So it is almost the end of the summer holidays, and I hope that many of you took the time to turn off your work notifications and actually have a break. The world keeps spinning (just), when we are not connected. Honest.
But while the post-holiday blues may be threatening to hit, just like a recession, I believe there are some (perhaps not several, but some) reasons to be cheerful as you get back into the business of real estate.
My Monday morning was certainly brightened when I read that Business Roundtable, a collection of chief executives of some of the biggest corporations in the US, had redefined its corporate governance principles away from being entirely focused on delivering for shareholders and more towards delivering for all stakeholders. That means customers, employees, suppliers, communities and shareholders.
Business Roundtable has been issuing principles of corporate governance since 1978, and since 1997 each version of that document has endorsed principles of shareholder primacy – i.e that corporations exist principally to serve shareholders.
But this week, 181 big business leaders said that was no longer the purpose of business. This week, 181 US-based corporations, including from our little world the likes of Aecom, American Tower, BlackRock, CBRE, Carlyle Group, Lennar Corporation and Tishman Speyer, committed to:
- Delivering value to customers by leading the way in meeting or exceeding customer expectations;
- Investing in their employees by compensating them fairly and providing important benefits, supporting them through training and education that help develop new skills, and fostering diversity and inclusion, dignity and respect;
- Dealing fairly and ethically with suppliers;
- Supporting the communities in which they work by respecting the people in those communities, and protecting the environment by embracing sustainable practices across their businesses;
- Generating long-term value for shareholders.
There are a few quotes in the Business Roundtable announcement that I want to share with you all, as it is these quotes, the above pledges and the fact that big businesses from our sector have committed to them which leaves me with the feeling that there may be some pretty decent reasons to be cheerful about the future (B-words aside: Brexit and Boris).
“Major employers are investing in their workers and communities because they know it is the only way to be successful over the long-term.” Jamie Dimon, chairman and chief executive, JPMorgan Chase & Co.
“It affirms the essential role corporations can play in improving our society when chief executives are truly committed to meeting the needs of all stakeholders.” Alex Gorsky, chairman and chief executive, Johnson & Johnson.
“Chief executives work to generate profits and return value to shareholders, but the best-run companies do more. They put the customer first and invest in their employees and communities. In the end, it’s the most promising way to build long-term value.” Tricia Griffith, president and chief executive, Progressive Corporation – the biggest provider of car insurance in the US.
Add to those 181 US corporates the more than 350 investors – including the Church Commissioners, Aviva Investors, Legal & General and Hermes – that make up the Climate Action 100+ group, and we have something akin to an institutional movement. A shift in mindset among big business that profit and a purpose that works and means something for all might actually be possible.
We’ve all had the summer to consider the results of both the British Property Federation’s perceptions study and Grosvenor’s trust survey. The time is now to start taking action. To pledge – as a whole industry – to commitments such as those by the Business Roundtable and Climate Action 100+. To commit, to act and to lead.
- No-one is perfect, and last week in our coverage of Canary Wharf Group’s new chief executive we accidentally said CWG had a 1m sq ft development pipeline, instead of 11m sq ft. Apologies to CWG for us being under-ambitious with our numbers.