The American Sustainable Business Council chief is thinking about carbon pricing, the minimum wage and tax havens.
Good morning.
I spoke yesterday with Jeffrey Hollander, co-founder Seventh Heaven, the Vermont-based company that makes eco-friendly cleaning and personal care products and was sold in 2016 to Unilever for $700 million. Hollander now heads the American Sustainable Business Council, whose members include 1,000 of the most progressive companies in the U.S.—Ben and Jerry’s, Patagonia, Eileen Fisher, etc.—and lobbies for policy change in Washington.
I asked him to name the three biggest policy changes that would make the kind of stakeholder capitalism he favors a reality. His answers:
• “The first one is a big one, and it is really this notion of full cost accounting. Putting a price on carbon is a big step in that direction. Companies have been encouraged to dump their externalities on society, and they would behave differently if they had to pay for those externalities.”
• “Number two is digging in on the human side of the business…When companies underpay workers, it is another form of externality,” leading to higher costs for society. The Council favors a $15 minimum wage as another “big step in the right direction.”
• “Number three is to stop encouraging companies to avoid paying taxes” by shifting their profits to overseas tax havens. The global minimum tax being pushed by the Biden administration would move in that direction.
While Hollander’s members represent the fringe of the business community, those three policy goals are ones that a growing number of corporate leaders in the mainstream are willing to embrace. When I asked him about the Business Roundtable’s endorsement of stakeholder capitalism, he responded: “We welcome them to the party. We are thrilled they are thinking about stakeholder capitalism. The biggest challenge they haven’t addressed is that they have created a system that is still very focused on shareholder profits. We have to change the incentives they created that encourages a system that maximizes profit and puts everything else to the side.”
More news below.
Alan Murray
@alansmurray
alan.murray@fortune.com
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This edition of CEO Daily was edited by David Meyer.
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