In the last few months, the world has seen: new tariffs and trade wars; announcements from presidents attempting to dictate how other countries govern themselves and their companies; yet another CEO resigning due to inappropriate behaviour; companies grappling with the new Corporate Sustainability Reporting Directive (CSRD) requirements; and, all the while, AI has likely quadrupled in capability in the past fortnight alone.

These rapid and profound shifts are challenging long-held assumptions and beliefs about what a business needs to be in today’s world, generating significant debate. But if we zoom out, it’s clear that the purpose-led business movement has progressed considerably over the past decade.

The role of business in society is now a mainstream topic. The impact that businesses have on our lives, the environment, society, and our collective future is almost universally recognised as worthy of board-level and executive team consideration – not least because it has become a subject of growing interest to employees, customers, investors, regulators, policy-makers and other critical stakeholders.

In many sectors, some of the core principles of the purpose-driven movement have become table stakes – the minimum required for a viable and sustainable business that can navigate complexity, adapt to volatility, and build trusted relationships crucial to long-term resilience.

There is a growing acknowledgement that businesses merely meeting the legal minimum may not be enough. Businesses must also demonstrate genuine care for all those affected by their operations, as well as for the natural environment. Those who only comply with regulations may struggle to adapt in an increasingly fast-paced and uncertain world.

Ebbs and flows

Despite significant progress – both in language and action – the purpose-led movement now faces a more challenging environment. There are many reasons for this, but perhaps the two strongest factors are: ongoing economic challenges and the cost-of-living crisis, prompting companies to focus on commercial pressures; and a polarised political context, which brings legal and financial uncertainty.

Many politicians and commentators have adopted a more overtly critical stance towards businesses that aim to deliver social value alongside financial returns. In response, some companies have shifted their positioning, at least in the language they use to describe their work, even if the substance remains unchanged.

Progress is not linear. Those in the purpose-driven space have long discussed the natural “ebb and flow” inherent in this journey. Sometimes it feels possible to make great strides; at others, attention shifts to subtler ways of maintaining momentum.

However, even before recent setbacks – particularly around environmental targets and diversity, equity and inclusion commitments – it was clear that a “do less harm” approach by large organisations lacked the scale, speed and ambition needed to fully harness the power of business in solving our biggest societal and environmental challenges.

Those striving to make a positive impact know this work is difficult, complex, and long-term. It creates a great deal of value for individuals, businesses and society, much of which cannot be measured financially or predicted within standard timeframes. Trying to operate within a system that values metrics, short timelines, predictability and simplicity is hard. Resistance and inertia are commonplace – all this amid the noise: political posturing, shifts in corporate messaging, and policy reversals by some firms, while others double down on their commitments.

Confronting the trade-offs

Purpose-washing is, rightly, being called out. But perhaps it’s a symptom of overselling the “win-win” narrative of purpose-led business, while ignoring the very real trade-offs that purpose alone cannot resolve.

The enthusiasm to create positive change may have led some companies to overreach – involving themselves in issues irrelevant to their core business and distracting from areas where they could have made more meaningful contributions. This diverted attention from what matters most: authenticity and transparency.

Perhaps too much energy has been spent perfecting the words used to describe purpose, and too little on ensuring those words drive meaningful change – change that matters to real people. As we listen to the ongoing debate, we must be curious about what’s really being said, what underlying needs are emerging, and how we can respond in ways that ensure everyone – even the movement’s most vocal critics – feels heard and included.

The opportunity that arises

We see this as a moment of opportunity for the purpose-led business movement. The fundamentals remain strong – and are strengthening. People want to trust that business is building a better future for us all, especially as AI and other technologies rapidly reshape our world.

Employees want to feel that their work contributes to a better world, that they are respected, growing, and developing within organisations that share their values.

Long-term investors are beginning to appreciate that purpose contributes to resilience and longevity in an unpredictable, disruptive world.

And policy-makers, regulators and governments are increasingly recognising the critical role businesses can play in solving pressing societal challenges – delivering value not only financially, but also across human, social, intellectual and natural capital.