Jennifer Prillaman | Palladium - Nov 08 2019
Inclusive Growth Starts with Employees, According to CEOs

Source: The Aspen Institute

In August, Business Roundtable famously declared that corporations' traditional focus on shareholder return should now include a commitment to all stakeholders, including customers, employees, suppliers, and the environment. Last month, Business Roundtable President Josh Bolten discussed this shift with other U.S. business leaders at the Global Inclusive Growth Summit, hosted by the Mastercard Center for Inclusive Growth. Throughout the lively debate, panellists agreed that the best-run U.S. businesses are focusing more on investing in their employees, and in initiatives that impact their home markets.

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

Skills for a Sustainable Workforce

Bolten explains that many of the "best businesses" in the U.S. are ensuring their employees are properly trained for today's – and tomorrow's – jobs. He describes a lack of skills in the rapidly changing economy as "one of the things tearing most at our societal fabric." With training, businesses are benefitting their current employees but also ensuring the sustainability of their future workforce.

Palladium CEO Christopher Hirst has agreed: "Investment in inclusive growth allows companies to profitably improve skills, productivity, and commitment of employees and suppliers, while also finding new and differentiated market opportunities in communities currently being left behind."

Taking Care of Employees

Forbes recently reported that people want to work for companies who are trying to change the world for the better, giving them a mission they can work towards that isn't just a salary.

"There's no question that you now have employee activism," says Andrea Jung, President and CEO of Grameen America. She warns that if a company is doing harm to stakeholders, both customers and employees will boycott the brand.

"It's creating the urgency to do the right thing, which we've known all along."

But it's not just about the company's overall mission. Businesses must also focus on employee benefits, diversity, pay gaps, and training. Anne Finucane, Vice Chairman of Bank of America, recognises that companies should start with how they treat their employees. "You've got to demonstrate to your own people first, to the communities in which you work and live."

"Communities" Aren’t Just Abroad

In some contexts, supporting the communities in which businesses work is assumed to mean communities overseas, in developing countries at the beginning of the supply chain. But Mike Froman, Vice Chairman of Mastercard, warns that we need to recognise the challenges of inclusive growth are not just in emerging markets in other countries. We must not lose sight of those being excluded in the U.S. and home markets.

He asks, "What lessons do we learn from all around the world that we can apply to markets like this to have a positive effect?"

When expanding the purpose of the corporation, these CEOs are starting at home: with their employees and domestic markets.