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course consider financial performance, but their purpose must also take into con-
sideration the social and environmental impact of their activities. To emphasize
this point, we started our report with a statement attributed to Henry Ford: “The
business has to make a profit, otherwise it will die. But if you try to run a business
solely on profit, then it will also die because it will not have any reason to be.”
But corporations have to define their purpose themselves. Their approach to
social and environmental responsibility cannot be imposed on them. That is the
task of each company’s board. Once they articulate it, they have to share it with
employees, apply it to their business strategies, and also apply it to their day-to-
day actions.
At the same time, some basic protections and principles must be generalized
in the broader political system. We cannot say to a company, “Well, just adopt a
broader purpose on your own.” Many business leaders and investors are striving
to move in that direction already. But they’re legitimately scared about the fact
that they could be punished unfairly if they have to make some major investment
that raises fiduciary concerns, or if they have a soft quarter. They need a legal
framework that protects them.
We also need this legal framework to counter the rules put in place by the
European Commission in 2009, after the financial crisis. Those rules limited the
risks that financial institutions could take, and had an unintended consequence:
They triggered a tremendous shrinking of investment [by responsible financial
institutions] in shares of responsible companies in Europe. And guess who re-
placed them? Less responsible investors. We have to change this. You have to en-
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