Source | sloanreview-mit-edu.cdn.ampproject.org | Ashley Bittner | Brigette Lau
Companies that take a human-centered approach to their missions see the benefits of committed and engaged employees and customers
The economic fallout of COVID-19 and other societal events of the past year have exacerbated and shed light on severe inequities across the U.S. workforce. About half of Americans have little to no savings, and millions have faced financial devastation as unemployment and hunger rates have spiked throughout the crisis. Minority workers have been disproportionately affected by what is being called the most “unequal recession in modern U.S. history.”
Yet, despite the economic downturn, the stock market has soared. It’s clear that there is a profound disconnect here; the measurements used to gauge a corporation’s financial health largely ignore the people who keep that corporation afloat. In short, today’s business environment is not human-centric.
In a sense, 2020 served as the ultimate test of a promise made by Business Roundtable CEOs in August 2019. In the widely publicized announcement, the chief executives of many of the world’s largest companies emphasized the need to move away from shareholder supremacy. The purpose of a corporation, they vowed, would now be to serve all stakeholders, including employees, customers, and communities. But in September 2020 — after months of pandemic-induced shutdowns and protests for racial justice — a study found that corporations were failing to fulfill this promise of stakeholder capitalism.