By: Michelle Bhattacharyya
"The American dream is alive, but fraying". On August 19, 2019 Chairman and CEO of JPMorgan Chase & Co. and Chairman of Business Roundtable stated what many Americans already understand. It is increasingly difficult for U.S. workers to achieve economic mobility. But rather than being a harbinger of trouble, this statement is a beacon of hope. U.S. companies are beginning to understand that providing opportunity for workers and supporting communities is a fundamental tenant of how a business must operate to achieve long-term success.
Business Roundtable, a group of 181 CEOs that has issued principles on corporate governance since 1978, has finally changed tune on upholding shareholder primacy as the principle corporate purpose. For the first time since its formation, the group stated that the purpose of a corporation is to serve all of its stakeholders. Nearly 200 CEO's have committed to a corporate purpose that:
- delivers value to customers;
- invests in employees;
- deals fairly and ethically with suppliers; and
- supports the communities in which they work
That's great news for Americans. The question that follows such a grand statement is how do these CEOs put tooth to this commitment? Living Wage On-Up has been developing a solution since August 2018 that adapts the UK Living Wage Foundation model of living wage accreditation to the U.S. context and provides every American with the ability to hold companies accountable and incentivize good behavior with their consumer dollars.
We've begun by engaging companies, unions, community groups, academia, and workers in a conversation that explores both the business impacts of voluntary living wage payment, and the changes that it makes in the lives of workers and their communities. We are swiftly progressing toward launching a nationwide living wage certification and member community that will pursue a shared standard, agreed by all stakeholder groups, on what it means to pay a living wage based on the wide-ranging costs of living across the U.S.
This work is the beginning of creating transparency on the single issue of living wage payment. It simplifies an understanding of the impacts to workers, communities, and companies of paying a living wage to all workers, and creates a path that will remove barriers and reward a growing number of American companies that deliver on Business Roundtable's newly stated purpose for American corporations.