Alexandria Ocasio-Cortez wants the government to pay those “unwilling to work” and to end air travel as part of her Green New Deal. Kamala Harris likes the idea of offering free medical care to all Americans; Bernie Sanders would throw in free college. And Elizabeth Warren seeks to upend hundreds of years of U.S. legal tradition by making CEOs subject to personal criminal prosecution for misdeeds in their companies. This follows two years of President Donald Trump publicly assailing corporate decisions ranging from General Motors plant closings to Twitter algorithm tweaks.
Should board members and CEOs be battening down the hatches amid all this populist campaigning against business—and even calls for outright socialism?
Not exactly. “You can’t overreact to the shrillness you’re hearing out of Washington and other places,” says Mark Hogan, a global advisor to Toyota and a member of its board for five years. “You control what you can control. You do your best in supporting the communities where you work. You can’t wring your hands about the other stuff. These things go in cycles.”
That doesn’t mean CEOs, corporate directors and their advisors shouldn’t try to counteract it. Instead of simply kissing off the threat of fundamental changes to our economic system, some business leaders understandably want to engage their constituencies in defending free enterprise and address their concerns, especially among young consumers.
“Board members need to balance the arguments and say, ‘Look at all the good things businesses can and are doing by way of making investments, making contributions and giving back to their communities,’” says Idie Kesner, a director of Berry Global, an $8 billion plastics producer, and dean of the Indiana University business school. “We need to be telling that positive story to make sure all the things that business represents today are clear and understood and put in a historical context.”
The trick, of course, is how.
Make A Case For Business
The storytelling could begin by highlighting the accomplishments of a current U.S. economy in which GOP tax cuts and regulatory rollbacks have helped unleash American business to create today’s prosperity. The good news about capitalism includes 3 percent-plus growth, full employment even of minorities and previously marginal populations, rising wages, increasing consumer confidence and productivity that finally is climbing.
“More business leaders need to speak out and not just cede the airwaves and inches of print coverage,” says Steven Hantler, who was a director of Detroitbased American Axle. “As much as this is an issue of politics, even before politics it’s an issue of marketing. And liberal elites market their vision for America far better than conservatives market their vision for America.”
Indeed, many experts in storytelling believe that business leaders could become much more effective in explaining why the companies they represent—and free enterprise as a whole—remain the best economic system for America.
“Unlike a college professor who has to rely on blackboard economics to tell the story of market discipline,” says Emily Chamlee-Wright, president of the Institute for Humane Studies at George Mason University, “companies can actually tell the story of how they’re creating value, such as when they’re creating something that didn’t exist in the world before.”
Illustrating the benefits of free enterprise, for instance, could utilize many of the icons of modern life. For Apple, it could be as simple as explaining how a government committee couldn’t have created the iPhone. And any capitalist can easily make the argument that Uber and Lyft wouldn’t exist in a socialist straitjacket of overregulation and union control.
Job Creators Network is one outfit using storytelling to “fight socialism.” The eight-year-old organization started by Bernie Marcus, co-founder of Home Depot, and others provides tools to advocate for free enterprise. The group lobbies, creates educational materials and supplies confidence to business leaders “that there’s strength and safety in numbers,” says Hantler, who runs Marcus’s family office.
Warts and All
Of course, capitalists’ new toolbox must include more than just defiant salesmanship. The case for free markets should include sober recognition that the last few decades in America also have demonstrated the ugly side of capitalism.
“Corporate executives launched the greatest epidemic of executive corruption in American history in the early 2000s,” which dented the economic prospects of middle America and soured them on the Fortune 500 and Wall Street, argues Chuck Underwood, a management consultant who speaks to directors’ groups and others about generational differences.
These days, it behooves companies to adjust to the new reality that consumers and employees of the millennial generation and following Generation Z expect companies to stand for—and embrace— sublime purposes beyond merely generating sales and profits for shareholders, including social and even political causes.
“It’s debatable whether corporations can really engage in heavy social engineering,” says Bob Lamm, chair of the securities and corporate governance practice for Gunster, a business law firm based in West Palm Beach, Florida. “It’s not really their place. But it’s no longer possible for them to say it’s not their responsibility.”
