Creating Value for All Stakeholders
We are delighted to share a passage from Larry Fink's annual letter to the CEOs of companies in which BlackRock invests. We do this with love and pleasure because this text shows great parallels with our own Route ICRpurpose.
With Route ICR, we facilitate online growth for the entrepreneur, team, and company. We do this based on the conviction described by Larry Fink. But what we also do, on top of that, is explain to you in a comprehensible way how to implement this as effectively as possible in practice. It will be obvious that doing so significantly increases the chances of success!
'Purpose and Profit: An Inextricable Link
Last year, I wrote that every company must have a framework to stay on course in this challenging climate. And that this begins with a clear integration of your company's purpose (the intent) into the business model and corporate strategy. Purpose is not just a slogan or a marketing campaign; it is the fundamental reason why the company exists. What it does day in and day out to create value for all stakeholders. Purpose is not just about pursuing profit, but the inspiring force to make a profit.
Profit is not at all inconsistent with purpose. In fact, they are inextricably linked. Profit is essential for a company to be able to act in the interest of all stakeholders over the long term. Not just for shareholders, but also for employees, customers, and the community.
Purpose Aligns Management, Employees, and the Community
At the same time, when a company truly understands and can convey what its purpose is, it operates with the focus and strategic discipline necessary for long-term profitability. Purpose aligns management, employees, and the community. It encourages ethical behavior and erects a significant barrier against actions that go against the interests of stakeholders. Purpose gives direction to culture, provides a framework for consistent decision-making, and ultimately contributes to maintaining long-term returns for your company's shareholders.'
In the Route ICR approach, we don't talk about purpose, but about your company's mission. However, the idea behind the terms is completely aligned.
Source: The letter that Larry Fink (CEO BlackRock) recently sent to CEOs of companies in which BlackRock invests (total assets under management $6.3 trillion). The (original) English version of this letter can be read at BlackRock.com/CEOletter.