- The public largely distrusts corporate America despite large companies doing more work than ever before to try and serve stakeholders outside of their investors, according to KPMG CEO Lynne Doughtie.
- The problem is that CEOs are failing to adequately tout that work, she told Business Insider at the World Economic Forum’s annual conference in Davos, Switzerland.
- The professional services giant is developing something akin to an “accountability tracker” that can help firms better track social impact.
- This article is part of Business Insider’s Better Capitalism series, which tracks the ways companies and individuals are rethinking the economy and role of business in society.
- Visit Business Insider’s homepage for more stories.
DAVOS, Switzerland – The public has a wide distrust of many of the core institutions in the US, including the media, the federal government, and corporate America.
Professional-services giant KPMG is trying to change that – and it’s working alongside other Big Four firms to develop something akin to an “accountability tracker” that can help companies measure their social impact to then tout publicly.
“We’ve started the journey, and I think it’s going to continue to grow in a big way,” CEO Lynne Doughtie told Business Insider at the World Economic Forum’s annual conference this week in Davos, Switzerland. “It will help close the expectation gap when organizations can prove that not only do they care about this, but they’re doing things to drive a better impact.”
KPMG, for example, is helping a major private equity firm track the impact of a fund focused on companies trying to promote social good. The CEO did make it clear that the tracker is still very much a work in progress. Though it’s in the early stages, she added that it’s the kind of project that will become essential to companies worldwide.
“I think we’re all working hard to see how it evolves,” she said. “I don’t know where it’s all going to go, but I don’t think it’s going away.”
Alongside developing metrics to track corporate efforts, Doughtie is using her perch on the Business Roundtable – an influential advocacy group that includes other top CEOs like IBM’s Ginni Rometty – to push companies to consider stakeholders outside of investors.
But Doughtie also said that the public perception doesn’t match the reality of what corporate America is doing. And one key reason is because top CEOs need to do a better job informing and educating the public of the initiatives underway.
“There’s never been a time where companies have been doing more in that regard,” she said. “I’ve never seen business leaders be more engaged in wanting to do good, while at the same time obviously driving their business growth and profitability.”
It’s a skill set top executives are increasingly needing to hone. Alongside the typical investor communications, pressure is building on CEOs to take an active voice on hot-button, politically divisive issues like immigration and LGBTQ rights.
While several top business leaders have become more vocal on topics that run counter to their company’s values, it can be a difficult path to navigate, as most executives are hesitant to alienate specific groups – or even their own employees who are also looking for them to speak out, according to Doughtie.
“I have to be careful because I want KPMG to be full of people who have diverse perspectives,” she said. “But when you get to a point where there’s something that goes against your stated values, then it can be important to speak out against it.”
As the head of one of the world’s largest professional-services organizations, Doughtie is uniquely qualified to lead, given her opportunity to interact with CEOs and other executives from prominent global businesses. While she said KPMG is excellent at helping companies carry out actions like predict quarterly earnings, more work needs to be done on metrics to help evaluate the social good they do.
The firm has an opportunity to help “organizations design the measurements around their social impact. And it’s hard. It’s harder,” she said. “There is quite a bit of work happening in that space, but obviously much more” is needed.