About Those Captains of Industry…

I’ve been pretty hard on big corporations in several blog posts, and I stand by my criticisms of the behaviors I’ve identified.

That said, the Washington Post recently published an interview with Tim Cook, the CEO of Apple, and it reminded me of the danger of political rhetoric–including my own– that oversimplifies and labels.

On the right, the villains are Muslims, immigrants–actually, pretty much anyone who isn’t a white Christian. On the left, it’s big corporations and rich people.

It’s not that simple.

There are certainly decisions that Apple and other corporate behemoths have made that I personally question, but in many ways, Apple has been a pretty exemplary corporate citizen. As the introduction to the interview notes, Cook has been credited with making the company more systematic, transparent, and team-oriented.

He has engaged on social issues more than most CEOs, writing op-eds on legislation that limits gay rights and making the extraordinary decision earlier this year to oppose the FBI’s request to unlock the San Bernardino killer’s phone.

Cook–like many other thoughtful businesspeople–understands that a focus on short-term profits can undermine the elements of corporate culture than are essential to long-term prosperity. (There’s that “self-interest properly understood” theme again…)

I also think that the traditional CEO believes his or her job is the profit and loss, is the revenue statement, the income and expense, the balance sheet. Those are important, but I don’t think they’re all that’s important. There’s an incredible responsibility to the employees of the company, to the communities and the countries that the company operates in, to people who assemble its products, to developers, to the whole ecosystem of the company. And so I have a maybe nontraditional view there. I get criticized for it some, I recognize. If you care about long-term shareholder return, all of these other things are really critical.

The lesson here isn’t about Apple, or Cook.

Those of us who deplore “us versus them” politics, who remind our fellow citizens that the American constitution requires evaluating our neighbors as individuals, rather than members of groups, need to practice what we preach.

Every corporation is not Koch Industries or Walmart. Every billionaire is not Donald Trump.

When Freedom Indiana was fighting efforts to marginalize the gay community, the most persuasive voices against bias were those of Eli Lilly, Emmis, Cummins and other large companies. When Costco demonstrates that better pay and employee benefits translate into higher profits, employers who would never listen to social “do gooders” take note. When billionaires like Nick Hanauer insist that the real job creators are consumers, and that only by paying workers more can we grow the economy, people listen who would never listen to me, or to other “pointy head” academics.

We need to work toward a culture that recognizes the differences between the responsible and the irresponsible; a culture that rewards good corporate citizenship, and shames the profiteers.

Prejudice is the tendency to paint with a too-broad brush; it is failure to draw appropriate distinctions.

18 thoughts on “About Those Captains of Industry…

  1. Very correct and very timely. We need a reminder that our biases can become too entrenched and over-reaching.

  2. Exactly. I agree that sometimes, I do the same…there are many spokes to the wheels of capitalism. I just wished that unions were stronger or more wide spread so that all of us could have a work/life balance that complements our goals so that more could benefit from their hard work.

  3. Thank God for people like Tim Cook, Jeff Bezos, Warren Buffett, and Bill Gates. This world would be much worse off without them.

  4. Sheila: “We need to work toward a culture that recognizes the differences between the responsible and the irresponsible; a culture that rewards good corporate citizenship, and shames the profiteers.”

    It’s not the difference in the companies, it’s the difference in the leadership that makes the difference. That’s where the REAL DIFFERENTIATION lies, as Sheila has so well pointed out.

  5. Tim Cook is in the minority, and so are the rest of the names mentioned. Albert Einstein told us in the 40’s that both “communism and capitalism are evils”. He explained how both systems work against our instincts as human beings – we are both individualistic, yet connected to each other spiritually. We need to foster growth in both – it’s not an either/or proposition. However, both communism and capitalism inherently work against our dualistic instincts.

    His article, “Why Socialism”, is an excellent read full of insight.

    Our political system is corrupted with moneyed interests derived from private sector. The unions and private sector owns our public sector.

    Just curious, with unions representing less than 15% of workforce, whose interests are they representing? All workers? Does the teacher union advocate for politicians representing the best interests of all workers, or just those who will support teacher unions?

    When corporate lobbyists like the U.S. Chamber push policies on our politicians and offer them money for campaigns, do they represent all corporations? Or, just the corrupted players?

    It’s not the individual players – it’s the system. What happens to all the honest politicians once they enter a corrupted political system? The system chews them up and spits them out.

  6. I agree with you Marv, to the extent that good corpoarate ‘citizenship’ requires an exceptionally good citizen at the top. However, once a healthy corporate culture is created, the cooperation of most of its members is necessary. If nothing else, all must be on board to support the leadership at the top when they buck the headwinds of complacency, profit only thinking and maintenance of the status quo.

  7. I think that it’s not a bad assumption that 5-10% of every single group are at least pseudo criminals. They consistently either break the law or the public trust. That applies to men and women, government and business, black and white, immigrants and citizens, religious and secular, rich and poor.

    They cause all of humanity’s problems.

  8. I agree, it is good to have a reminder, but to be honest I never say ‘all’ corporations, ‘all’ rednecks, all whites, all blacks….I agree with Todd on this one. The good corporate companies seem fewer and far between.

  9. When Milton Friedman publicly stated in the mid-70’s that the purpose of corporations and their Boards is solely to maximize profits, it gave them permission to not care about employees or their communities. Most corporations now only care about profit. The companies with leaders who worked in the communities that they lived in used to care about their communities. That no longer happens.

    While I understand that there may still be the Very Rare company that cares about their community, I cannot agree with today’s post.

  10. I have continually blogged that I still cling to the faint hope that capitalism can be saved from – guess who – the capitalists. Kramer is right that we are at the mercies of corporate leadership, and since the courts have now been drawn into the vortex that corporations’ sole responsibility is to be found in “shareholder value,” expect shareholder suits against enlightened corporate leadership who look at the community and employees as actors in the corporate adventures in market-based economies.

  11. Well I hate to be wet a blanket, but this idea that my Oligarch is better than your Oligarch is more than a bit of reach. Wouldn’t it be great if you could refuse to pay your taxes until you decided your tax rate was “fair”?

    That is, of course, not the way it works. Unless you’re Apple. Try reading this about Apple. https://theintercept.com/2016/08/16/ceo-tim-cook-decides-apple-doesnt-have-to-pay-corporate-tax-rate-because-its-unfair/

    Bottom line we have numerous companies that are so very happy to make their products in Communist China. A country that is a one party dictatorship. Some how through an onerous convoluted rationale Communism as expressed as one party dictatorship in Cuba is bad, but OK in China.

    So it is a near perfect world for the Oligarchs, and Multi-National Corporations use the power of dictatorships to insure labor does not get frisky and ignore clean air or clean water protections for the people. Then take the sales and profits and stuff them in some low tax country.

    The next piece is to have a McMega-Media that ignores and/or puts a happy face on all the brutalities and corruption endemic to our system.

  12. I could not agree more, Sheila, and Smekens above also makes a very good point. Please consider this point of view from someone who knows something about doing business in the US. It is absolutely about the leadership of the companies. Corporations are dictatorships, and their leaders are 100% responsible for everything they do — boards and chief executives. There are many of those folks who are good people trying to do good things for other people and their communities, but they are part of a fundamentally competitive system. They would like to pay people better, make more environmentally responsible solutions, etc., but some of their competitors will not, and those decisions put them at a competitive disadvantage, which is financially suicidal. It is even more difficult in mature industries, which most of them now are, where competition on price is fierce so margins are razor thin.

    I am a progressive, but I can tell you that berating our business leaders does nothing but drive them to the chamber of commerce and others who will protect them in DC. If we really want to make a difference, we need to recognize the structural problems that drive us to behave in the ways we do. Our corporate system is broken and will not allow us to succeed as a country in a future that will be dominated by other countries using more cooperative systems to coordinate their attacks on the world markets. The difference between Japan and the US in the 1970’s and 80’s was Japan’s national industrial policy vs. the US encouraging pure competition among its companies. They built cars while we built quarterly shareholder statements. Now we face the same problem, but from another 50 nations simultaneously.

  13. Make more money regardless of the impact of others only works when highly regulated and the skewed wealth distribution that it causes corrected by regressive taxation. That’s not theory but human experience.

  14. Over it,

    “If we really want to make a difference, we need to recognize the structural problems that drive us to behave in the ways we do. Our corporate system is broken and will not allow us to succeed as a country in a future that will be dominated by other countries using more cooperative systems to coordinate their attacks on the world markets.”

    It doesn’t appear, at the moment, that we have the resolve to do that. But things can change without notice. I’m betting on that.

  15. Just catching up, but I thought I would add this interested case in business contrasts –
    Sol Price, credited with founding the concept of the warehouse store –
    Sam Walton, of Walmart fame, said that he took his ideas from Sol Price’s Price Club and FedMart warehouse businesses.
    James Sinegal, co-founder of Costco, learned the business as an employee of Price’s Price Club and earlier FedMart.

    Walton only learned half of the lessons that Price had to teach which is why the corporate images of Walmart and Costco are so different.

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