In September, Veeva Systems, the publicly traded cloud computing solutions company serving the global life sciences industry, announced that it would explore the conversion to a public benefit corporation (PBC), making 'it the first Russell 1000 company to become a Delaware PBC company since the structure. was created in 2013 and is the first publicly traded company to convert to corporate governance. Veeva completed the SEC comment process and filed its definitive proxy in December. PBC's proposed conversion heads for a shareholder vote in January 2021.
The concept of giving public markets a purpose has taken root over the past 12 months, with several B-certified companies and charities, including Delaware's PBCs, going public. Veeva, as an already publicly traded company, takes a different approach, committing to stakeholder governance in order to continue to deliver favorable returns to shareholders over the long term.
The PBC perspective at Veeva began in 2014 when Veeva founder and CEO Peter Gassner tasked Josh Faddis, senior vice president and general counsel, to think about how the company should communicate its position on a goal and a responsability.
As Faddis explains, Veeva had taken unique leadership positions on issues considered “off the shelf” throughout the company's history, but the company had not publicly communicated its positions. The recording of Veeva's corporate citizenship positions naturally led to a reflection on the structure of the PBC and how the company could best reflect its commitment to achieving its goals.
Veeva believes that working to make its customers more productive and grow its employee base by attracting top talent will translate into greater shareholder value.
“We've always believed that doing the right thing for customers and employees is ultimately good for shareholders,” says Gassner. "Aligning our purpose and charter will give customers the continued confidence to partner with Veeva for the long haul and help attract world-class talent to the company for decades to come."
I recently spoke with Faddis about the Conversion process and the importance of Veeva's move into the industry as part of my research on certified B companies, charities and stakeholder-oriented businesses.
The preliminary proxy said the company's vision was unsustainable in the long term if it focused solely on financial returns. Can you say more?
Josh Faddis: Our vision is to create the industry cloud for the life sciences. This means that we ask our customers to make commitments to Veeva in many different product areas, including how they conduct clinical trials, how they handle drug safety reports, and how they communicate with physicians. on the different treatments. These are big decisions that can impact patient outcomes.
Decisions on such systems are usually long-term commitments. Customers will potentially have decades of business with Veeva if they choose one of our solutions. We are trying to put in place a structure that allows us to be a long term leader and achieve our vision. We believe that becoming PBC will help us. It's not so much the next five years. We are talking about creating the conditions for sustainable leadership in 10 years, 20 years, 30 years.
We see the financial results as a sort of spinoff, if you will. The financial results will come, but you need to focus on something bigger. Customer success has always been one of our core values. We truly believe we are a strategic partner, not just for our individual customers, but for the industry as a whole. If we strive to do a great job for clients, to be an industry partner, to ensure employee success, to innovate and our impact on society, the bottom line will follow.
Can you tell us a bit about how you and the leadership were exposed to the idea of the social service company and then the internal approval process? Often times, I've heard that it's usually corporate lawyers who have held back the adoption of this structure, so I'm very interested in your perspective.
Faddis: It was an educational process. The public utility, at least in Delaware, has only been in existence since 2013. The structure is fairly recent. We started to think formally about corporate social responsibility in 2014, which led us to create and publish a declaration of corporate citizenship on our website. This process was largely driven by our CEO, but during the development of this statement, I discovered the structure of the PBC and that's what sparked the conversation.
We looked at how to become a PBC aligned with our core values, how we are already running the business, and how our process of making important business decisions already involved thinking about the impact on key stakeholders such as customers. , employees and partners. As we reflect on the long term and how we become more important to the healthcare ecosystem - as our products have expanded significantly from pharmaceutical CRM to areas such as data, clinical trials, and security - it made sense to make a commitment to the industry that we would stay aligned with them. It was a really important consideration.
We also believed that a PBC conversion would have a positive impact on current and future employees, helping us retain employees and helping us gain consideration from candidates who might not otherwise have thought of us. And this has already started to happen, even before the conversion.
What kind of reaction have you had from both investors and industry players?
Faddis: We met our top 20 investors, other influencers and proxy consulting firms. For a representative sample of investors - especially those who are more ESG-focused, who have thought about multi-stakeholder, or who have written about the importance of goal - I would describe the reaction as almost pent-up demand. There was almost a feeling of relief - finally someone is doing this. That was a fairly large proportion of the shareholders we spoke to.
There was another group of shareholders who were not so familiar with the structure. Some had heard of B-Corp, but maybe they didn't understand the distinction between that and the PBC structure. So there was a bit of education and making sure they understood our rationale and why a PBC conversion is the right move for Veeva. Overall the response has been very positive.
Along with your announcement, which is the first public company to convert to PBC, it looks like there is a movement going on. Have other companies been in contact with you, or do you see some kind of wave of this beyond yourself?
Faddis: I don't think we have the information to say if there is a movement underway. I would say that the support we got from shareholders would probably be encouraging for other companies that are considering doing this. lemonade came out as PBC from the start, like Vital Foods. I think you'll see others doing it, and without a hitch. So I think you will see very little resistance to releasing existing PBCs.
It is difficult to say if there will be larger companies, like us, that will do the conversion. It really depends on the specifics of the industry they serve and their shareholder base. And it must be genuine. If a company's culture isn't already geared towards a multi-stakeholder approach, and its focus doesn't conform to the PBC model, I'm not sure that makes sense.
But I think over time some companies will decide it makes sense to them. However, I cannot predict how long.
You're already very stakeholder-oriented, and PBC in some ways formalizes that. After going through this, do you foresee any real changes in your business?
Faddis: As you said, PBC has more or less codified the way we've run the business for years. I think the important thing the PBC does is put in place a long term structure and formalize our goal with our legal charter. It helps us be more public about it and better support the way we recruit employees and talk with customers. But behind the scenes, it really doesn't change the way we run the business.
Did you hear something from your customers?
Faddis: We have. As you can imagine, most of the high level customer conversations have been with our CEO. It has been interesting. Some European clients who may be familiar with fiduciary obligations in UK or France may have been surprised that we were the first major US company to offer to become a PBC or that some of the multi-party obligations that PBCs do not embrace. did not already exist. United States
But again, to a very large extent, this was seen as very positive. It formally validates what Veeva has been telling customers for years, and they see it and appreciate it.
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The biggest problem founders and small owners have is that they’re experts in their field and novices in what it really takes to effectively run a business. That’s what usually trips them up, sooner or later.
Don’t let that happen to you. Admit that you don’t know what you don’t know about business, starting with these 15 tips guaranteed to help keep you and your company out of hot water. Some are straightforward, others are counterintuitive, but they’re all true. And some day they’ll save your butt.
Always make sure there is and will be enough cash in the bank. Period. The most common business-failure mode, hands down, is course out of cash. If you know you’ve got a cash flow or liquidity problem coming up, fix it now. You can’t fire bad employees fast enough. You just can’t. Just make sure you know they’re the problem, not you ( see next tip ).
The problem is probably you. When I was a young directeur, my company sent us all to a week of quality training where the most important concept we learned was that percent of all problems are management problems. When things aren’t going well, the first place to look for answers is in the mirror.
Take care of your stars. This goes for every company, big and small. The cost of losing a vedette employee is enormous, yet business précurseurs rarely take the time to ensure their top performers are properly motivated, challenged, and compensated. Your people are not your kids, your personal assistants, or your shrink. If you use and abuse them that way, you will come to regret it. Capiche ?
Learn to say ' yes ' and ' no ' a lot. The two most important words owners and founders have at their disposal are “yes” and “no. ” Learn to say them a lot. And that means being decisive. The most important reason to focus – to be clear on what your company does – is to be clear on all the things it doesn’t do.
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Trust your gut. This phrase is often repeated but rarely understood. It means that your own instincts are an extremely valuable decision-making tool. Too often we end up saying in retrospect and with regret, “Damn, I knew that was a bad idea. ” But the key is to know how to access your instincts. Just sit, be quiet, and listen to yourself.
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Far too many créateurs d'entreprise run their business like an extension of their personal finances. Bad idea. Very bad idea. Construct the right entity and keep it separate from your personal life. Know your finances inside and out. If you don’t know your revenues, expenses, capital requirements, profits ( gross and net ), debt, cash flow, and effective tax rate – among other things – you’re asking for dysfonctionnement. Big trouble.
You don’t know what you don’t know. Humility is a powerful trait for précurseurs, and that goes for new owners, veteran CEOs of Fortune 500 companies, and everyone in between. More times than not, you will come to regret thinking you knew all the answers. Behind every failed company are dysfunctional, delusional, or incompetent leaders. The irony is, none of them had the slightest idea that was true at the time. Even sadder, most of them still don’t. Don’t end up like one of them.
For every success you have in growing your market share, another or other businesses will inevitably lose ground. Here are 11 quick and easy business tips to gain a competitive advantage over your rivals and insulate yourself from the threat of new entrants in the market.
Of course, we all want to spark growth and increase revenue. But the way you do this in a sustainable way is to focus instead on the building of a loyal database of avid fans. Content digital, paired with optimized website forms and compréhensif email automation follow-up is critical to success. This approach builds trust by giving away free value before asking for someone’s hard-earned money. Not an professionnel in creating optimized lead generation pages on a website ? No worries, use a trusted tool like Leadpages to make it happen.
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Yes, it sounds obvious, but it’s so very important ! Whether consciously or not, people are more likely to buy a product if they like the sales assistant who’s attending to them. While the employee’s personality obviously has no bearing on the price or your product’s ability to serve their needs is irrelevant. Friendly customer-facing équipe will always attract more sales. Be rigorous in hiring people who are genuinely cheerful, friendly and outgoing. Make sure your training program teaches them to adopt a consistently friendly approach that puts customers at ease and feel like a priority.
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Local businesses can arguably connect with their unique communities with much greater authority than any global chain. A local retailer, hair mobilier or gardening company can sponsor a kid’s sports team and offer deep discounts for OAPs at the same time. Some cinemas feature special ‘sensory’ screenings where parents can bring kids with autism ( who would normally be overwhelmed by busy, noisy environments ) to enjoy a movie in a relaxed, stress-free atmosphere. This reflects well on them and also guarantees them a loyal customer niche. Whatever you choose to do to support your community, make sure it authentically fits with your brand offering and business journey to date.
Social media is a great medium through which to build a solid relationship with customers – just don’t forget what ‘social’ actually means ! Soul-less corporate shop-talk won’t work on Twitter. Try to give your brand some ‘personality’ when you write updates or posts. This can bring its own risks, of course. But if you get it right, the benefits can be immense. Develop a tone of voice that aligns well with your brand identity. Seek to inform, help, entertain or amuse. And most importantly – given the dire PR consequences – don’t patronize, try too hard to be funny, or tweet after a few alcoholic drinks !
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Don’t ever get too satisfied with your . You can always improve – and improve you must ! Don’t get me wrong : without the odd moment of smug satisfaction, what’s the point ? Do relish in the successful launch of a game-changing product or take pleasure in positive customer feedback. But don’t let your customers hear you banging on about it time after time ! Be alert to the common element that has led to the downfall of countless hitherto thriving brands : complacency. Imaginative, nimble and innovative start-ups often do better than big market leaders that just got lazy. You may be the disruptive innovator today, but tomorrow you could be the complacent market leader with a tired model. So try to be humble and always strive to improve. Seek inspiration from other entrepreneurs, from books and from seminars. The moment you think ‘mission accomplished’ is the same moment you become vulnerable to being usurped.
There are lots of ways in which you can improve your , and not all of them are complicated ! Try out the above tips or integrate them with your existing strategies, and let me know how you go in the comments below. Guest Author : Faye Ferris is responsible for the day-to-day management of the Dynamis APAC Pty Ltd offices in Sydney. She develops the DYNAMIS ne change pas of brands and their expansion into the Asia Pacific region as well as BusinessesForSale. com, FranchiseSales. com and PropertySales. com. If you have an interest in partnering up with Faye or advertising on any of these websites in the APAC territories, please do not hesitate to contact her on faye@businessesforsale. com.