Why Profit Shouldn’t be Your Top Goal - a Commentary
This article says that profit should not be the top priority of the business. Infact every business aims at earning more and more profit but stakeholders are much more important. Companies must consider the stakeholders when they make mission statement. A failure to recognize and include essential stakeholders in the mission statement may be costly in the long run, particularly when competitors are better able to address these stakeholders (Nimwegen et al., 2008). For the social economist the goal of the economy is not private profit nor is it improvement in the fertility of the soil nor capital accumulation for their own sakes and that of their owners, but the material, moral and spiritual well-being of homo sapiens (Brien, 1984). Sustainability is the central part of the corporate strategy and companies manage it proactively (Kolk and Pinkse, 2007). This study shows that CEO’s who put stakeholders’ interests ahead of profit generate greater workforce engagement and thus deliver the superior financial results that they have made a secondary goal (Washburn, 2009).
Brien, J.C.O. (1984), “Social values, social goals & manpower”, International Journal of Sociology and Social Policy”, Vol. 4 Issue.1, pp. 49-62, ISSN: 0144-333X
Kolk, A. and Pinkse, J. (2007), “Towards strategic stakeholder management? Integrating perspectives on sustainability challenges such as corporate responses to climate change”, Corporate Governance, Vol. 7 Issue. 4, pp. 370-378, ISSN: 1472-0701
Nimwegen, G.V., Bollen, L., Hassink, H., and Thijssens, T. (2008), “A stakeholder perspective on mission statements: an international empirical study”, International Journal of Organizational Analysis, Vol. 16 issue 1/2, pp. 61-82, ISSN: 1934-8835
Washburn, N.T. (2009), “Why profit shouldn’t be your top goal”, Harvard Business Review, Vol. 87 Issue 12, pp. 23-23, (AN 45359642