The CEO of the Business Roundtable on the Statement of the Purpose of the Corporation: Josh Bolten talks about the impact of the statement's update a year later.

• Author: Bolten, Josh
• Position: THE CHARACTER OF THE CORPORATION

Directors & Boards' Character of the Corporation forum closed with a keynote interview with Josh Bolten, CEO of the Business Roundtable.

A little over one year ago, The Business Roundtable updated its "Statement on the Purpose of the Corporation," which called on corporations to not only serve shareholders, but also stakeholders inside and outside of the company. Bolten reflected on how that statement has impacted corporate America since its release.

Byron Loflin, global head of board engagement for Nasdaq, conducted the interview.

This content has been edited for clarity and length.

Byron Loflin: Here we are, a little over a year into the Business Roundtable announcement on purpose. What are your observations on the work that you've done since the announcement a year and a few months ago?

Josh Bolten: I'm very proud of the Roundtable's statement of corporate purpose. The Business Roundtable had long maintained a statement on the purpose of a corporation. But that statement had been unchanged since the mid '90s. We decided over the course of well over a year that that statement no longer reflected the reality of the way CEOs and boards were seeing corporate mission and that we needed to update it. In August of 2019, we put out a new statement that said that the purpose of a corporation is to promote all of its stakeholders: its customers, employees, suppliers, communities and shareholders. I emphasize shareholders here because this gets dropped sometimes in commentary on the statement.

I'm proud of the statement in several respects. One is the spirit and principles that underlie it. The second is that it gives the public a more accurate reflection of what we think CEOs are doing every day--the important work that our companies are doing to support all of the company's stakeholders. A majority of the American public believes corporations are run solely for profit, for the already rich people who own the shares in the corporation. I'm proud of our work to correct that misimpression. Finally, I'm proud of it because it's sparked something of a debate about the role of the corporation in our society. Some of the debate, I think, mischaracterizes what our statement of corporate purpose is all about, but I'm really glad we're having the debate. I think it's good for our collective corporate governance and it's good for society that we're having this debate.

BL: A year later, have there been any significant or tangible changes in terms of the statement or have you had any updates, any new reflections?

JB: It's interesting that you ask, because it's been such a significant and disruptive year. For most of the time since the statement was released, we've had the pandemic. When the pandemic first hit, I did a...