Nicole Steller of the European Academy of Management, Albena Björck of the ZHAW School of Management and Law, and Guido Möllering of Witten/Herdecke University discuss the topic of the emerging chief executive officer.
Chief executives: Do firms really need them? For decades, the shareholder model has dominated corporate strategy, often eliminating transparent discussions of the organization’s broader purpose. Today, in the world formed AI, economic uncertainty and continuous organizational change, many stakeholders want companies to represent something more than short-term results. As a result, the word ‘purpose’, defined as the reason for a firm’s existence in society, has become a powerful business term, especially following the Business Roundtable’s 2019 statement on business purpose. However, the more companies talk about purpose, the less employees believe in it.
Research suggests that a company’s mission may be “too good to be true.”. Employees are becoming more and more knowledgeable objective rhetoric as vague, superficial and disconnected from the realities of everyday work. Companies make big promises about values and social responsibility, yet the day-to-day is always dominated by growth targets, performance pressures and quarterly results.
Employees see a gap between what organizations say and what they actually do.
The emergence of CPOs and the importance of being ‘purpose driven’
This growing complexity has encouraged a new managerial role that has quietly emerged: the chief mission officer, or CPO.
Ubisoft, Virgin Atlantic, Cisco, Sephora and KPMG, to name a few, have introduced mission-oriented leadership roles in recent years.
Their job is simple in theory but difficult in practice: to ensure that the stated purpose of the company has an impact on actual decisions. Rather than competing with financial goals, CPOs help define how purpose and performance can be reconciled, especially when leaders face difficult trade-offs around growth, stakeholders and long-term responsibility.
Ours recent survey of 44 chief executives across industries such as sports, tourism and beauty they find that these managers work at the intersection of strategy, culture and ethics to transform their organizations into purpose-driven organizations.
They help connect higher purpose statements with the reality of organizational life.
In practice, this means asking tough questions during leadership meetings:
- Is the business decision consistent with the company’s long-term direction and purpose?
- When does growth undermine an organization’s mission?
- How does a company create social value? And when its operations are causing damage, what changes are needed to turn the business around?
Some CPOs are redesigning hiring and reward systems so that employees are evaluated in part on their contributions to the organization’s mission. Others develop ‘objective metrics’ that managers discuss in relation to financial performance.
Some examples are surprisingly concrete. One executive told us that their company has terminated relationships with clients whose actions conflicted with its principles. One explained leadership meetings where managers can talk freely emotional reactions to weather-related events. Others make purpose visible in simple, tangible ways. One CPO, for example, created a ‘lamp wall’; each time an employee acts in a way that brings the organization’s mission to life, a new light is lit. Over time, the wall becomes a visual reminder that purpose is made through daily decisions and small, repeated actions.
At first glance, the practice of CPOs may seem unusual. In fact, they show a profound change in managers themselves, trying to integrate moral and emotional considerations into decision-making.
CPOs are poised to reshape the way organizations think about their social role. They are encouraging emotional engagement around shared values. See building relationships with all stakeholders and departments. And they embed purpose in tangible structures such as incentives, metrics and governance systems. In short, they try to turn abstract ideas into practical reality.
Can CPOs really make a difference?
The big question is whether companies need a dedicated executive for this job. Although the role may overlap with functions such as HR, CPOs add value by linking purpose to long-term strategy and governance. Since purpose is not static, CPOs support the evolution of purpose. They ensure that decisions reflect the organization’s responsibilities to employees, customers and communities, turning purpose into effective business direction.
Critics argue that chief executives are in danger of becoming symbolic figures with no real influence. If a single champion is in charge while the finance and staff teams control the actual decisions, nothing changes.
As a result, in some organizations, the role can be a form of corporate theater: a visible commitment to values without meaningful structural changes. Finally, intent is also difficult to measure. Unlike sales or profits, its impact is difficult to measure. That makes it easy for skeptics to dismiss the role as just another management fad.
Our research suggests that CPOs only make a difference under certain circumstances.
An organization must truly use purpose as a filter for decision-making and link purpose to strategy.
A CPO must have both legitimacy and authority. They should report directly to the CEO and participate in strategic meetings.
Leadership must demonstrate purpose, especially when it conflicts with short-term gain. If the CEO abandons the mission when the going gets tough, the whole effort falls into the trap.
When these conditions exist, organizations can change in tangible ways. Hiring practices are changing. Supplier relationships are changing. Redesigned incentive systems. Purpose begins to shape daily decisions and becomes strategically relevant.
So, do firms need chief executives? Increasingly, yes.
In a business world marked by technological disruption, social pressure and a growing distrust of corporate discourse, firms face pressure from all directions at once. They must remain profitable, innovate quickly, attract talent, respond to societal expectations and adapt to technological change. The purpose does not change these terms. It helps to connect them.
This is where great mission managers can make a difference.
Their role is about helping organizations clarify what they stand for in the face of difficult trade-offs and competing priorities.
CPOs cannot resolve these conflicts alone. But they can help organizations transform a mission from a marketing message into a real, organizational reality that can happen in the workplace.
Why Europe needs CPOs
Society raises the bar for responsible business. The European Union Corporate and Sustainability Reporting Directive again The Green Deal they now require large firms to comply financially and operationally with stated sustainability commitments and report on their impact. However, compliance alone does not create intent.
A company may report strong environmental performance while still having a clear reason for existence other than shareholder returns. The CEO is one emerging and flexible answer that helps close this gap by ensuring that the company’s mission truly shapes financial and operational decisions, driving the transformation of European businesses towards responsible and sustainable models.
To watch you
Here are some top appointments dedicated to best practices:
- Richard Boele, Chief Objectives Officer, KPMG Australia
- Alexandra Michat, Chief Mission Officer, Exo Travel
- Simon Cheetham, Chief Purpose Officer, Andrew Property & Purpose
- Priya Srinivasan, Chief People and Mission Officer, Coty
- Laura Dunne, Chief Purpose and Proposition Officer, Lincolnshire Co-op
- Caroline Jeanteur, Chief Operations Officer, Ubisoft
Ironically, several CPOs in our survey suggested that their ultimate success would be to make the position redundant over time by embedding the mission into organizational systems, processes and decision-making processes.
Yet the emergence of the chief purpose officer points to a broader shift in modern capitalism – companies are increasingly expected to demonstrate how their purpose shapes how they create value, govern themselves and respond to societal needs.
Nicole Steller
Nicole Steller is an assistant professor at ESCP Business School.
Albena Björck
Albena Björck is associate professor of the Head Global Business Lab at the ZHAW School of Management and Law.
Guido Möllering
Guido Möllering is the chair professor of Witten/Herdecke University.
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