“Our lives begin to end the day we become silent about things that matter.” — Martin Luther King, Jr.
“In the exact same way that it felt like a commercial imperative to speak out on issues in the period between 2017 and January 6, 2020, it now feels like a commercial imperative not to speak out.” — Interview with Business Executive
Research out of Stanford suggests Americans are getting weary of hearing from CEOs on the state of the world. They found a 10% decline, from 65% down to 55%, in citizens across the political spectrum who still want executives to speak up on social and political issues.
Gen Z bucks the trend holding at 70%—and the messages from within one’s own workforce are confusing at best. In the face of mixed messages, the best advice is to make sure your POV is anchored in why it matters to the business. Otherwise, the best path, one argues, is to sit down and shut up.
How does this advice apply to concerns about our democracy at risk? And what is the business leader playbook in this moment of political turmoil?
Bob Rubin, former Treasury Secretary, has shared his views. In a direct appeal to business executives, entitled, “In Six Decades of Public Life, I Never Thought I Would Write This Piece” he makes his case that CEOs need to speak up about the potential of election interference, and changes in protocols and standards that undermine rule of law, fair play, and our basic democratic infrastructure.
He directly connects risks to democracy to concerns for the business climate and the US economy:
“The rule of law, undergirded by a tradition of free elections and the peaceful transfer of power, supports business decisions and attracts foreign companies to invest. It underlies the position of the dollar as the world’s reserve currency. It bolsters investors’ confidence in the full faith and credit of the United States and lowers interest rates on our debt. The integrity of our elections, in other words, has been one of the keys to American prosperity.”
Rubin notes that many believe this election will go fine. Yet this result, he posits, is not guaranteed, and calls on executives to take seriously the risk of alternative outcomes:
“If we act now, we can still protect our government, our people and our economy — and we can preserve the benefits that accrue to all of us, no matter whom we vote for, when American elections are fair and free.”
In dialogue and interviews conducted by the Aspen Institute Business & Society Program in advance of the 2024 presidential election, we heard that executives clearly agree that a healthy democracy is good for business. But “protecting democracy” had also become tinged with partisanship, and today, many choose to stay quiet. When protecting democracy is considered as woke as human rights, diversity, and environmentalism, the chilling effect is real.
The challenges we face will not end with this round of elections. With democracy at risk, what do we truly want from chief executives?
Rubin’s concerns are important; risks to foreign investment and a low cost of capital—things that he believes assure our country remains “the best place on earth to start or invest in a business.”
But it goes even deeper than that.
Defense of democratic institutions and basic trust in our capitalistic system are deeply intertwined. As important as it is for business leaders to stand up and protect fair elections, securing our future as a democracy will require turning to the health of the commons, which continues to fray and is causing the citizenry and many young people to completely lose faith in the American “system.”
The level of distrust puts the spotlight on the balance of private self-interest vs. the public interest. What is needed now is very much in the lane for chief executives.
Rubin’s focus on sustaining commerce, investment, and the economy masks a larger problem. It’s time to dig even deeper—to consider how our markets are structured, how business is conducted, and how profits and wealth are distributed; i.e. to examine and reconsider business norms that produce the stew we are in now.
What does that look like for business leaders of corporations who have both influence and a keen interest in preserving democracy and capitalism?
It begins with clarity of purpose; a shared understanding of why the corporation exists, and how it earns its license to operate. It builds from there. For executives concerned with the long term health of our society, here are three questions that should be addressed by the board and executive:
1. Are we fully transparent in business dealings that support and engage government and elected officials?
Political spending IS corporate voice. The Center for Political Accountability publishes the CPA-Zicklin Index, the standard for transparency when it comes to disclosure of donations to elected officials. Elon Musk may get the headlines for single-handedly spending almost half a billion dollars in the midterms, but corporations are still partners in buying influence.
It bears repeating that political spending is a form of voice, reinforced by the Citizens United ruling, but in principle, still a corruption of democracy. At a minimum, we expect corporations to take disclosure of political spending seriously, to be accountable to the public. It also means paying close attention to the policies pursued by their trade groups and to assure alignment between governmental relations and what the company says they stand for.
2. Who gets what? What percentage of profits go to the workforce?
This question goes to the heart of the cynicism that people feel towards both democracy and capitalism—especially for rising generations who eschew capitalism altogether. Their antipathy towards capitalism is rooted in their experience in the workforce, search for jobs and lack of confidence in the future.
Executives contribute to growing inequality through the structure of their pay and incentives aligned mostly with the stock price as the key measure of success and rewards.
The traditional narrative about the purpose of the corporation may have been disrupted when the Business Roundtable turned away from “maximize shareholder value” as the organizing principle of a successful business, yet the incentives for CEOs, short-term pressures in the board room and fear of activists persist in elevating shareholder primacy and the growing concentration of wealth and inequality.
Finally, there’s safety in numbers. If we want executives to lean in and support both democracy and the commons, collective action is needed. It begs this question:
3. Return to Place. Where does the executive find peers to pave the road ahead?
Return to place, a refocus on community and local priorities is challenging decades of globalization; it enables executives to speak with greater authenticity, credibility, and conviction about conditions at home and in the workplace. Faith in institutions is weak, but their importance is most tangible in community. Business peers who share a local economy, education system, and an understanding of where investment is needed can enable both the workforce and the community to thrive.
What is possible when business leaders connect back to place? Rubin calls out how the close connections between workplace and community fell apart in Minneapolis-St. Paul earlier this year as ICE incited chaos and fear in immigrant communities and on the streets. The impact on the local economy was profound.
The need for connections between business and local institutions is reinforced through business partnerships throughout the country. The Corporate Coalition of Chicago unites businesses to address inequities in Chicagoland. Other new local networks that are less business centric are also gaining attention, like the Aspen Institute Weave program, or a fast-growing new network aptly named the U.S. Chamber of Connection.
On the national level, the inputs required to secure the health of the commons can become too abstract or unworkable. In communities and regional economies, where financial security, and health of families intersect with livelihoods and concerns of the workforce, the path forward becomes clear and more actionable. Connecting the economy and the commons is what makes it possible for employees to truly commit to the enterprise.
Business leaders and major employers have the power to make a difference in securing the health of the commons, and in turn our democracy and an economy that works better for all, but it requires a longer-term commitment than this election cycle; it’s about restoring faith in capitalism and the long-term stability of the business model itself.
This blog post was originally published on LinkedIn. Follow Judy Samuelson for more insights on business and society.
