The Business Roundtable’s controversial new Statement on the Purpose of a Corporation (statement) provides a new opportunity for positive chief legal officer (CLO) engagement with the governing board.
As many corporate counsel are aware, the statement is a call for corporations to adopt corporate purposes to more fully incorporate a stakeholder, as opposed to shareholder, orientation. These purposes include commitments to “deliver value to customers,” “invest in employees,” “deal ethically and fairly with suppliers,” “support the communities in which [they] work,” and “generate long-term value for shareholders, who provide the capital that allows companies to invest, grow and innovate.” In that regard, the statement seeks to redefine corporate purpose away from concepts of shareholder primacy towards promotion of “An economy that serves all Americans.”
