Perhaps surprisingly, Facebook tops the list when it comes to purpose-driven leadership.
Good morning.
We’ve covered many CEOs in this space who believe putting purpose at the center of their business drives results. (For a summary, look here.) But how do you distinguish true purpose, which animates the strategy and operations of a company, from “purpose washing”—an aspirational statement that gets posted on a website, but never imprinted in the hearts and minds of employees?
This year, Fortune teamed up with Indiggo in an attempt to get a data-driven answer to that question. The Indiggo team queried a wide array of publicly available data from the top 100 companies on the Fortune 500 list to find answers to 17 key questions that determine a company’s connection to its purpose, its strategic clarity around that purpose, the alignment of leaders around the purpose, and focused actions to support the purpose. The methodology is complex, and I can’t do it justice in 300 words, but you can read more here.
The upshot is an interesting list—the ROL 100 (Return-on-Leadership) —with a surprising company at the top: Facebook. The social media has been under relentless criticism recently for its role in both disseminating and blocking provocative posts. But when it comes to purpose-driven leadership, the Indiggo methodology places it at the top. Surprised me.
Others in the top five:
2) Goldman Sachs
3) Microsoft
4) Johnson & Johnson
5) HP
You can find the full list of 20 here. One interesting finding of the research is that the top 25 companies on the list had three times the total shareholder return, five times the EBIDTA per employee, and seven times the revenue growth of the bottom 25. So purpose and profit seem to go hand in hand. You can find more about the list in Lance Lambert’s piece for Fortune Analytics here, and dive deeper into the methodology on the Indiggo web site here. Let us know what you think of the approach.
And for other Fortune coverage of the new Fortune 500 list, please be sure to read Michal Lev-Ram’s delightful piece on the irrepressible Marc Benioff; Katherine Dunn’s story on the greening of Exxon Mobil; Phil Wahba’s look at Tractor Supply’s surprising pandemic success; and Shawn Tully’s story on how Lennar is capitalizing on the new home-buying craze.
Up next week: the Fortune Global Forum, which is being held virtually with a roster of CEOs that include Michael Wirth of Chevron, Carlos Brito of AB InBev, Chuck Robbins of Cisco, Julie Sweet of Accenture, Adena Friedman of Nasdaq, Tricia Griffith of Progressive, Judy Marks of Otis, Mark Hoplamazian of Hyatt, Makoto Uchida of Nissan, Kevin Johnson of Starbucks, Jane Sun of Trip.com, Michael Saylor of MicroStrategy, Brian Chesky of Airbnb, Kevin Aluwi of Gojek, Jessica Tan of Ping An, Natarajan Chandrasekaran of Tata, Ana Botín of Santander, David Taylor of P&G, Geraldine Matchett of DSM, Dirk Van de Put of Mondelēz, Brian Niccol of Chipotle, Michelle Gass of Kohl’s, Corie Barry of Best Buy, Kathy Warden of Northrop Grumman, Arvind Krishna of IBM, Uğur Şahin and Özlem Türeci of BioNTech, and many more. For more information, go here.
News below.
Alan Murray
@alansmurray
alan.murray@fortune.com
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Universal SPAC
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Android privacy
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Facebook antitrust
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Musk, Bitcoin
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Biden's list
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EU's list
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Sinopharm doubts
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Stock market
Meet Jerry and his son Aiden, two characters in this fantastic Joshua Brown piece for Fortune. Jerry is an old-school investor, while Aiden is one of those newfangled, app-toting investors whose meme-stonk approach is roiling his dad's retirement portfolio. Aiden only knows a stock market that heads north. That may soon change, but the stock market that Jerry knows may be gone forever. Fortune
This edition of CEO Daily was edited by David Meyer.
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