What is a responsible business? Common wisdom is that it’s one that sacrifices profit for social outcomes. But while it’s crucial for companies to serve society, they also have a duty to generate profit for investors – savers, retirees, and pension funds.  Based on the highest-quality evidence and numerous real-life examples, Alex Edmans shows that it’s not an either-or choice – companies can create both profit and social value.  The most successful companies don’t target profit directly, but are driven by purpose – the desire to serve a societal need and contribute to human betterment.  The book shows how to embed purpose into practice so that it’s more than just a mission statement, and discusses the critical role of collaboration with a company’s investors, employees, and customers.  Rigorous research also uncovers surprising results on how executive pay, shareholder activism, and share buybacks can be used for the common good.


Please see the London Business School Review article, “How Great Companies Deliver Both Purpose and Profit”, for a short summary of the book.

Chapter Outline:

Part I: Why Grow The Pie? Introducing the Idea

1. The Pie-Growing Mentality A new approach to business that works for both investors and society
2. Growing the Pie Doesn’t Aim to Maximise Profits – But Often Does Freeing a company to take more investments, ultimately driving its success
3. Growing the Pie Doesn’t Mean Growing the Enterprise Three principles to guide trade-offs and what projects to turn down
4. Does Pieconomics Work? Data – not wishful thinking – shows that companies can both do good and do well

Part II: What Grows the Pie? Exploring the Evidence

5. Incentives Rewarding long-term value creation while deterring short-term gaming
6. Stewardship The value of engaged investors that both support and challenge management
7. Repurchases Investing with restraint, releasing resources to create value elsewhere in society

Part III: How to Grow the Pie? Putting it into Practice

8. Enterprises The power of purpose and how to make it real
9. Investors How to turn stewardship from a policy into a practice
10. Citizens How individuals can act and shape business, rather than be acted upon

Part IV: The Bigger Picture

11. Growing the Pie More Widely Win-win thinking at the national and personal levels