Alfred Rappaport, Columnist

How CEOs Can Forge a New Kind of Shareholder Value

The Business Roundtable’s headline-making new statement on corporate purpose left out a lot of important things.

We’re listening.

Photographer: Rick T. Wilking/Getty Images

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The Business Roundtable, the organization for chief executive officers of large U.S. corporations, got a lot of attention last month with its revised “Statement on the Purpose of a Corporation.” The document, signed by 181 CEOs, calls for companies to serve all stakeholders by delivering value to customers, investing in employees, dealing fairly with suppliers, supporting the communities in which companies operate and protecting the environment. It also offers a vague commitment to “generate long-term value for shareholders.”

Many commentators in the media, as well as prominent politicians, greeted the Roundtable statement as a significant shift from shareholder primacy to a new governance structure with a deepened commitment to corporate social responsibility. However, there is good reason to question this, because of what the Roundtable statement does not tell us.