- Higher purpose •
- Corporate governance •
- shareholder value •
- personal well-being
This paper reports the findings of a recent survey of 1019 individuals to learn about their commitment to and perceived value from personal and organizational higher purpose, and examines the implications of the findings for corporate governance and the stated corporate goal of shareholder value maximization.
We found that personal higher purpose promotes personal well-being, including greater happiness and lower stress from COVID-19, and this effect was stronger when the purpose statement was written down. This notwithstanding, while many individuals stated that they have a personal higher purpose, very few had a written statement of purpose. The incidence of written higher purpose statements is higher among organizations than among individuals. Employees of organizations with higher purpose statements were happier and prouder of their organizations. Two of the findings have potentially important implications for corporate governance: (i) The effects we documented were stronger when the purpose statement was written down and tied to society, employees, and customers, rather than shareholders; and (ii) employees trusted their leaders to make better business decisions when they endorsed the social value of the corporate higher purpose.