The world’s business leaders are increasingly embracing a new form of capitalism, moving from one focused primarily on shareholder value to one focused on serving the broader world, said Deloitte recently.
According to the firm’s third annual Readiness Report titled “The Fourth Industrial Revolution: At the intersection of readiness and responsibility,” based on a survey of more than 2,000 C-suite executives, businesses are striving to find a balance between purpose and profit
Nearly six in 10 executives said increasing their companies’ positive impact on society was among their top-five desired outcomes for Industry 4.0, said Deloitte.
By comparison, two years ago, just 35%of CXOs believed that the leading organizations of the future needed to spend more time preparing for how new solutions will impact society, the firm added.
Executives’ growing attention to purpose may largely be attributed to increased pressure from internal and external stakeholders, Deloitte observed.
After “generate revenue,” the top two reasons executives claim they focus on societal issues are “external stakeholders’ priority” (40%) and “employee pressure” (20%).
“We’re seeing a significant shift in executive outlook as they accept the realities of Industry 4.0,” said Punit Renjen, Deloitte Global CEO. “We’re in a new era where shifting societal attitudes have made it an imperative for businesses to place societal responsibility at the heart of their strategies. Business readiness now demands leaders understand this expanded responsibility and deliver solutions not just for business growth, but also for societal progression.”
As companies face these new realities, leaders are re-evaluating their approaches to four key areas critical to Industry 4.0: strategy, societal impact, talent, and technology, Deloitte noted.
Climate change concerns
Almost 90% agreed the impacts of climate change will negatively affect their organisations and 59% claimed to have internal sustainability initiatives in place—from reducing travel to eliminating plastics, and more, according to the report.
In addition, 48% believe tackling climate change is a top responsibility for the current generation of leaders, while 54% said they are focused on and/or have external societal programs in place to address it.
Two years ago, only 10% of executives believed their companies could influence environmental sustainability to a significant degree, Deloitte pointed out.
Executives double down on training and development
Preparing workers to meet the demands of Industry 4.0 continues to be a fundamental business challenge, and leaders lack confidence in how their organisations are faring, said Deloitte.
Only 10% of executives said they have made a great deal of progress in understanding what skills will be needed in the future, and only one-fifth completely agreed their organizations are ready.
In response, executives are focusing energy and resources on training talent, and they increasingly consider workforce development their responsibility, Deloitte said.
Two years ago, only 12% of respondents said their organizations could influence education, training, and lifelong learning for their employees to a significant degree, the firm pointed out.
Now, three-quarters of leaders said training and employee development are the Industry 4.0 priorities in which they will be investing most.