The suits came to NYC this week in droves. The Clinton Global Initiative, which used to be the central business huddle during UN Week, gave way to abundant business networking opportunities from the Bloomberg Global Business Forum to The UN Global Compact to Fortune’s CEO Initiative and many more. The annual opening of the UN General Assembly is an irresistible backdrop to talk about complicated issues from climate to inequality. Flooding, earthquakes, and nuclear threats added to the sense of urgency.
What do we really need now from business leaders? A bias towards action.
While it’s seductive to convene about the need for tax and policy changes (while wringing hands about how hard it is to get anything done), there’s still room to take action on investments and innovations that are fully within the control of the executive — no collection action required.
Business is needed to actually DO something about inequality and financial security. Best-in-class businesses are moving ahead, taking a page from enterprises that have already made a move. It’s a critical part of the cycle of private action leading to greater trust in business and capitalism.
Earlier this month, Fortune released its “Change the World” list of business actors. There is a lot to be inspired by that aims at greater economic opportunity, especially examples like Levi Strauss’ novel program to encourage factories in places like Mexico to invest in worker well-being. The upshot for Levi’s is improved quality and dependability of the supply chain. Upfront investment is rewarded at both the contractor and corporate level. Other examples, like JPMC’s remarkable investment in Detroit, enhance the company’s reputation, while the connection back to the business and replicability is less apparent. All of these winners deserve recognition for active investment in complex problems.
Some actions within the scope of business are obvious. Taking a closer look at wages and the structure of work (does efficiency come at the expense of financial security for the employee?), profit-sharing plans, and doubling down on workplace training are all good places to start. Companies like Delta, Wal-mart, and ATT have already made big moves that others can emulate. Pearson and others embrace the UN’s Sustainable Development Goals as an organizing principle for engagement.
Others innovations are harder, especially concrete actions to reconnect executive pay to the fundamentals of long term value creation and to fairness in the workplace. The hot issue of executive compensation is still off the radar for most companies, but watch this space. Unilever has posted principles that look at both end of the spectrum. Pay experts and scholars are raising questions about pay plans that bury executives in stock and encourage stock buy backs over worker investment. Change is slow, but the need for a rethink about pay is too obvious to be ignored for long.
In his article, The Virtue Matrix, Roger Martin helps us understand how company-led innovations lead to broad scale change; he connects the intrinsically motivated first mover to fast followers who pick up the pace. At the end of the CEO Initiative, Fortune Editor Alan Murray had this to say: “Capitalism may be the best system for creating prosperity that mankind has yet invented, but there was a clear feeling among the CEOs in attendance that the system has to do a better job of spreading its benefits and proving its social value.”
Business has the chops to move the needle on issues that won’t be solved by governments. We should accept nothing less.