In 2019, global communications firm Edelman released its annual Trust Barometer, a survey that collected and analyzed responses from more than 33,000 workers across twenty-seven regions and countries. The survey provides valuable insight into where individuals worldwide place their trust.1
I read the results every year, but as I was working on this book, I found myself reviewing the 2018 results with particular interest. According to the survey findings that year, the entity that scored the highest on metrics of trust and confidence—higher than “government,” “media,” “NGOs,” and even “business”—was “my employer.” This was true both in the aggregate and for nearly every significant subgroup of respondents. Men and women, the informed and the mass public, even those who feel that the system as a whole is failing them all marked “my employer” as the institution they trusted most.
With that trust comes the expectation of responsibility and action. The vast majority of respondents (76 percent) want their employer to proactively address the great issues of our time, such as equal pay, climate change, and workforce retraining.2 As Edelman put it, employees want their employers to “lead on change.”
The results of this survey are a wake-up call for some employers and an affirmation for others. Employees have placed their trust in us. Workers are calling on us to help solve society’s greatest challenges.
As Thanksgiving 2019 approached, journalist Andrew Ross Sorkin devoted a special section of DealBook in The New York Times to what he called “Seeking a Path to Trust.” He noted that his annual conference, which features leaders from government and business, was peppered throughout with the words “trust” and “responsibility.” 3
“Businesspeople and policy leaders are scrambling for new ways to engender trust with constituents, including shareholders, employees and regulators. Some are trying to be more transparent and others are diving into social and political issues that used to be verboten,” he wrote.
In the waning days of 2019, I spoke with Wall Street Journal columnist John D. Stoll for an article titled “A New Year’s Resolution for Corporations: Address the Trust Crisis.”4 His premise was that every company is becoming a digital company, which will deepen consumer reliance on the integrity of all businesses and brands. “Trust is certainly eroding,” I told John, in large part because of what people are seeing in their news feeds. Politics is divisive, and controversies are endless. All these things are like a parade on the internet and inevitably will seep into companies and brands. Even in the heavily regulated insurance industry, in which strict rules are in place to protect privacy, everyone from agents who call on policyholders to IT workers in the back office, needs to be reminded that trust is ingrained in everything we do.5
Jeff Raikes, a fellow Nebraskan who led sizable portions of Microsoft’s business for decades and later ran the Bill & Melinda Gates Foundation, amplified this sentiment in an op-ed for Forbes. There, Raikes criticized “overvaluing short-term performance metrics like quarterly earnings at the expense of long-term planning and other factors like social impact.”6
This book is designed as a guide for business leaders who are willing to answer that call, particularly the challenges and opportunities related to the future of work and employment.
Ensuring that the economy of the future works for everyone is one of the most pressing challenges of our time. Businesses have a tremendous opportunity and a tremendous obligation to drive forward the changes necessary to address this challenge. The best way we can do so, I believe, is by leading on next-generation education and skills development.
If workers don’t have access to high-quality education, they won’t be able to keep up with the rapid pace of change set by technological innovation. If that occurs, the businesses that employ those workers will fall behind as well. The only way to ensure that everyone can compete in the economy of tomorrow is by investing in education today.
As we know, businesses must take the lead in developing the educational policies, programs, and partnerships that will form the bulk of this investment. We must bring the classroom into the workplace, guaranteeing that workers, regardless of age, have an opportunity to learn their way into new roles, positions, and industries. We also must bring the workplace into the classroom, enabling students to harness the power of experiential learning. We must help to reimagine the degree, innovating our way toward a credentialing system that is as flexible and dynamic as the economy of the future. Finally, we must put people first, recognizing that training a strong workforce requires supporting the whole worker.
To truly lead on change, however, we must ensure that each of these individual strategies builds toward something greater. True leadership, after all, requires more than just charting a path forward; true leadership requires charting a path toward … toward a more equitable, more sustainable, more compassionate future.
Toward purpose.
Although the core strategies presented in this book are prescriptions for change, they are, in a much deeper sense, manifestations of purpose. By bringing the classroom into the workplace, we realize our duty to think and invest long term. By bringing the workplace into the classroom, we ensure that economic advancement leaves no one behind. By working to modernize our credentialing system, we take responsibility for driving change that will benefit everyone—the people who work for us and the people who don’t. And finally, by putting people first, we reassert the importance of a simple truth: workers are whole people and deserve robust and holistic support.
To live up to the trust our employees have placed in us, businesses need to pursue purpose in all things and at all times, no matter the cost.
I understand, of course, the hesitancy to commit so fully to purpose. Some CEOs I’ve spoken to have questioned whether adopting such a strategy would conflict with their primary responsibility to ensure the financial stability of their companies. After all, isn’t it the CEO’s job to optimize things that have direct impact on the bottom line—such as costs, sales, employee retention, and innovation—before considering something as uncompetitive as purpose?
No. In fact, I believe that the best way to optimize those bottom-line measures is by leading with purpose.
For evidence of this, one need only examine the purposeful work a handful of companies are doing to address the education financing crisis.
PAYING IT BACK, PAYING IT FORWARD
Postsecondary education has never been more important. And it has never been more expensive. These two complementary, contradictory realities have produced a crisis that is stunning in its simplicity and devastating in its impact.
Between 1989 and 2016, the cost of a college diploma increased eight times faster than annual wages in the United States.7 The result is a student debt crisis that affects 44 million people across the country. Currently, Americans owe $1.5 trillion in student loans—a 500 percent increase from 2003.8 The average American student graduates with $28,650 in outstanding student loans, a figure that becomes even more distressing when one considers that the average starting salary for a recent graduate is about $50,000.9
The negative effects of this crisis extend far beyond the individual. Homeownership among young adults has declined significantly in the past decade, a fact that the Federal Reserve attributes in part to the increased burden of student debt.10 And between 1996 and 2014, the number of startups launched by young people dropped by about half.11 Instead of making investments that can help grow the economy, workers are doing everything they can just to pay down their debt. This has slowed the growth of the American economy, creating what Seth Frotman, former student loan ombudsman at the Consumer Financial Protection Bureau, has called a “trillion-dollar black hole in our financial market.”12
If we don’t act, this hole will only grow—especially as workers of the future will need to relearn and re-skill throughout their career just to keep up with the pace of change. This will no doubt be costly. And if workers are forced to bear this burden alone, it will exacerbate a crisis that is already causing harm to individuals and our economy.
Fortunately, a number of companies are working hard to ensure that such harm doesn’t occur, and they’re doing so by implementing programs guided by purpose.
In 2016, executives at Fidelity Investments realized that their employees were having a problem. In exit interviews and a coordinated listening campaign, employees spoke of the significant burden that lingering student debt posed. They spoke of deferred homeownership, delayed dreams, and trepidation about the future.13
So Fidelity launched the Step Ahead Loan Assistance Program to help employees repay their loans. Every year, Fidelity employees are eligible for a $2,000 loan subsidy with a five-year cap of $10,000.14 Since the program’s inception, Fidelity employees have amassed $22.5 million in savings through the program—or, put another way, they’ve avoided 34,625 years of loan payments.15
Abbott Laboratories, a health care company based in Illinois, is leading with purpose in another way. Abbott employs a staff of highly educated employees who hold advanced degrees in STEM fields and business and, in many cases, also hold quite a bit of student debt. Abbott wanted to share that burden with its employees but realized there was a downside to traditional direct repayment programs: giving employees money to use to pay down their loans often also increased employees’ tax burden.
To avoid this, Abbott developed a program called Freedom 2 Save. Having noticed that many employees were paying off student loans instead of saving for retirement, Abbott rewrote its policies to allow employees to qualify for the company’s 5 percent 401(k) match, by paying 2 percent of their salary either toward their retirement account or toward paying for their student loans.16 This way Abbott could support employees preparing for the future without increasing their tax burden by a cent.
Other companies are addressing the education financing crisis not by paying down debt but, instead, by paying for their employees to go back to school.
For years, health insurance giant Cigna has offered a tuition assistance program that is impressive in both its utility and generosity. Cigna will pay for up to about $8,000 for any employee to attend any school and pursue any degree, no strings attached.17 In 2018 alone, Cigna’s Educational Reimbursement Program (ERP) supported 2,500 employees as they pursued higher education, paying out nearly $12 million in benefits.18 The program’s positive impact on workers has been substantial: Participants who took advantage of the educational allotment saw wage increases of up to 60 percent over the following three years.19
In 2014, Starbucks announced a similarly open-handed tuition assistance program called the College Achievement Plan. Through a partnership with Arizona State University, Starbucks offered all its employees the opportunity to enroll in any of ASU’s sixty online degree-granting programs—for free.20 Since 2014, Starbucks has committed to investing some $250 million in the program until 2025.21 The company also has committed to ensuring that this investment supports those who often fall through the cracks. Starbucks has worked hard to ensure that nontraditional college students have the tools they need to succeed, including round-the-clock tutoring, dedicated academic and financial aid counseling, and remedial course offerings.22 By the end of 2018, of the nearly 3,000 employees who had graduated from the program, 20 percent were first-generation college students.23
Each of these programs—whether they’re aimed at “paying it back” (helping students pay down their old debts) or “paying it forward” (helping workers learn new skills for the future without incurring new debts)—are designed with the same core principle in mind: educating for the future shouldn’t cause financial ruin for employees. By investing proactively and generously, these companies lead on change and live their purpose. This in itself is commendable. But it isn’t the only impact of these investments.
In each of these cases, the company’s purposeful approach has had a significantly positive impact on bottom-line business metrics.
Fidelity’s program, for example, boosted employee attraction and retention. According to a U.S. Chamber of Commerce Foundation review, the student loan repayment program helped Fidelity increase ease of hiring and decrease employee attrition.24
Abbott’s program helped to make the company more innovative. When first developing Freedom 2 Save, Abbott ran into some regulatory hurdles. To clear these, the company petitioned the IRS to confirm that contributions to the Freedom 2 Save program would remain tax-free.25 In August 2018, the IRS released Private Letter Ruling 201833012, validating Abbott’s interpretation of the tax code.26 Since the release of this letter, a number of companies (including Guardian) have developed or begun to develop similar programs—all following Abbott’s innovative lead.
Cigna’s program, as a review by Accenture revealed, has helped to make the company considerably more efficient. Employees who took advantage of the tuition benefit were 10 percent more likely to be promoted and 8 percent more likely to stay at Cigna than employees who didn’t.27 For every dollar that Cigna put into the program, Accenture discovered, the company recouped $1.29 in talent and recruiting costs.28
Finally, the Starbucks education assistance program helped to achieve one of the most important objectives of any business: it got more customers through the door. As the company’s VP of Global Talent Acquisition, John Phillips, explains, “There is a direct connection between the way you treat your employees and customers choosing you as a brand.” And according to internal Starbucks research, programs such as the College Achievement Plan help to drive sales. “[Our customers] want to buy from a company they believe is doing the right thing,” says Phillips.29
Every business leader wants to improve employee retention, boost innovation, reduce costs, and increase sales. One of the best ways to do so, as the stories of these companies demonstrate, is to focus first on something bigger. As I’ve seen firsthand again and again over my career, companies that are brave enough to be high minded end up outperforming competitors that put metrics over meaning.
If there is a single thread that runs through all the case studies explored in this book, it is that: pursue purpose, and profits will follow.
HIGHER PURPOSE
Today’s workforce faces challenges that are unprecedented in scope and scale. Disruption moves faster, extends further, and shakes more deeply than ever before. Time-tested techniques are becoming obsolete with frightening rapidity, and uncertainty is creeping into even the most dependable of professions and industries. It’s no understatement, I believe, to say that the fundamental stability of our workforce and our economy is on the line.
We have never faced such a crisis. We have never faced such an opportunity.
If business leaders step up, we can turn big challenges into big ideas and big ideas into big advancements. We have immense resources at our disposal, the trust of the public at our back, and a productive, healthy, inclusive, sustainable society within our reach. If we act with purpose, we can profoundly change our economy and our world for the better.