From Shareholder to Stakeholder

Denis Pombriant
6 min readJan 12, 2021

Corporations are recognizing new duties in areas that are not strictly related to their financials. Succeeding in these non-financial pursuits requires the same efforts and the same kind of accountability as in formal finance though.

It is an old truism that continues to be invoked because of its wisdom: you can’t manage what you don’t measure. We need to measure because we need to manage and the number of things we need to manage is only increasing. Where businesses were once content with reporting on financial issues for a long time, a new trend in non-financial reporting is just beginning.

The Business Roundtable’s declaration of corporate purpose has changed the landscape.

Perhaps the biggest milestone came in 2019 when the Business Roundtable, a group of big company CEOs that tries to guide the imperatives of global business and economics, said that the era of shareholder capitalism was giving way to stakeholder capitalism. Stakeholder seems an odd construction, even somewhat foreign, and the concept of replacing the shareholder at the center of finance and economics seems odder still. But stakeholder capitalism doesn’t seek to upend the shareholder, it simply seeks to acknowledge others as co-equals.

The Business Roundtable’s idea of stakeholders includes shareholders but also acknowledges employees, customers, partners and local communities. Going back to the idea of measurement and management, stakeholder capitalism suggests a new need to manage, and therefore measure, a corporation’s involvement in each sphere.

CRM As An Example

For decades corporations have tried to understand customers through various software applications that fall under the umbrella of CRM or Customer Relationship Management and for good reason. Measurably happy customers tend to buy more and stay with a vendor longer than their less happy peers. In CRM we’ve developed an array of management tools and techniques to measure and thus manage our customer outreach.

For example, what’s your business’ attrition rate? In the late 20th century, many businesses had no way of knowing and too often relied on keeping prices low to keep people coming back. That strategy left less room in corporate budgets for things like customer service which was often the second thing to be cut in economic tough times, the first being marketing. But customer…



Denis Pombriant

Researcher, author of multiple books including “The Age of Sustainability” about solutions for climate change. Technology, business, economics.