Saving the world one project at a time
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The document discusses the challenges faced by officeholders in balancing shareholders' financial interests with philanthropic efforts. It highlights the rise of B Corporations, which aim to benefit all stakeholders, and emphasizes the need for innovative portfolio management that incorporates social responsibility and environmental sustainability alongside profitability. Additionally, it outlines the impacts of organizational changes on customers, employees, communities, government effectiveness, and the natural environment.
Saving the world one project at a time
- 1. Saving the world one project at a time October 2017 www.pwc.com.au Bryan Fenech Business Transformation Consultant
- 2. Legal limits on officeholders to pursue philanthropic ends Duty to put the financial interests of shareholders first
- 3. Practical limits on officeholders to pursue philanthropic ends Creditor and investor expectations and power “The shareholders will revolt. Being a listed company is another difficulty …if you’ve got massive shareholders, you know, some of the banks or superannuation funds or pension funds …you’re a new CEO and you want to make changes and they don’t get it, they’ll take their money, all your shareholders get pissed off and you’re out of your job.” “In the world’s business model today that’s a major thing for any chief executive, you get up in the morning saying you want to change the organisation you probably won’t have a job in a couple of weeks … you’re not going to deviate from my risk versus return thanks very much.”
- 4. Competing for priority with financial objectives Social responsibility and environmental sustainability running a poor second
- 5. The B corporation movement – a new kind of organisation Benefitting all stakeholders not just shareholders
- 6. Responses from traditional corporations Declarations of values, funding social programs, participating in hackathons
- 8. How portfolio management and assurance can help Measuring value in a more flexible, nuanced and multifaceted way 1. Segmentation 2. Multi-attribute scoring models 3. Balancing 4. Assurance
- 9. Portfolio segmentation Budgeting for different strategic drivers as distinct investment categories Categories can be defined to represent an intelligent balance between profitability and other objectives
- 10. Multi-attribute scoring models Building objectives into prioritisation systems Parameters can be defined that reflect corporate social responsibility and environmental sustainability objectives alongside profitability objectives
- 11. Portfolio balancing Adjust and improve the portfolio over time Opportunities to adjust and improve the portfolio and for an organisation to assess it role as a responsible corporate citizen
- 12. Using program assurance to drive philanthropic objectives Assuring commitments through independent checks Customer Employee Community Political Environmental How does change positively or negatively impact customers? Customers are consumers of products and services and may include people, businesses and government agencies. Impact in this context is specific to this consumption relationship. How does change positively or negatively impact employees? Employers and employees may have different mutual rights and obligations depending on the nature of the employment contract - eg, contractors versus full time employees, part time employees, casuals, etc. Impact in this context is specific to the scope of the employment relationship How does change positively or negatively impact the broader community? Community includes individuals and groups who are third parties in the sense that there is no contractual relationship involved. Impact in this context relates to the interests of citizens and their rights to the enjoyment of public and private space, amenities and services beyond any customer or employment relationship How does change positively or negatively impact the functioning and effectiveness of democratic government? Impact in this context relates to the ability of government institutions to act in the public interest. How does change positively or negatively impact the natural environment? Impact in this context relates to activity that causes pollution of any aspect of the natural environment including land pollution, water pollution, air pollution, thermal pollution, light pollution and noise pollution.
- 13. Questions ... © 2017 PricewaterhouseCoopers. All rights reserved. PwC refers to the Australian member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. Liability limited by a scheme approved under Professional Standards Legislation