One of the more curious phenomena of the West’s meaning crisis has been the turn of CEOs and business school professors towards the use of explicitly theological language. The Financial Times and World Economic Forum are full of talk of highest principles, generative forces, and even souls. Under the new banner of ‘stakeholder capitalism’ we seem to be witnessing a wholesale re-purposing of capitalism itself. A new acronym “ESG” (standing for Environmental, Social and Governance) is becoming ubiquitous as the mark of this new corporate teleology. What is going on here?

The idea that businesses exist to make returns for their shareholders is becoming dangerously old-fashioned. Capitalist elites are instead insisting on a new orthodoxy, the merger of profit and purpose. In short, this requires that companies have a defining reason for being beyond merely making money. A “North Star” must be identified by each company. This should then pervade the organisational hierarchy and manifest in desirable social and environmental change.

In his recent book Deep Purpose, Harvard Business School professor Ranjay Gulati defines purpose as a “unifying statement of commercial and social problems that a business intends to profitably solve”. ¹ His language is strikingly and unashamedly religious in tone. We are told that businesses need a “soul” alongside a “divine mission”, and that the best CEOs should be capable of “beaming divine revelation”.²

This evangelical zeal should then manifest in the building of “moral communities” with a “religious fervour”.³Gulati explains how a “deep fidelity” can improve employee engagement. ⁴However, this is not limited to mere productivity gains in the workplace. He also suggests that businesses should be in the priestly business of providing the guidance that helps individuals connect their personal purpose with that of the organisation “explicitly inviting them to ‘live’ the organisation’s purpose in their own ways”.⁵

If in any doubt, Gulati reminds us time and again that this is simply obvious business sense. Having a sustainable purpose sits at the “heart and soul of high-performance companies”.⁶ Tap into what consumers supposedly want – socially and environmentally conscious goods and services – and companies can expect to earn a premium.

Could we be witnessing, then, the construction of a new telocentric religion? Larry Fink, head of the world’s biggest asset manager, Blackrock, certainly sounds like St Maximus the Confessor when he writes that placing ESG and purpose at the top of the corporate structure can “unify management, employees and communities” whilst being able to “drive ethical behaviour”.⁷

Fink sees the goals of ESG as part of a universal pattern. His annual Letter to CEOs – with its sermon-like quality – is the template of the new belief structure. When he writes that “the relationship between a company, its employees and society is being redefined”⁸, we implicitly understand that the nature of this re-definition is already determined. His letters confidently make repeated reference to a universal set of ESG “values” that companies must reflect back at their customers.

At the centre of all this is the net-zero target. Fink writes about this as if it were some mighty deity to be appeased by offering up “unprecedented amounts of capital” in sacrifice.⁹This is in pursuit of no less than “the greatest investment opportunity of our lifetime”. Companies which do not meet “sustainability-related disclosures” (tellingly left very ambiguous) will be voted down and funds diverted accordingly.

We therefore see the construction of a new hierarchy of gods and demons. At the top of the hierarchy we see “Environmental” promising the delivery of a net-zero, greener future. On the second level comes “Social” with a particular view of human rights, diversity and inclusion at its core. At the third level, “Governance” addresses organisational ethical standards and board-level diversity.

The underlying logic of Fink’s approach is that if it can be made harder for evil non-ESG investments (e.g., fossil fuels, arms or insufficiently diverse companies) to raise money, they will eventually be made un-investable ventures and driven out of the hierarchy altogether. This Manichean casting-out of undesirable participants is of course a very different argument to the one that claims companies with a “virtuous” purpose supposedly outperform those without.

Yet it is often when the rubber hits the road on ESG that things get trickier for business. Take, for example, the recent history of Unilever, one of the world’s biggest food and consumer products groups. The maker of Ben & Jerrys and Dove Soap puts “purpose” at the heart of its strategy, namely to “make sustainable living commonplace”.¹⁰Its core strategy document describes the company as wanting to win “with brands powered by purpose” with a firm that “stands as a beacon for diversity, inclusion and values-based leadership”.¹¹

Predictable enough, right? Look more closely, however, and one spots a rather big problem: not a single mention of the customers or their needs.

No wonder Unilever was attacked earlier this year by a top shareholder, Terry Smith, for “corporate gobbledegook”. ¹²Smith also suggested Unilever management had “lost the plot” in the pursuit of trying to define the purpose of its mayonnaise brand Hellman’s.¹³In other words, some investors are increasingly seeing Unilever’s “purpose-driven” strategy as a distraction from its core operating responsibility. For the record, Unilever has significantly underperformed its rivals, Nestle and Proctor & Gamble, over the last five years.

The rush to gather and define ESG data upon which companies (and also presumably their “stakeholders”) can be judged is another curiosity. As Robert Armstrong has pointed out in the Financial Times, if purpose were inextricably linked to outsized profits then “profit-seeking investment managers would be doing all the work for us, and we wouldn’t have to be having this damn conversation in the first place”.¹⁴And so, the hunt for additional ESG data points itself suggests business is venturing into genuinely new realms of non-financial activity.

These realms were once those of civic and religious leaders: the political and the moral. Under the ESG flag, business now sees itself as needing to define and bring about the common good at the same time as giving spiritual counsel to employees. Former Blackrock Chief Investment Officer turned ESG sceptic, Tariq Fancy, recounts Johnson & Johnson CEO Alex Gorsky saying that “there were times I felt like Thomas Jefferson” ¹⁵, while there is barely a profile of former Unilever CEO Paul Polman that does not reference the time he nearly become a priest.¹⁶

What does this merger of CEO with priest and president signify? Firstly, we see the strange paradox of the participants of the decayed hierarchy putting themselves forward to fix it. This feels rather like the builders of the Tower of Babel pitching to do the renovation work. Secondly, we should recognise the huge transformational impact that this could have. Corporates are tapping into both the meaning and the environmental crises as sources of growth. They are doing so with a teleological pitch and with trillions of dollars to make its principles manifest.

Traditional religious organisations will be required to make a response. The Church of England, for example, was an early mover and supporter of ESG funds. Archbishop Welby has spoken of the need to reconnect “wealth creation and social justice”.¹⁷Yet on its current path, this also means letting Ben & Jerrys and hundreds of other global brands lead the conversation and deploy huge resources (certainly greater than those of the Church of England!) to shape social norms and even geo-politics.¹⁸.

A similar dilemma will also face the not-for-profit sector. Its very existence was predicated upon the idea that there were some ends that the market could not achieve. If profit and purpose converge, then where does not-for-profit fit in the hierarchy? Were these organisations not historically set aside from the market for good reason?

Private equity firms with billions of dollars in investment capital are incredibly hungry for investments they can describe as ESG. It is surely not far-fetched to see these firms taking stakes in not-for-profits, helping them on their way to the stock market where the public can have a piece of them. Anybody for the IPO of Unicef in 2030?

Perhaps we shouldn’t act too surprised if large corporations have started to see the power of symbolism and purpose. After all, marketing departments have long made use of abstract concepts to create a sense of meaning in their customer’s lives.

So the real dilemma here is where to draw the line. In the West, we have worked under the assumption that markets have moral limits. As Michael Sandel has pointed out, in many situations “monetary exchange spoils the good being bought”.¹⁹If I paid for someone to write an apology to a friend, then the end might be achieved but the chance for inward transformation is lost. This point is being lost in the debate. What then do we stand to lose in a culture which John Gray has described as being “mesmerised” by the market?²⁰

Set within the right limits, Amazon might offer the most impressive study of genuinely effective corporate symbolism. Its purpose of being “the Earth’s most customer-centric company” is deceptively simple and not obviously aligned to any set of social or environmental outcomes.²¹

Such a statement acts as a genuinely compelling North Star for the organisation, which has led to a famously efficient set of routines, habits and employee participation, and thereby to outstanding success.

Capitalism has, of course, often been described as being like a replacement religion.²²However, the difference now is that it seems to be explicitly presenting itself as such. The ESG moment therefore marks a profound paradigm shift.

Even so, we are still relatively early in these conversations around ESG and purpose. It is probable that the tough conversations about the true business and ethical trade-offs have still not been had yet. As the Unilever case shows, there will be many bumps in the road which lead to questions about the underlying assumptions of the new orthodoxy. A worsening economic environment with rising borrowing costs will test how committed investors really are to the new sacred symbols.

This convergence of markets and morality also raises fundamental questions about dissent. In a world where money (and therefore opportunity) is increasingly digitally distributed, what recourse will those have who disagree either with the aims of the new orthodoxy or at the very least the means of getting there? The rush to achieve ESG compliance and funding flows denies the opportunity for a patient ferment of its ideas.

It would be far too easy to cast corporate do-goodery as merely cynical PR. That has not been my intention here. Corporate boardrooms are welcoming the ESG trend as a source of growth and a way of making what they see as a positive impact on the world. Nobody can reasonably deny that we are not in fundamental meaning and environmental crises. To have business not be conscious of its long-term impact on these would itself be damaging.

Yet the theological turn of business marks a significant development. We are seeing the rapid construction of new hierarchies of meaning by a relatively small number of powerful organisations. Paradoxically, in the attempt to curb the excesses of capitalism through purpose, the outcome may be that we end up with an expansion of capitalism, underwritten and emboldened by a new teleology.

This new hierarchy of meaning will stand in opposition to Christ’s admonition that “one cannot serve both God and mammon”. Instead, it will run the experiment to prove the opposite. As this new symbolic story begins to unfold, we should continue to ask ourselves what it means for goodness and justice to have their price.

1. Gulati, Ranjay, Deep Purpose, Harper Collins, February 2022, p.11[↩]
2. Gulati, p.12[↩]
3. Ibid.p.194[↩]
4. Ibid.p.166[↩]
5. Ibid.p. 200[↩]
6. Ibid, front cover[↩]
7. Fink, Larry, Letter to CEOs 2019, Blackrock[↩]
8. Fink, Larry, Letter to CEOs, 2022, Blackrock[↩]
9. Ibid.[↩]
10. taken from Unilever Annual Report 2020, p.8[↩]
11. Ibid. [↩]
12. Smith, Terry, .Unilever + GSK Consumer: A post mortem, January 2022, p.3[↩]
13. taken from Fundsmith’s annual letter to shareholders, January 2022, p.3[↩]
14. Armstrong, R, The ESG Investing Industry is Dangerous, August 24, 2021, Financial Times[↩]
15. Fancy, Tariq, The Secret Diary of a Sustainable Investor Part 2, August 2021, Medium.com[↩]
16. Schumpeter, The parable of St Paul, Sept 2nd, 2017, The Economist[↩]
17. Justin Welby quoted at the Inclusive Capitalism Conference, Huffington Post, December 6 2017[↩]
18. Ben & Jerry’s sent a tweet on February 4th admonishing Joe Biden for fanning the “flames of war” by sending troops to Eastern Europe[↩]
19. Palmer, Tom, Book Reiview: What Money Can’t Buy: The Moral Limits of Markets, September 2012[↩]
20. taken from review of Michael Sandel’s ‘What Money Can’t Buy:The Moral Limits of Markets’, 2012[↩]
21. Amazon’s ‘Our Mission’ statement taken from https://www.aboutamazon.co.uk/uk-investment/our-mission[↩]
22. and Max Weber famously drew the link between Protestantism and a particularly dynamic strain of capitalism[↩]