The mission statement: a corporate reporting tool with a past, present, and future.

This article discusses a comprehensive study of the mission statements of Fortune 1000 higher-performing and lower-performing firms to assess the current state of the mission statement. After content analysis of these firms' mission statements, the components included for these two groups of firms were compared. The higher-performing firms included eight of the nine recommended components more often than did the lower-performing firms, and the differences were significant for three of those components. Also, using textual analysis methods, this study identified strategies employed by these firms to create a strong identity--or internal ethos--and image--or external ethos. The two groups used somewhat similar strategies for building corporate identities and images but differed in the values they emphasized and the goodwill recipients they targeted.

Keywords: corporate mission statement; corporate reporting; corporate identity; corporate image; ethos

***********

Although more than 30 years have now passed since "a furor over mission statements swept over corporate America" (Morphew & Hartley, 2006), mission statements still serve as common corporate reporting tools. Their long-term use by corporations has been characterized by significant change, however, especially in the format and delivery of these statements. For example, they are often found on corporate Web sites now. The purposes for this reporting genre have also increased and diversified, leading to some differences in the content and strategy of these statements. This article presents details about a study designed to assess the current state of the corporate mission statement by analyzing the content of statements gathered from firms included on the 2006 Fortune 1000 list. In addition, the study investigates possible links between mission statements and financial performance by comparing statements belonging to higher-performing firms to those belonging to lower-performing ones to see if there are differences between (a) the content components these firms included and (b) the rhetorical strategies they employed to create a positive corporate ethos--an identity or image.

The findings in this study affirm the continuing importance of mission statements and show that the content components included have not changed dramatically in the past 20 years. When current statements belonging to higher-performing firms were compared with those belonging to lower-performing firms, though, differences in content were again found. Higher-performing firms included in this study discussed philosophies and targeted markets more often, and they discussed strategies for survival, concern for public image, and concern for employees significantly more often. Other findings in this study show that firms in both groups used somewhat similar rhetorical strategies for building a strong ethos. For example, most of the firms used a first-person point of view to promote identification with the firms, and most highlighted values to create desirable corporate characters, although there were some differences in the specific values included. For example, the values of teamwork and safety were mentioned much more often by higher-performing firms than by lower-performing ones. In addition, all 27 of the mission statements analyzed included at least one expression of goodwill. However, the targets of goodwill differed to some extent: Employees, shareholders, and communities or society were listed as goodwill targets by more higher-performing firms than lower-performing ones.

This article concludes by predicting that mission statements will continue to be significant corporate reporting tools because of their lengthy history and the ongoing time and energy devoted to them by corporations and by corporate and communication experts, scholars, and researchers. Furthermore, based on the review of literature that informed this study, suggestions are made for ensuring that future research and scholarship on mission statements are more consistent and replicable.

LITERATURE REVIEW

The extensive literature pertinent to this study includes the following: (a) scholarship that defines the mission statement genre or makes recommendations for its content, (b) scholarship that provides a theoretical basis for expecting an effective mission statement to be associated with successful financial performance, and research to determine whether that connection can be supported by data, (c) scholarship that develops relevant rhetorical theories or discusses applications of those theories to corporate communication, including mission statements, and (d) studies of the mission statement as a strategy for creating a strong corporate ethos.

Mission Statement: Definitions

A mission statement "tells two things about a company: who it is and what it does" (Falsey, 1989, p. 3). A number of others offer a similar definition (Abrahams, 1995; Bart, 2000; Bart, Bontis, & Taggar, 2001; Collins & Porras, 1991; David, 1989; Drucker, 1973; Ireland & Hitt, 1992; Pearce, 1982), and this definition holds true regardless of whether a corporation refers to this statement as a "mission statement," a "mission," a "credo," "our philosophy," "core values," or something else (Abrahams, 1995; Collins & Porras, 1991; David, 2007; Ireland & Hitt. 1992; Pearce & David, 1987). These statements often address multiple audiences, or stakeholders, including a firm's management, employees, customers or clients, shareholders, and other residents of the communities, countries, and world where it does business (Abrahams, 1995; Amato & Amato, 2002; Bart, 1999, 2000; Collins & Porras, 1991 ; Klemm, Sanderson, & Luffman, 1991).

In addition to conveying a corporation's nature and reason for being, this statement may also outline where a firm is headed; how it plans to get there; what its priorities, values, and beliefs are; and how it is distinctive (Abrahams, 1995; Collins & Porras, 1991; Falsey, 1989; Ireland & Hitt, 1992; Klemm et al., 1991; Pearce & David, 1987). Bartkus, Glassman, and McAfee (2000) define a narrower focus for a mission statement: "We view a mission statement solely as a communication tool" (p. 29). They add that

most firms would be better off" if they nam)wed the purpose of the

mission statement to that of realistically communicating product

and market objectives to stakeholders. The best mission statements

simply define the company's business and suggest a future goal. (p.

29)

Their caution about overextending the scope of mission statements is shared by other practitioners and scholars (Bart, 2000; Collins & Porras, 1991; Ireland & Hitt, 1992).

Mission Statement: Recommendations for Content

A host of resource materials have been created to assist corporations and other organizations with drafting the perfect mission statement. Surprisingly, these guides offer somewhat similar advice about suggested content for these statements, even if they do not agree about the labels they assign to content components. For example, in an article often cited in mission statement literature, Pearce and David (1987) identify "eight key components of mission statements," a list that is modified slightly and expanded to nine components by David (1989, 2007). A corporation is encouraged to provide information about its customers or clients, employees, products or services, markets, technology, self-concept, desired public image, philosophy, and strategies for growth and survival (David, 1989, 2007).

Other authors have renamed, expanded, narrowed, or redefined the suggested components (Bart & Baetz, 1998). For instance, specifying a company's commitment to QOL (quality of life) goals has been cited as important (Amato & Amato, 2002), a commitment that others might place under the categories of a firm's general philosophy, its concern for its employees, or its concern for its public image. In addition, organizational purpose and financial goals have been studied as content components (Bart & Baetz, 1998); however, some researchers consider an organization's purpose to be a subset of its philosophy and its financial goals to be a subset of its strategies for growth and survival. Two studies note that anywhere from 10 to 25 different mission statement components have been suggested or used (Bart, 1997; Bart & Baetz, 1998). Although authors usually provide rationales for the components and labels they use, the resulting variations in terminology and definitions limit the comparability of some studies with others and decrease the long-term benefits realized when earlier studies can be conclusively replicated. Therefore, although this serious flaw in the corpus of mission statement literature has been identified before (e.g., Bart et al., 2001; Peyrefitte & David, 2006), it has not yet been remedied.

Mission Statement Content and Performance: Theory

Corporations are urged to create mission statements for many reasons: to assert leadership (Klemm et al., 1991), to inform employees about the company's goals and unify their efforts toward accomplishing them (Bart, 1998; Ireland & Hitt, 1992: Klemm et al., 1991; Pearce & David, 1987), to serve as an effective public relations tool (Bart, 1998; David, 2007: Falsey, 1989), to provide a rationale lor allocating resources (Bart, 1998; Bart et al., 2001; David, 2007), "to guide current, critical, strategic decision making" (Drohan, 1999), and to inspire enthusiasm about the firm (Bartkus et al., 2000: Collins & Porras, 1991: Ireland & Hitt, 1992).