Purpose at the pinnacle: Why boards must reclaim organisational intent
Image: AI Lab
Nqobani Mzizi
For many organisations, the word "purpose" has become an aspirational placeholder—framed on walls, repeated in reports, and recited at town halls. Yet too often, it remains disconnected from the daily decisions that shape an organisation's impact. When boards treat purpose as a branding exercise rather than a governance imperative, they reduce it to performance theatre. This squanders the board's most powerful tool—the ability to drive true strategic alignment and long-term value creation.
The board is the highest custodian of purpose. Defining purpose is not management's job alone. That accountability lies at the board's apex. King IV echoes this, stating under Principle 1 that the governing body should lead ethically and effectively, and under Principle 4 that it should ensure the organisation is seen as a responsible corporate citizen. Purpose is the anchor aligning ethical conduct and strategic direction. According to ISO 37000, the international governance standard, organisational purpose is the foundation from which all governance conditions and practices flow.
Yet in too many boardrooms, purpose is treated as abstract or sentimental—useful for external messaging, but irrelevant to risk oversight or financial strategy. This failure to anchor purpose at the governance level explains why so many organisations drift. Without clear organisational intent, strategy becomes reactive, culture becomes performative, and stakeholder trust becomes fragile. And while boards may pride themselves on fiduciary rigour or ESG compliance, they often overlook the foundational question: 'what are we here to do, and for whom'?
Organisational purpose is not a slogan. It is a directional force. When articulated with clarity and courage, it helps boards make trade-offs, allocate capital more wisely, and weigh long-term implications against short-term wins. In times of crisis or disruption, purpose becomes the compass. But a compass only works when it is consulted. And boards that delegate purpose-setting to branding consultants or CSR departments are not governing; they are observing.
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South African examples illustrate this alignment. Take African Bank: its board anchored the organisation's mission to 'advance lives through financial services,' ensuring strategic decisions, from capital allocation to product approval, reflected this intent. When launching Isiko, a financial product designed for culturally significant events like lobola or cultural ceremonies, management's proposal was evaluated against the board's governance lens: does this meaningfully advance lives? Does it align with our broader social relevance? By treating purpose as a strategic filter, not just a slogan, the board turned intent into accountability. This contrasts with organisations where purpose is rubber-stamped but absent from key decisions.
Discovery, under Adrian Gore's leadership, provides another example. The Vitality-based business model, which incentivises healthier behaviour through financial rewards, has been underpinned by a clear purpose: making people healthier and enhancing lives. The board has integrated this purpose into international expansion strategies, risk frameworks, and partnerships, ensuring that the business logic aligns with its social intent. Discovery's directors understand that purpose, when governed actively, is not a constraint, but a multiplier of innovation and differentiation.
Another glaring case is that of Unilever under the leadership of Paul Polman. He challenged the status quo by embedding sustainability into the core of business strategy, encouraging longer-term thinking even when quarterly earnings suffered. The board backed a shift away from short-termism, aligning its oversight functions with Unilever's Sustainable Living Plan. The board's resolve to support Polman's decisions amid investor resistance shows how purpose can be governed with conviction, not just communicated.
Conversely, when purpose is absent or allowed to fracture, organisations risk governance drift, cultural malaise, and even catastrophic ethical failure.
Intention is not enough. Purpose must be fully embedded in strategy, oversight, and reward, integrated into board processes and strategic decisions. Is purpose considered when approving strategy, setting KPIs, evaluating executive performance, or assessing risk appetite? Does the board measure the alignment between stated purpose and stakeholder perception? Or is purpose left behind once the mission statement is signed off?
Purpose also acts as a powerful diagnostic tool. When governance failures emerge, whether through ethical lapses, reputational harm or cultural toxicity, they often reflect a disconnection between stated intent and actual behaviour. Purpose, when governed well, is a form of risk mitigation. But when left untethered, it can become a source of disillusionment. Stakeholders are increasingly attuned to authenticity, and they hold boards accountable not just for financial results, but for moral coherence.
This is not to suggest that boards must become moral philosophers or abandon profit. Rather, it is to remind us that profit without purpose is extractive and unsustainable. A well-governed purpose does not undermine commercial viability; it enhances it by providing a consistent framework for decisions, a north star during uncertainty, and a narrative that binds employees, customers, and investors to a shared vision.
Reclaiming purpose is not about rewriting taglines but about embedding intent into the DNA of governance. Boards serious about reclaiming purpose should ask: Are we governing purpose as a core board responsibility or outsourcing it to brand managers?
Do our strategic decisions reflect our declared intent, especially when trade-offs are required?
Have we built governance processes that test for purpose alignment across performance, risk, and remuneration?
Are we willing to revisit our purpose when stakeholder needs, societal expectations or market realities shift?
As boards prepare for increasingly complex futures shaped by technological disruption, climate imperatives, and shifting social expectations, purpose becomes more than a virtue. It becomes a necessity. It is the one thing that cannot be automated, outsourced or legislated. It must be owned. At the highest level. With clarity. And with courage.
Nqobani Mzizi is a Professional Accountant (SA), Cert.Dir (IoDSA) and an Academic.
Image: Supplied
* Nqobani Mzizi is a Professional Accountant (SA), Cert.Dir (IoDSA) and an Academic.
** The views expressed do not necessarily reflect the views of IOL or Independent Media.
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