Why do we need a new way of doing business?
Wow. No short answer to this question but, let’s start with this… Growth is not necessarily good and it is most certainly not sustainable. Measuring the health of global economies by whether we are experiencing growth, ignores the fact that the planet and the Human Race cannot survive if this paradigm is maintained.
How have you helped make the world a better place?
Our family business is 142 years old and is currently being managed by the 4th generation of Schwerdtle’s. All four generations of our family done their best to treat our co-workers fairly and be respectful of their quality of life, both at work and outside of work. We have a strong tradition of giving back to our local community by volunteering in support of education, the environment, and voters rights. Without having a specific word or phrase to describe what we believe in and how we behave, our values have always been aligned to managing for long term, sustainable goals and we have always recognized crony capitalism and its history of exploitation of people and the environment as a bad thing.
What does Conscious Capitalism mean to you?
The Conscious Capitalism organization – supports companies in their efforts to manage for long-term, sustainable goals. It offers Schwerdtle Inc. opportunities to connect with and learn from other business leaders who see clearly that what has worked in the past has lead us to the cliff’s edge.
Together, by systematizing the tools utilized by conscious capitalists, we can learn best practices and at the same time, educate other business leaders on the alternative to the currently rigged system. We need a new way of measuring success because the old way is destroying our planet, turning productive wealth generated by healthy, well-run businesses into private wealth.
And, what is wrong with private wealth, you might ask. If that wealth was gained by buying businesses and then stripping them of their true value in order to increase their short-term bottom line… they are destroying the multiplier effect that a business managed for long-term stability creates. This investment class reduces costs to increase profit by means we are all too familiar with, including off-shoring (which many times involves the use of child labor and slave labor, unsafe work environments, stripping of natural resources, loss of our intellectual property, increases in our carbon footprint), firing the highest-paid (and arguably most knowledgeable employees), eliminating the R&D that built the company in the first place, etc. There is only one winner here and it is not the company or its employees or its customers. The price for this quick gain is devastating our country and our planet. Our stock market has responded to the changing rules of the game, which for most of our history rewarded ‘buy and hold’ and ‘good to great.
Today, too many businesses manage for quarterly returns to shareholders with no care for the long-term future of the company, its employees, or the environment. Activists like Robert Reich bemoan the ever-expanding distance between CEO pay and that of the average employee, without getting to the real issue. The CEOs of the largest corporations in the world are not ignorant of the fact that the rules changed and there are no golden handcuffs anymore. They are charged with making money for their shareholders and the real customers are secondary. They understand that they need to get their payoff early and with guarantees because running their company by the crony capitalism rules means that they, or the company, or both may not be around for the long term. And, Reich is also wrong that unions are a solution to this wage gap. The true solution is to allow our CEOs to run their companies to serve the best interests of their customers and their employees and not for short-term gain to shareholders. Workers will be paid more, products will not be offshored to the lowest wage countries, our IP will remain at home and drive growth and innovation and CEOs will be rewarded for stability and customer satisfaction.
If enough companies, large and small, commit to Conscious Capitalism and reject its evil twin Crony Capitalism, we can have a strong middle class and we can have a healthy planet and a more predictable economy and I think we can even aspire to such lofty goals as world peace. Capitalism is only effective as an economic model if the system that the model operates within rewards decision-making for the greater good for the present AND future generations.
And, last but not least – Conscious Capitalism is good business. companies that consistently apply the principles of conscious capitalism outperform their peers in the S&P index by 14:1 so; why not inject more consciousness into your business?