Autores: Rich Lesser & Jeffrey A. Sonnenfeld
This week’s announcement by Walmart on limiting its own gun sales seems to match last month’s Business Roundtable (BRT) statement to re-frame the broader purpose of a corporation “that serves all Americans.” Over 180 CEOs of leading companies joined this statement, which, beyond merely serving shareholders, promotes a multi-stakeholder orientation. Supporters and critics wrongly saw this extension as a departure from the mission of the Business Roundtable since its creation in 1972.
In fact, the BRT founders were strong advocates of corporate social responsibility regarding employee welfare, equal opportunity, environmental stewardship, and honest business practices, consistent with what the business community now labels “ESG”—environmental, social, and governance principles. BRT leaders—such as Irving Shapiro of DuPont, Thomas Watson of IBM, and Reginald Jones of GE—advocated for the Superfund Cleanup and Acceleration Act, the Foreign Corrupt Practices Act, and affirmative action in the workplace.
This latest Business Roundtable edict supposedly challenged economist Milton Friedman’s admonition that “the social responsibility of business is to increase its profits” with a focus only on the supremacy of shareholders. In reality, Friedman’s statement was not to underscore prevailing practice, but was meant as a correction to the then-surge of corporate do-gooders. Furthermore, even the forgotten rest of Friedman’s commentary acknowledged, “It may well be in the long-run interest of a corporation…to devote resources to providing amenities to that community.”