Chief Executives for Corporate Purpose (CECP) is a CEO-led coalition that believes that a company’s social strategy – how it engages with key stakeholders including employees, communities, investors, and customers – determines company success. CECP works with companies to explore their purpose and bring it to life through intentional practices and strategies. This practice has grown widely since the founding of CECP in 1999, with Blackrock’s CEO Larry Fink stating at the beginning of the year, “Profits are in no way inconsistent with purpose – in fact, profits and purpose are inextricably linked.”
It’s clear that effective companies cannot ignore social needs in pursuit of profit, but how do businesses navigate what’s coming and what role do they play in solving social challenges? There is also growing evidence that doing well and doing good are not mutually exclusive, that integrating purpose across the business delivers a competitive edge, better performance, more engaged employees, and increased investor interest. “Purpose” is not just a buzzword, as companies and their leaders are bringing this word to life through intentional practices and strategies: presenting long-term plans to investors, offering dynamic giving and volunteer programs to employees, diversifying talent pipelines, and taking values-based stands on social issues. The corporate social engagement space has come a long way from isolated check-writing.
CECP helps companies navigate this rapidly changing landscape. CECP works regularly with leading companies in the utilities industry, most recently at a roundtable where we convened 20 individuals from 12 companies. CECP’s Utility Roundtable Series provides an opportunity for corporate citizenship leaders in the utility industry to connect and learn about industry-specific corporate societal engagement trends.
Utilities serve millions of customers who depend on the consistent delivery of water and electricity every single day. Running a utilities company is uniquely difficult, but the industry has consistently gone beyond the minimum of safety, equipment reliability, and service affordability. So where does the utilities industry stand in driving purpose? According to CECP’s Giving in Numbers report, the survey that delves into the corporate sector’s continuous support of society, utilities companies continue to give back to their communities. From 2015 to 2017, utilities’ median total giving growth rate of 24% was the third-highest of the 10 industries surveyed – following Health Care at 87% and Communications at 41%. Utilities’ median total giving stood at $16.89 million in 2017, with the top quartile giving an average of $28.16 million. The greatest average percentage of utilities’ giving has gone to Health & Social Services (23%), followed by Community & Economic Development (16%).
Beyond giving in cash, the sector has realized the power of giving in service and volunteerism, with non-cash giving making up 5% of total giving in 2017. All 17 surveyed utilities companies offered matching-gift programs to their employees in 2017. The utilities industry also boasted the greatest percentage of companies offering domestic pro bono service programs at 68% -- empowering employees to apply their own set of skills in a flexible way to the causes they care about.
While these statistics show that utilities companies have acted as good corporate citizens, they must keep striving to meet and exceed stakeholder needs, particularly in sustainability efforts. According to a 2018 study by Cone Communications, nearly eight in 10 consumers say they would be more loyal to a purpose-driven company, while more than two-thirds (68%) say they would want to work for a purpose-driven company. CECP’s Strategic Investor Initiative research shows that investors pay attention to purpose and long-term value creation, too, with 83% of investors agreeing that they will move money when they hear a company’s long-term plan. Beyond just doing the right thing, the business case for purpose is stronger than ever.