LAGOS — Legal and governance experts are calling for a rethink of the traditional view of corporate purpose, urging companies to move beyond shareholder primacy toward a more inclusive model that balances value creation across stakeholders.
The discussion was highlighted at a recent public lecture delivered by Fabian Ajogwu, titled “The Purpose of the Corporation: How Value, Values and Viability Define Corporations.” The lecture challenged long-standing assumptions that corporations exist primarily to maximise shareholder profits.
Ajogwu advocated for a multi-stakeholder approach to corporate governance, emphasizing that businesses should create value not only for shareholders but also for employees, communities, and the environment. He described corporate purpose as one that should generate value across financial, social, and natural capital without depleting any stakeholder or resource base.
“The purpose of the corporation is to create value that flows in all directions… so that no stakeholder is diminished and no capital is depleted,” he said.
Participants at the lecture noted that this evolving perspective aligns with emerging global governance frameworks and regulatory expectations, including provisions under Nigeria’s Companies and Allied Matters Act (CAMA 2020), which emphasize directors’ duties in balancing long-term interests.
Stakeholders argue that embedding purpose at board level is critical to ensuring it translates into actionable strategy rather than remaining a theoretical statement. This, they say, would require boards to actively integrate purpose into decision-making, oversight, and corporate planning.
Ajogwu further stressed that the future of corporate purpose will ultimately be shaped by the actions of directors, executives, investors, policymakers, and citizens who hold organizations accountable for both the value they create and the impact of their operations.
The conversation reflects a growing shift in corporate governance discourse, where sustainability, accountability, and long-term value creation are increasingly seen as central to business success.