Business and Society Program

The Purpose of the Corporation

Business corporations are perhaps the most influential organizations in society and have long been recognized as important contributors to the common good. Society grants corporations unique privileges in order to harness their great capacities to serve its needs. Yet the current narrative of the business corporation tells a different story; corporations have the sole purpose of maximizing profits for shareholders.

Aspen BSP is conducting a series of off-the-record and public dialogues among scholars, business leaders, and investors to explore this divergence and broaden thinking about the corporate objective function beyond shareholder wealth maximization.

The ways a company views its purpose are enormously consequential, not only to ensure corporate accountability, but perhaps more importantly as the architecture for value creation. Purpose is a firm's vision for the value it seeks to create and how that value is created; it defines what the corporation is and does, whom it serves and how it contributes to the well-being of society

For more information, contact Miguel Padro at miguel.padro@aspeninstitute.org.

Recent Event

Feb. 27-28, 2014  |  Evanston, IL

Hosted by the Kellogg School of Management and the Aspen Institute Business & Society Program

For more information please visit the conference website.

Daniel Diermeier, Professor at the Kellogg School of Management, explains the significance of the issue to be addressed in this year's Business and Society Leadership Summit.

 

Past Events

Academic-Practitioner Roundtable Series: Rethinking "Shareholder Value" and the Purpose(s) of the Corporation

Lynn Stout
Cornell Law School Professor, Lynn Stout at the September, 2011 roundtable at UCLA School of Law

Roger Martin, Henry Hansman & Stephen Bainbridge
Left to right: Stephen Bainbridge (UCLA Law), Henry Hansmann (Yale Law School) and Roger Martin (Rotman School of Management at University of Toronto)

  • March, 2013 at the Kellogg School of Management
  • November, 2012 at Wharton School, University of Pennsylvania
  • March, 2012 at NYU Stern School of Business
  • September, 2011 at UCLA School of Law
  • Who is participating in the roundtables?
    • Practitioners from: The Acumen Fund, Alcoa, The Alfred P. Sloan Foundation, BlackRock, B-Lab, Capital Research and Management, The Delaware Court of Chancery, Deloitte Touche Tohmatsu, Eli Lilly, Evergreen Cooperatives, GE, Generation Investment Management, Nelson Capital, Pfizer, Prudential, TIAA-CREF, Weil, Gotshal & Manges
    • Business Scholars from: Kellogg School of Management, NYU Stern School of Business, St. Mary's College of CA.,UC Berkeley - Haas School of Business, University of Chicago Booth School of Business, University of Michigan - Ross School of Business, University of Toronto - Rotman School of Management, University of Virginia - Darden School of Business, The Wharton School at UPenn, Yale School of Management
    • Law Scholars from: Boston College, Columbia University, Cornell University, Fordham University, Rock Center for Corporate Governance at Stanford University, Seattle University, UC Berkeley, UCLA, University of Illinois, University of Pennsylvania, University of San Diego, University of Virginia, Vanderbilt University, Washington and Lee University

Book Talk: The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public by Lynn Stout
June 20, 2012 - Aspen BSP and Cornell Law School sponsored a book talk on Professor Stout's latest book, moderated by Jesse Eisinger (ProPublica, New York Times)

Aspen Ideas Festival Panel: "Has Maximizing Shareholder Value Endangered America's Greatest Companies?"
Other than stock price, how can you measure value? (Embedded here)


July 1, 2012 - Moderator: Joe Nocera (Op-Ed Columnist, New York Times). Panelists:
Professor Tom Donaldson (The Wharton School, University of Pennsylvania), Shelley
Lazarus(Chairman, Ogilvy and Mather), Howard Schultz (CEO, Starbucks), Professor
Lynn Stout (Cornell University Law School).

Why is focusing on share price bad for shareholders?

Why do companies have trouble creating purpose?

Resources:

Reading Collections:
Purpose of the Firm (2011)
Corporate Governance and Accountability Project (2011)
What the Law Allows (2005)

Speeches:
The Purpose of the Corporation (December 12, 2011)
In a speech at the Brookings Institute, David Langstaff, CEO of TASC Inc. and chair of Aspen BSP's advisory board, argued that a "citizenship view" of corporate purpose is essential to restore the foundation of "good capitalism.

Blogs:

Is Success Even Possible in This 'Powerball' Economy? (December 17, 2012)

What Do 3 Million Job Openings Tell Us About the Skills Gap? (December 5, 2012)

How Modern Corporate Structure Contributed to the Financial Crisis (November 7, 2012)

Joe Nocera Rebukes Shareholder Value Focus (August 14, 2012)

Can Goldman Sachs Find Its Purpose? (March 20, 2012)

Steve Jobs Made Sure Apple's Main Mission Was Satisfied Customers, not Profits (October 11, 2011)

All Businesses Should Have a Public Purpose, Not Just 'B-Corps' (July 29, 2011)