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Last week, in Brazil, I had the opportunity to address corporate leaders from some of the most prominent companies in the world, from Google and Facebook to Audi and Pepsi. The topic, broadly speaking, was “What Is Leadership in the Twenty-First Century?” These were mostly (but not exclusively) tech companies, and my presentation revolved around the impact of technology in modern society, its promises and existential threats.
The usual model for a business, at least from the outside, can be simplified as thus: The product, or products, must be sold at the most profitable margin possible. This requires an efficient and creative staff, a lean production line, a good distribution center, an appealing advertisement platform, and, of course, a captive consumer. It is quite a challenge for any company to excel in all of these categories.
To improve profits, companies tend to cut down expenses in production, use cheaper materials, low-paid jobs, bad compensation packages (the recent complaints from Amazon warehouse workers come to mind, a cheaper workplace, and other even less appetizing options. Companies that focus on the outdoors, like oil and gas, timber, mining, or large farms, might cut costs by ignoring waste production, not worrying or cleaning after air and water pollution and general environmental degradation. Pharmaceutical companies may charge absurd prices for some of their drugs in complete disregard to their mission to alleviate human suffering.
As I had a captive audience, I stressed that this age of corporate moral disregard should come to an end. I saw a few heads bobbing. We can see signs that things are changing, even if slower than most of us would like. I repeated:
The age of corporate moral disregard is coming to an end.
Case in point, visit, for example, Chevron’s website. You will quickly notice that most of the opening page centers around headlines like “Creating prosperity,” including a photo of a woman working on her solar panel in what appears to be a third-world country. Their 2018 report on “Corporate Responsibility” says things like this: “Chevron supports the United Nations Sustainable Development Goals to deliver value for global societies.” Further down, “Protecting the environment is at the core of the Chevron Way.” We see pictures of wind farms too. Corporate responsibility is their central message.
Other companies say the same. Go to Shell’s website to find this very promising statement on the main page: “Shell is a big company that supplies around 3% of the energy the world uses. We want to play our part and contribute to the global effort to tackle climate change and meet the goal of the Paris Agreement. Working towards our Net Carbon Footprint ambition is how we plan to do this.”
Unless hypocrisy can go unnoticed forever, we sense that something is happening. The message is changing. And finally, I believe, for the better. Corporations are beginning to understand that, at the end of their production, manufacturing, and distribution chain is a human being—just like the ones who are working for them. They are beginning to wake up to the fact that every company needs not only a code of conduct and a mission statement, but also a soul. It is the corporate soul that speaks to the consumer, who will scrutinize how the company’s values and actions align with his/her own, and now more than ever with such easy access to news and data from so many sources. Smart businesses know that to be successful they must make the consumer into their ally, their partner; they know that the chain of production and the act of buying form one big whole, like the mythic Ouroboros—the snake that eats its tail and closes itself in a circle.
They know that the secret is to create brand allegiance.
And how’s that going to happen? Well, the examples I gave above and many others point to the obvious fact that as society becomes increasingly aware of the existential risks from global warming and environmental degradation, the companies of the future—the ones that will have a future—need to restructure their message around the search for low carbon emissions and low overall environmental impact.
21st Century values
They must respect their employees and their clients. They must strive to align their business practices with 21st Century values, where consumers, especially younger ones, are more attuned to the impact companies have on the world.
More than twenty-three centuries ago, Plato elaborated a pedagogical plan for future leaders in his book The Republic. His goal was to educate the philosopher-kings, leaders who had a broad intellectual, physical, and moral base to be the mentors and role models of the communities they served. Even if Plato’s strategy didn’t quite work out at his time (it did to a point, as his pupil Aristotle mentored none other than Alexander the Great), it could be easily bootstrapped from political leadership to the new leadership in the corporate world.
What kind of human being do you want to see at the helm of a company you buy products from? What does the company stand for in the world? What are its values? We live in an age where major corporate leaders have become celebrities—Elon Musk, Jeff Bezos, Mark Zuckerberg, Steve Jobs, Bill Gates, Larry Page, Sergey Brin. Do their companies or brands reflect your values? Are their practices ethically aligned with yours?
As long as there are choices in the marketplace, consumers have much more power than they believe. If corporations embrace values that resonate with those of a growing number of consumers worried about the future of our species in a highly stressed world, they will definitely be ahead of the game.
And it can’t be only lip service. It’s actions that count here, not words.