CLICK TO SHARE
Many people on the right fear "woke capitalism" and the idea that corporate executives will bend to pressure to advance a vision of the world that replaces their values with progressive ones. To those who are worried, I say, be grateful for the profit motive. To the progressives pushing for such practices, I say, be careful what you wish for.
Regular free-market capitalism has no conflict with companies spending their own money in pursuit of whatever goals they choose. Milton Friedman himself wouldn't raise an eyebrow over a devoted LTBGQ baker who bakes cakes only for same-sex weddings or a company that only hires workers from underrepresented minorities. But woke capitalism gets more controversial when the likes of Delta Air Lines, JPMorgan Chase, and Apple use inflammatory and questionable talking points against Georgia's voting-reform legislation, or when Major League Baseball pulls its All-Star Game from that state in protest.
"Woke" is a loaded, political term. The passion it triggers obstructs the fact that behind the whole concept there is a genuine set of values, and many of them—like tolecurance and equality of opportunity—are worth promoting. However, when practiced by corporations under pressure from vocal customers, employees, or even investors, woke capitalism often incentivizes high-noise, low-cost signaling rather than actual cultural changes.
There is some evidence, for instance, that some companies are more likely to be woke when it won't cost them many customers. I don't know whether that was on Delta executives' minds when, in 2018, they used a very public announcement to end a travel discount for NRA members flying to its annual convention. But with only 13 customers benefiting from the discount, Delta lost almost nothing. The company's wokeness didn't increase its share prices, according to at least one analysis, and there's no reason to believe it decreased gun violence.
Other companies talk a big game but make no actual changes to their business models. A case in point is the group of 136 companies that first signed on to the Business Roundtable's statement on the "Purpose of a Corporation," which boasts a commitment to deliver value not just to shareholders, but to all "stakeholders," including customers, employees, suppliers, and communities. Yet two years after the signing, the companies' updated corporate governance guidelines showed no real change or attempt to elevate stakeholders. Most of them even reiterated their commitment to shareholders' primacy. Eighty-five percent didn't even report signing it in a proxy statement sent to their shareholders. The ones that mentioned it didn't add how they would change their business models.
If you don't see any comments yet, congrats! You get first comment. Be nice and have fun.
CLICK TO SHARE