Test

The purpose
of companies

1

A broad vision of the company

Why do we exist? What are we good for? What use do we make to society?

2

Between historical identity and strategic project.

The purpose is part of the company's identity and strategy.

3

An imperative in an increasingly volatile world

The success of any strategic project depends on its ability to project itself into the future around a unified company.

4

Making it operational

Purpose only has meaning and impact if it becomes operational and transformative for organizations.

What is corporate purpose? First appearing in France in the Notat-Senard Report, the expression purpose d'entreprise officially entered positive law in May 2019 through the PACTE law.

Neither a slogan nor a marketing signature, the notion of purpose encourages companies to formulate the meaning of their project and their usefulness to society. The purpose can be incorporated into the company's articles of association to give it concrete reality and legal effectiveness.

At a first level, purpose can be defined as the expression of the company's usefulness to society, i.e. the simplest and most profound answer to the question why? Why does the company exist? What purpose does it serve for its stakeholders (employees, talents, consumers, shareholders, partners, etc.), but also for society in general?

Direction

By giving themselves a purpose, companies establish the profound meaning of the common project of all those who bring them to life. They lay the foundations for their collective utility, which is different from their corporate purpose.

Difference

A company's purpose is a means of differentiating itself from its competitors, attracting and retaining talent as well as consumers.

Decision

The purpose acts as a compass and filter for the company's major decisions. It enables the company to set a long-term strategic course for all its stakeholders.

The purpose of companies: a broad vision of the enterprise.

For a company or organization, defining a purpose means answering these essential questions: Why do we exist? What are we good for? What purpose do we serve in society?

In other words, it means reaffirming its usefulness to all its stakeholders.

Climate change, new consumer habits, a proliferation of regulations, the expectations of society and new generations... the world of business is no longer the same, and it's changing faster and faster. Today, consumers, residents, employees, local authorities and associations all expect companies to get involved in major social issues and explain the specific role they intend to play in them. This is an opportunity for companies to give meaning back to their collective.

Stakeholders include not only employees, but also all those who participate, directly or indirectly, in the life of the company: customers/consumers, local residents, suppliers, local authorities, associations, partners, etc...

The more proof companies can provide of their commitments, their environmental, social and economic objectives, and their concrete actions in favour of their ecosystem, the greater the impact. But as in environmental matters (green-washing), beware of purpose-washing, which discredits companies!

The purpose of companies:
between historical identity and strategic project.

A company's purpose is part of its identity and strategy. It differs from CSR in that it does not separate the challenge of economic performance from that of social and environmental contribution.

On the contrary, it combines them in a single ambition, with one underpinning the other, and vice versa. A company's purpose thus expresses both its economic vocation (value creation) and its social vocation (positive impact) in the same formula, linking them irrevocably.

Reconnect people
to Nature

By way of illustration, when Groupe Rocher chooses "Reconnect people to nature" as its purpose, this enables it both to underpin its business project focused on plant-based cosmetics and at the same time to affirm its commitment to the experience of nature for the dual benefit of people's health and that of the planet.

The keys to a responsible digital world

In the same way, when Orange proposes to give everyone "the keys to a responsible digital world", the Group is positioning itself in its core businesses and at the same time claiming a horizon to share with its stakeholders that is at odds with the major global players in the digital sector.

The purpose of companies,
an imperative in an increasingly tense world
.

In the great history of globalization, of which the planetary pandemic of COVID-19 was the latest episode, the success of any strategic project depends on its ability to project itself into the future around a company that is unified (its activities, territories and teams), exemplary (its commitments), integrated (the complementary nature of its businesses) and sustainable (its ability to innovate and develop new models).

Faced with a more complex, interconnected and fragile world, defining a company's purpose and reflecting on its operational implementation within the company is a necessary counterpart to the strategic exercise, in order to meet the challenges:

  • business development by redefining business models and their sustainable future
  • internal cohesion around a
    dynamic of meaning and unified commitment
  • outreach teams in the regions and to your stakeholders.

To achieve this, we need to take into account the company's history, the structure of its reference shareholders and the organization of its business lines, in order to provide a unique response, specific to each company, to the question of reconciling the social interest (that of the company) and the general interest. This approach also represents a particularly strategic challenge for the company's development. Particularly at a time of uncertainty, questioning and new expectations on the part of customers, consumers and society at large.

This is all the more true for companies whose activities involve new challenges, whether related to the protection of natural environments, global warming, local social contribution or other issues.

These are all subjects of debate, polarization and commitment on which the company will be expected to act by its stakeholders, whether they be tomorrow's talents to recruit or future customers to win over.

Through this process of defining a statutory purpose and its implementation by its business units, the companies are demonstrating their commitment to contributing to the collective success of the regions in which they operate:

This voluntarism often proves to be a long-term winner for companies that know how to make it a cornerstone of their strategy, like the American company Patagonia, a pioneer in this field in the warehouse sportswear sector.

Corporate purpose :
getting it up and running

Purpose only has meaning and impact if it becomes operational and transformative for organizations.

Without operational application, the purpose is a stylistic exercise that will quickly become counterproductive both internally and externally. Without getting teams on board, the purpose is a management dashboard that won't create a transformation dynamic.

General management and operational management must become players in the implementation of the purpose by :

  • Defining the roles of everyone involved - governance, management and business units - in implementing the company's purpose.
  • Translating the purpose into a plan of objectives and concrete actions at each level of responsibility
  • Ensuring its long-term managerial execution.
  • Measuring its impact with new monitoring indicators and KPIs.

Examples of reasons to be

The Rocher Group's purpose: "Reconnect People to Nature.

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Keolis' purpose: "Imagining and deploying safe, sustainable mobility".

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Orange's purpose: "The keys to a responsible digital world".

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