The Canadian Purpose Economy Project (CPEP) recently released their new report, State of Purpose Governance in Canada, to better understand the board’s role in oversight of corporate purpose, known as “Purpose Governance”. Corporate governance standards and expectations continue to evolve in response to rising demands from investors, regulators, and stakeholders – and in response to continuous improvement on the part of high-performing boards. In recent years, with more companies clarifying their purpose as their meaningful reason to exist, their boards are beginning to broaden their oversight role to include purpose.

This trend to purpose governance is a welcome one, as boards that fail to oversee their company’s purpose face a governance gap. They put their companies at risk of inauthentic purpose or “purpose washing”, and worse, fail to realize the commercial and social impact of their purpose.

Our Affiliate Partners Competent Boards and Governance Professionals of Canada were among the five Canadian governance organizations that surveyed their members for the report to understand the nature of the board’s oversight of purpose and whether the board faced any challenges in taking on this role.

Nearly two hundred corporate directors and governance professionals responded to the survey. While most respondents reported that they are advancing their purpose through their corporate strategy, they also reported facing some purpose governance challenges, particularly how to monitor and disclose purpose integration and impact. Going forward, respondents believe purpose expertise or experience will be an important consideration in board recruitment to help address knowledge gaps.

For the complete insights from the survey, read the full report: State of Purpose Governance in Canada