The American culture wars are stoking up ahead of the 2024 election season. In this country, where we manage to disagree about many things from guns to gender to parents’ rights, climate change, and the environment are now making their way to the top of our conflict agenda.
The political right is outraged that oil and gas enterprises–and the jobs they represent–are under threat. Meanwhile, the left sees a burning planet and wants the financial sector and public institutions to divest their fossil fuel portfolio and bar oil and gas executives from COP conferences and polite company.
As extreme weather conditions increase, the public is perceiving climate change as a major human-caused problem–and wanting companies to communicate what they’re doing to mitigate environmental concerns.
Corporations are often stuck in the middle. Many are ducking for cover while they continue to do what responsible companies do: make money, serve their constituents, and do some social good.
Can common sense and conciliation find their way into this scrum? I asked some of America’s top executives.
Alex Gorsky, the chairman of Johnson & Johnson, was instrumental in the development of the landmark 2019 corporation statement by the Business Roundtable. It stated that companies should serve not only their shareholders, but also deliver value to their customers, invest in employees, deal fairly with suppliers, and support the communities in which they operate.
At the time, Gorsky said it was “the way corporations can and should operate today…and affirms the essential role corporations can play in improving our society when CEOs are truly committed to meeting the needs of all stakeholders.”
This was a departure from the previous, pervasive narrative by economist Milton Friedman that profit was the essential purpose of a company.
Gorsky told me the revised purpose was influenced by multiple stakeholders–including the “guy in the street”–feeling that capitalism wasn’t working as it should, as well as by CEOs’ increasing focus on all constituents, not just shareholders.
In the midst of today’s controversies, Gorsky says balance and long-term, sustainable business performance should be the focus, beyond the next quarter and the next controversy.
But balance is certainly not easy when the wolves are at your door. Steve Parrish, who was a top negotiator for the tobacco industry back in the big tobacco settlement negotiations (talk about controversy…) today says that progress is often stymied when both sides think the other is bad and doesn’t understand.
Geoff Morrell agrees. He is now head of strategy and communications at CEO advisory firm Teneo, and previously led corporate affairs at both bp and Disney. He jokes that 100 % of Americans think 50 % are crazy. He says that companies are “still doing the right things,” but have become far more cautious about speaking out. They haven’t curtailed their ESG agenda, but they are conducting it more quietly–choosing to take less public credit to avoid backlash.
Candi Wolff, the head of global government affairs for Citigroup, is wrestling with the policy side of all this. The EU and the U.S. are at odds over ESG (environment, social, governance) disclosure and reporting regulations. This is yet another–and related–management headache.
Morrell says we need to tone things down and listen to each other. Can we do that? Corporate leaders would surely like it and their stakeholders could benefit.
Can reason prevail in today’s climate? With nobody on either side of the culture wars taking prisoners, and the political campaigns heating up, it will be hard. But it’s worth a try.
Bill Novelli is a professor emeritus at the McDonough School of Business at Georgetown University. He was CEO of AARP and at Porter Novelli, the global PR firm. His latest book is Good Business: The Talk, Fight, Win Way to Change the World.
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