporation movement, as its cofounders explained in an op-ed in Fast Company last week, have not only committed to delivering value to all of their stakeholders, not just their shareholders—they’ve gotten legislation passed that legally requires them to do so.
Photo courtesy of geralt.