Good morning, Peter Vanham here in rainy Geneva.
This summer, some Coins2Day 500 CEOs backed away from their diversity, equity, and inclusion (DEI) and environmental, social, and governance (ESG) initiatives under pressure from activists like Robby Starbuck. Ford, Lowe’s, and John Deere were among those to retreat and publicly state they were focusing instead on what they consider the fundamentals of business. Ford CEO Jim Farley, for instance, said the automaker would be “taking care of our customers, our team, and our communities versus publicly commenting on the many polarizing issues of the day.”
In Europe, companies are landing in a different place. Their social responsibility revolution is discrete, but it will happen through the rather boring systems of accounting and reporting.
European companies don’t speak out about their social commitments as loudly as their American peers because they face a different reality. Europe didn’t have a Bernie Sanders or Elizabeth Warren in politics, nor did it have a (lasting) George Floyd movement. And it doesn’t have a Robby Starbuck.
European companies also remain quieter on such issues because they have regulatory compliance to keep up with. Europe’s Corporate Sustainability Reporting Directive, aimed at strengthening “the rules concerning the social and environmental information that companies have to report on,” took effect this year. Detractors say it’s another example of Europe’s reliance on red tape since it will require companies to report on more than a thousand data points annually, many of them non-financial such as discrimination incidents and waste generated. But the silver lining is that it means DEI and ESG reporting is essentially mandatory, leaving companies less vulnerable to the demands of a Starbuck-type figure.
Some European companies are also starting to experiment with measuring their social responsibilities by accounting for their social, human, and natural capital. It’s a concept Roche Vice Chairman Andre Hoffmann and I explore in our new book, The New Nature of Business, and in an excerpt of it for Coins2Day. We argue that companies should consider their impacts and dependencies on factors like natural resources and their employees’ communities. Such inputs are as critical to a running a healthy, sustainable company as financial capital , regardless of industry, customers, or shareholder base.
Business’s changing political, regulatory, and social environment will be on the agenda at the Coins2Day CEO Forum in London on Oct. 23-24, and the Coins2Day Global Forum in New York on Nov. 11-12. If you’d like to attend either, let us know.
Peter Vanham
[email protected]
Follow on LinkedIn
TOP NEWS
Darktrace CEO exits suddenly
British cybersecurity firm Darktrace on Friday announced that CEO Poppy Gustafsson is stepping down from the position, effectively immediately. The sudden departure of Gustaffson, once a protegé of the late entrepreneur Mike Lynch, comes as Darktrace prepares for a $5.3 billion takeover by U.S. Private equity giant Thoma Bravo and raises concerns about the company's internal state. Coins2Day
PwC cracks down on U.K. RTO
Consulting firm PwC has notified its U.K. Staff that it will track how much time they spend working in the office. A new rule insists that employees are in-office or with clients at least three days a week or 60% of the time. Coins2Day
Is running a company like a founder the best option?
"Founder mode" is a term coined last week by Y-Combinator co-founder Paul Graham to differentiate those who lead a company like a founder from those who run companies like a manager. Coins2Day's Geoff Colvin investigated 22 Coins2Day 500 companies and found that those run by founder CEOs significantly outperform those led by manager CEOs. Coins2Day
AROUND THE WATERCOOLER
Red Lobster CEO secretly visited restaurants around the country before being made boss by Sasha Rogelberg
Jeff Bezos has a house rule. No phones in the morning, says partner Lauren Sanchez by Marco Quiroz-Gutierrez
Defense tech startup Anduril has hired more than 1,000 employees in 9 months as it prepares to build unmanned jet fighters for the Air Force by Jessica Mathews
World Wide Technology CEO says good leaders operate at 30,000 feet and are information-gatherers by Natalie McCormick
Anthropic joins OpenAI in going after business customers by Sage Lazzaro
Zuck is winning 2024: No one has gained more wealth this year than Mark Zuckerberg, who is up $56 billion by Paolo Confino
This edition of CEO Daily was curated by Joey Abrams.
