This week marked a milestone for business. The Business Roundtable, an association of nearly 200 American CEOs, issued its “Statement on the Purpose of a Corporation,” a pledge to deliver value not just to shareholders, but to all stakeholders — and in doing so, to fundamentally shift the role of business in the world.

This isn’t some small-ball, better business initiative. It’s the chiefs of JPMorgan Chase, Johnson & Johnson, IBM, General Motors and many more creating a new blueprint for the future of capitalism. It’s a collective rejection of one model — Milton Friedman’s declaration of profit as the only responsibility of business — and the embrace of another. As Jamie Dimon, the Roundtable’s chairman, put it, “The American Dream is alive, but fraying. Major employers are investing in their workers and communities because they know it is the only way to be successful over the long-term.”

This new model gives us a glimpse of a future where businesses can be the greatest platform for social change — while still continuing to grow, innovate and compete. It includes:

  • Delivering value to our customers.
  • Investing in our employees.
  • Dealing fairly and ethically with our suppliers.
  • Supporting the communities in which we work.
  • Generating long-term value for shareholders.

It’s the culmination of a movement that has been gaining steam for some time. In 2013, Richard Branson launched The B Team with the mission to change the values that drive businesses and to move beyond the obsession with quarterly earnings and short-term growth. I’ve learned a lot by being on the B Team’s board since the beginning, and by joining the board of JUST Capital, which Paul Tudor Jones founded to build a more just marketplace that reflects people’s true priorities.

And now, at a time of wavering trust in capitalism, when 64 percent of Americans say a company’s primary purpose should include “making the world better,” our leaders have understood the need to act. JUST Capital reports that “over the last five years our polling has showed that regardless of age, political affiliation, income, ethnicity, or gender, people want companies to stop prioritizing shareholders and start sharing success with all stakeholders.” The Roundtable’s commitment is the culmination of Alan Murray’s observation that “in the past few years, it has become clear that something fundamental and profound has changed in the way CEOs approach their jobs.”

For far too long, we’ve operated on the belief that businesses must single-mindedly pursue profit, consequences be damned. We’ve watched as this approach has left individuals and communities behind, turned a blind eye to unfair and unethical practices, harmed the planet and created a global epidemic of stress and burnout.

This week’s news puts us on a new and better path. It acknowledges the reality that profit and purpose are not in opposition, but rise together. The CEOs have spoken. Now, it’s on them to turn those words into action.

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Author(s)

  • Arianna Huffington

    Founder & CEO of Thrive

    Arianna Huffington is the founder and CEO of Thrive, the founder of The Huffington Post, and the author of 15 books, including Thrive and The Sleep Revolution. In 2016, she launched Thrive, a leading behavior change tech company with the mission of changing the way we work and live by ending the collective delusion that burnout is the price we must pay for success. She has been named to Time Magazine’s list of the world’s 100 most influential people and the Forbes Most Powerful Women list. Originally from Greece, she moved to England when she was 16 and graduated from Cambridge University with an M.A. in economics. At 21, she became president of the famed debating society, the Cambridge Union. She serves on numerous boards, including Onex and The B Team. Her last two books, Thrive: The Third Metric to Redefining Success and Creating a Life of Well-Being, Wisdom, and Wonder and The Sleep Revolution: Transforming Your Life, One Night At A Time, both became instant international bestsellers. Most recently, she wrote the foreword to Thrive's first book, Your Time to Thrive: End Burnout, Increase Well-being, and Unlock Your Full Potential with the New Science of Microsteps.