Grow the Pie: How Great Companies Deliver Both Purpose and Profit
Cambridge University Press, 3/26/2020
EAN 9781108494854, ISBN10: 1108494854
Hardcover, 382 pages, 22.9 x 15.9 x 2.5 cm
Language: English
A Financial Times Book of the Year 2020! What is a responsible business? Common wisdom is that it's one that sacrifices profit for social outcomes. But while it's crucial for companies to serve society, they also have a duty to generate profit for investors - savers, retirees, and pension funds. Based on the highest-quality evidence and real-life examples spanning industries and countries, Alex Edmans shows that it's not an either-or choice - companies can create both profit and social value. The most successful companies don't target profit directly, but are driven by purpose - the desire to serve a societal need and contribute to human betterment. The book explains how to embed purpose into practice so that it's more than just a mission statement, and discusses the critical role of working collaboratively with a company's investors, employees, and customers. Rigorous research also uncovers surprising results on how executive pay, shareholder activism, and share buybacks can be used for the common good.
Introduction
How to read this book
Part I. Why grow the pie? Introducing the idea
1. The pie-growing mentality
a new approach to business that works for both investors and society
2. Growing the pie doesn't aim to maximise profits – but often does
freeing a company to take more investments, ultimately driving its success
3. Growing the pie doesn't mean growing the enterprise
three principles to guide trade-offs and which projects to turn down
4. Does pieconomics work?
data – not wishful thinking – shows that companies can both do good and do well
Part II. What grows the pie? Exploring the evidence
5. Incentives
rewarding long-term value creation while deterring short-term gaming
6. Stewardship
the value of engaged investors that both support and challenge management
7. Repurchases
investing with restraint, releasing resources to create value elsewhere in society
Part III. How to grow the pie? Putting it into practice
8. Enterprises
the power of purpose and how to make it real
9. Investors
turning stewardship from a policy into a practice
10. Citizens
how individuals can act and shape business, rather than be acted upon
Part IV. The bigger picture
11. Growing the pie more widely
win-win thinking at the national and personal levels
Conclusion
Action items
Appendix
Acknowledgements
Endnotes
Index.