The last of the five questions (see here) is about American politics. I’m aware that some CEO Daily readers would prefer if I completely avoided it. Today, neither political party is a good fit for business. As evidenced by the struggles of Disney, AB Inbev, and Target, the Republican right has declared war on “woke” businesses that implement the kinds of diversity and climate policies that have become standard operating procedures in today’s talent-driven corporate environment. The Democratic left, on the other hand, has distanced itself from industry, viewing profits as immoral, and favouring excessive regulation.
It makes sense that the majority of CEOs desire to avoid the public eye. But just as technology, geopolitics, and climate change cannot be ignored, neither can politics and its byproducts. Six years ago, Harvard’s Michael Porter was correct when he stated in Fortune that the biggest threat to American competitiveness is a dysfunctional political system. In the long term, businesses can’t prosper in a nation with corrupt governance.
So how do we interact? First things first, motivate workers to vote and participate. Second, aid middle-ground politicians; they require it. Today’s business leaders should be furious centrists if they are concerned about the future of capitalism. Third, think about supporting nonpartisan initiatives to strengthen the majority, such as the “final five” voting system employed in the most recent Alaskan election. The most important thing is to put the effort into defining your company’s values—the things you are prepared to stand up for.
If the issues that beset Disney and AB Inbev have taught us anything, it’s that hesitancy is the worst course of action. Companies must decide in advance where they are willing to take a stand in light of the bitter political year that lies ahead. It’s too late if you wait until a crisis occurs.
Some readers will undoubtedly inquire about the “No Labels” initiative to put out a third-party presidential candidate. On that endeavour, I tend to concur with Bill Galston, who co-founded No Labels but later quit over disagreements with the organization’s intentions to field a third-party candidate.
Although there is a little chance that such an attempt will be successful, there is a greater chance that it will hand the election to a vocal minority.
On October 3 in Washington, D.C., a panel of seasoned political experts including Democratic Sen. Mark Warner of Virginia, one of the few centrists in Congress, will join the Fortune CEO Initiative to offer guidance on how businesses should negotiate these shoals. You can learn more about the project.