Throughout U.S. history, business leaders like Robert Morris, Jay Cook, JP Morgan, Barnard Baruch, Averill Harriman, Chester Bowles and Ellsworth Bunker were as renowned for shaping public opinion as they were for private sector leadership. Yet, the concept of CEO as corporate statesman has been a matter of debate.
Economist Milton Friedman famously advised that “the only social responsibility of business leaders is the bottom line.”
Many years ago, while still CEO of GE, Jack Welch told me about the reception he received as a new member of the Business Roundtable (BRT) when introduced by his predecessor, Reginald Jones. “I took out an order pad to do some business, and they all looked back at me in horror—like I was Darth Vader,” he recounted, lamenting that the group of high-minded business titans seemed more concerned about societal issues than the possibility of being outpaced by global competitors.
The BRT was founded in 1972 by CEOs of corporate behemoths like GE, IBM, Alcoa, GM, AT&T, Exxon, American Express and DuPont, who aimed to combat the perceived growing public hostility towards business in the late 1960s. Amid ongoing battles over civil rights, the antiwar effort and environmental activism, GE’s Jones championed “corporate social responsibility” and CEOs like DuPont’s Irving Shapiro spoke up on behalf of corporate America.
“The question for business—
and the BRT—is really this:
If not us, then who?”
By contrast, in recent decades business was virtually mute during a time characterized by national regulatory excesses, budget stalemates and bureaucracy, as well as the forging of Sarbanes-Oxley, Obamacare and key trade deals. More recently, with a newer generation now at the helm and a more business-friendly administration, CEOs began flocking to DC to serve on prominent White House councils.
Then came Charlottesville and a weekend of racial violence capped by President Trump’s perceived inflammatory assignment of shared blame between the murderous assault of armed white nationalists and peaceful protestors. Resigning from a presidential advisory board in its wake, Merck CEO Ken Frazier, stated, “As a matter of personal conscience, I feel a responsibility to take a stand against intolerance and extremism.” Frazier, one of three Fortune 100 black CEOs and among the BRT’s most revered members, has a career that epitomizes the American Dream. Unwisely, President Trump responded by attacking Frazier’s sterling character and his iconic firm.
The CEOs of Unilever, HPE, Disney, Intel, Under Armor, Walmart, BlackRock, UPS, PepsiCo, IBM, EY, GM and Campbell Soup spoke out in solidarity and stepped down from presidential councils. Four White House business advisory groups also disbanded, as U.S. business leaders opted to shun national service rather than risk being exploited for divisive political agendas.
The problem is that the country can’t afford CEOs to retreat right now. At a time when public opinion polls show respect for political leaders at an all-time low, CEOs remain one of our society’s most trusted groups, according to a 2017 Edelman study.
Simply walking away is not an option, and many CEOs know it. “IBM will continue to work with all parts of the government for policies that support job growth, vocational education and global trade, as well as fair and informed policies on immigration and taxation,” IBM’s Ginni Rometty recently said, and she’s right. But she can’t do it alone—no company or CEO can.
The question for business—and the BRT—is really this: If not us, then who?