Purpose statements arrived in annual reports on a wave of excitement from businesses in the late 2010s. Driven by the requirements of the 2018 UK Corporate Governance Code, it was a new chance to differentiate yourself from competitors, strengthen claims on broader value creation and wrap it all in a nice bow. The appeal to marketeers was clear.
But a purpose statement was meant to be a meaningful addition to the report’s core messages. It should address your place in the world, laying out simply the reason your business exists beyond making money while reinforcing your culture and values.
Not long had they arrived when the Covid pandemic turned business upside down. Purpose became an essential part of the narrative as many companies stopped making money and had to demonstrate that protecting stakeholders was their primary motivation.
However, despite that, it’s fair to say purpose statements were met with a wall of scepticism from audiences from the outset. Mistrust towards the purpose of ‘purpose’ only grew as many businesses released statements that were insubstantial, generic, or lofty to the point of being disconnected from reality.
There was famously a backlash against Unilever for suggesting the purpose of Hellmann’s Mayonnaise was “Fighting against food waste” in early 2022. As investor and media criticism at the time pointedly said, “sometimes mayonnaise is just mayonnaise.”
Flash forward to the mid 2020s and transparency and authenticity are more front of mind for reporters than ever, as audiences are increasingly alert to greenwashing, marketing speak and vapid storytelling.
Building on Black Sun’s Complete 100 2025 research, which found that purpose statements are still prominent across the FTSE 100, we wanted to delve deeper into whether purpose statements have evolved in response to changing audience priorities.
Simplifying purpose
For its 2024 annual report, Natwest has simplified its purpose, moving from ‘To champion potential, helping people, families and businesses to thrive’ to ‘To be the bank that turns possibilities into progress’.
The new purpose is tighter, progress focused and ambitious. We think it shows a more confident communicator and demonstrates an approach more grounded in reality.
Similarly, Legal & General also updated its purpose this year. Its old purpose statement – ‘To improve the lives of our customers, build a better society for the long term, and create value for our shareholders’ – tried to pack a lot in while also being generic enough that it could be applied to any business.
This has been replaced by the more dynamic, ‘Investing for the long term. Our futures depend on it’.
The new statement more simply states what they do – investing – to be more straightforward, and it also raises the stakes with a direct reference to consequences. We think this is a response to the preference for transparency and authenticity we now see in the market.
We noticed changes in other statements in recent years too, with similar examples from Centrica and M&G, and we think this suggests purposes are becoming more grounded and to the point, with better consideration of the audience.
With that in mind, we also looked at how such changes were covered in the reports. We wanted to see if a change in purpose was properly discussed and whether details of the process of developing a new purpose were included, all of which can reinforce the importance of the statement itself.
For Natwest, the change was referenced in both the Chair’s statement and the Chief Executive’s review. There was also some good coverage in section 172 regarding the purpose being changed to align with a new strategy and how stakeholders were considered in its development
For Legal & General, “a renewed sense of purpose” was the heading of the Chair’s statement and the new purpose was introduced on a dedicated page alongside the new strategy. In a Q&A, the CEO said: “purpose is a huge source of motivation and pride for all our people and a point of differentiation for us as a business.”
Purpose moving with the times
Purpose statements can be an impactful part of your corporate narrative, sitting alongside your vision and strategy to tell people who you are and where you want to go.
In the reports we looked at, we found that companies are investing in evolving their purpose statements, and that they appear to understand it’s still a story worth telling.
The new statements show a new level of focus, authenticity and rationality, while the level of coverage given to the purpose changes demonstrates that businesses see their purpose statement as a key part of their story, taking the process of updating it seriously and then dedicating space in their reporting to talk about why it’s important.
