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I'm Not Giving Up My Seat
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By Inspired Protagonist - February 3, 2009

A Seat at the TableMy recent post, "A Seat at the Table," sparked quite a few comments. Many responses were positive, but certainly not all. One line of criticism asserted that as a businessman, I had no business writing about politics -- I should stick to making green bath tissue. Others wondered why I, as the leader of a company that's strongly associated with the environment, addressed non-green topics like health care. And then there were those who thought I was attacking capitalism when I suggested (among other things) that we "prevent shareholders who haven't held stock in a company for at least one year from voting their proxy."

First, let me say that I welcome and value all of the feedback. But rather than address each and every comment point by point, perhaps it's more productive to explain why I spoke out in the first place.

I believe that everything on the planet is part of an integrally linked system, just as Peter Senge and others have described it in their writings about systems thinking. We can't fix one part of this system while ignoring its other parts, and we can't have a "sustainable" world if we don't address issues of justice and equity. As Jonathan Porritt so eloquently wrote in Capitalism as if the World Matters, "social sustainability is entirely dependent upon ecological sustainability. As we continue to undermine nature's capacity to provide humans with essential services (such as clean water, a stable climate, and so on) and resources (such as food and raw materials), both individuals and nation states will be subjected to growing amounts of pressure. Conflict will grow, and threats to public health and personal safety will increase in the face of ecological degradation."

I am a firm believer in the power of capitalism to nourish society and (positively) transform lives. But right now, our current form of capitalism is sick and doing more harm than good. Our financial markets have turned into a huge, unregulated casino. Our system of regulations and incentives largely supports unsustainable industries. And our tax code effectively transfers wealth from the poor to the rich.

I believe that all of us in the corporate world are obligated to support and influence systems (and businesses) that increase equity, justice, and sustainability. These systems include MBA and other business-education programs; state and federal government agencies that determine the tax code, regulatory guidelines, and subsidies; economic-measurement systems such as the GDP; reporting and rating agencies such as Moody's, as well as CERES, GRI, and the B-Corp. These agencies and initiatives are potential agents for positive change, and we should all be engaged in vigorous debate on how best to leverage them.

We could start by tackling a core problem: today's world sends all the wrong signals to consumers and citizens. I'm not asking for subsidies for "good" companies. I just believe that we should level the playing field and stop incentivizing the parts of our economy that we want less of. We could begin to achieve this goal by preventing companies from externalizing their costs. When we provide Exxon-Mobil (a company that last year made more than $40 billion in profits) with $1 billion in subsidies every month, we make the cost of alternative energy artificially more expensive by comparison. Sorry, but I fail to see the logic in undercutting the alternative-energy industry by subsidizing Exxon-Mobil. I'm not anti-capitalism, but I am anti dumb capitalism.

Then again, I'll never claim that I have all the right answers. Far from it. But especially in these dire times, all of us in business have the right and the responsibility to speak out.

photo: Luis Argerich

Comments
RE: I'm Not Giving Up My Seat
Posted by shaynek | Tue, Feb. 3, 2009

Good on you Jeffrey, I'm glad you had a seat--a lot of business leaders and government ones for that matter should learn from your experience, maybe you should run for office? If only I lived in the U.S., the Canadian government seems to be going in the opposite direction these days, then again only 30% of people voted here, so what can we expect. The U.S. influences our country so much though, it almost always means we have to wait for your lead, so hopefully things will change up here soon too.

RE: I'm Not Giving Up My Seat
Posted by MorganO | Wed, Feb. 4, 2009

Jeffrey, I'm glad you are speaking out and using your voice. I think everyone has business writing, speaking, and thinking about politics because it affects each and everyone of us. For so long we have compartmentalized and separated ourselves from various things that I think now we are having difficulty recognizing and acknowledging how we and everything in our world is connected. Please keep stepping forward and offering your ideas and suggestions as to how we can address some of the serious issues our country is facing.

"The hot air of SCR"
Posted by anvor | Fri, Feb. 6, 2009

To Jeff and all,

In case you haven't seen it, below are a few paragraphs from the recent Financial Times article.

The hot air of CSR
By Stefan Stern
Published: February 2 2009 19:55

Thank goodness, now the recession’s here we can forget all that nonsense about corporate social responsibility (CSR) and get back to trying to make some money.

The good news is that serious CSR types understand this. I went to a lunchtime meeting at the House of Lords last week where this became clear. This was no crowd of burbling do-gooders. One executive declared: “I can’t stand writing CSR reports. I hate it. It’s so boring.” Another – in fact our co-host, Michael Littlechild, the head of the advisory business Good Corporation – conceded that, for many business people, CSR was just a case of BDF: “babies, dolphins and forests”.

Corporate reputation is clearly important, and highly vulnerable in the age of the internet. But is there really always a straight-line connection between reputation and the bottom line? Customers may decry company X in a focus group or opinion poll. But where do they do their shopping?

The UK discount fashion store Primark has had its name dragged through the dirt in the past year, after worrying aspects of its supply chain were uncovered. Its latest sales figures? Up by 18 per cent (aided by new store openings) in the 16 weeks to January 3, when almost every other UK clothes retailer was struggling.

We need to cut through the well-meaning waffle. One business leader who usually does is Sir Terry Leahy, the chief executive of the UK’s leading retailer, Tesco. In an article for the Daily Telegraph last week, Sir Terry let off steam about what he sees as the growing risk of over-reaction by governments and regulators in the current crisis. We risk losing sight of a few fundamentals: “free trade in competitive markets, enabling individuals to pursue their own interests, and all within a clear framework of law,” he wrote. Do-gooders, whether they mean to or not, are likely to do bad.

Yes, he went on to say, the role of something called “green consumption” could also play a powerful role for good, in cutting the use of carbon.

But it is obvious where Sir Terry’s priorities lie. In a lecture in the same week he told suppliers that they would be coming under increasing pressure to cut the prices they charge Tesco this year. How worried is Sir Terry by the thought that his suppliers may be forced into finding cheaper and potentially less environmentally friendly ways of producing their goods? Not very, would be my guess.

That’s business. And, if Tesco wants to continue competing on price, it will keep up the pressure on its suppliers. Does this constitute “corporate social irresponsibility”? Hardly. The truly responsible thing to do is to run a good business competently.

As the wise CSR practitioners know, it is how you do business that counts. All the rest is just hot air.

stefan.stern@ft.com

The rest of the article is at the Financial Times site.

Enjoy (or don't:)

Andrei Vorobiev

RE: "The hot air of CSR"
Posted by shaynek | Mon, Feb. 9, 2009

I don't think CSR is a bad thing, it's part of the solution, but not the solution in itself and it can be used as a green-wash tool. Companies like Patagonia haven't produced more than one CSR report in the last ten years, that I'm aware of, but I still know it's a good company because of other transparency in the organization. It's time government regulate corporations to the triple bottom line. Free market capitalists might see that as socialist, but if one thing has become clear over the last year, corporations are only free market capitalists when they make money, as soon as they're not (eg. GM and Chrysler) they become socialists over night and expect bailouts.