Abstract
This chapter provides a holistic, thematic overview of the five main elements of a leadership agenda to translate the principles of stakeholder capitalism into rigorous practice within a firm to enhance its capacity to generate sustainable enterprise value. The specifics of this change agenda may vary based on industry sector, ownership form, operating model or geographic reach, but it boils down to five essential priorities for all companies: (1) align governance, strategy and capital allocation with the key drivers of sustainable enterprise value creation; (2) internalize material ESG&D risks and opportunities into enterprise risk management and innovation; (3) reinforce preparedness and resilience to crises and systemic shocks; (4) recognize that the firm is a stakeholder itself in the vitality and resilience of its operating context and partner with other stakeholders to address relevant systemic challenges; and (5) integrate financial and material non-financial information in mainstream reporting. These are the priority actions business leaders need to embrace to respond effectively to the current crisis as well as the secular forces reshaping our economies, societies, geopolitics and environment in the twenty-first century. Most of these leadership priorities touch on more than one corporate function and team, and hence Chaps. 4, 5, 6and 7in Part II present a functional view of this agenda, breaking it down into specific recommended practices, including best-practice illustrations of leading companies, for corporate governance and oversight, strategy and capital allocation, disclosure and accountability and partnerships with other stakeholders.