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Friday feedback: Stakeholder capitalism vs. socialism

February 18, 2022, 11:32 AM UTC

Good morning.

It’s Friday, so some feedback. Many responses to my Wednesday column about Hamdi Ulukaya and stakeholder capitalism. Here’s a comment from S.O.:

Wonderful column on Hamdi Ulukaya this morning. My husband is from upstate NY and you can’t imagine what a beacon of hope Hamdi represented for so many forgotten workers from that industrial wasteland.“

But B.T. took a different tack:

“The more I read your newsletter, the more I am concerned that you are actually advocating for Marxist-socialist-wokist-hyper-regulation and control.”

My response to B.T. is that we should define our terms. Socialism refers to government ownership of the means of production, and as someone who spent most of my career covering Washington, I know better than to have any sympathy for that approach. If it is “woke” to call on business to pay attention to its effects on people, communities, and the environment, then call me “woke.” As for “hyper-regulation,” I believe the best way to avoid it is for business to do a better job modulating its own behavior.

More news below. And thanks to all those who sent their congratulations on the book. I encourage you to preorder it here.

Alan Murray
@alansmurray

alan.murray@fortune.com

Editor’s note: CEO Daily will be taking a break on Monday for Presidents’ Day in the U.S.

TOP NEWS

Cook pay

Shareholder advisory firm ISS recommends that Apple shareholders reject CEO Tim Cook’s pay package, which comes in at $99 million, or around 1,400 times the salary of the average Apple worker. However, rival adviser Glass Lewis is fine with the package. Fortune

Musk speech

Tesla claims the SEC is trying to “chill” CEO Elon Musk’s speech by complaining about his tweets, specifically the ones that announce or foreshadow major corporate decisions. Tesla lawyer Alex Spiro: “The SEC seems to be targeting Mr. Musk and Tesla for unrelenting investigation largely because Mr. Musk remains an outspoken critic of the government.” In other news, Musk has mysteriously deleted a tweet in which he compared Canadian Prime Minister Justin Trudeau to Adolf Hitler. (And in a bonus read related to that episode, turns out Silicon Valley billionaire Tom Siebel is one of the biggest single donors to the Canadian “Freedom Convoy” of which Musk is an admirer.) Fortune

Masked faces

iPhone users will finally be able to unlock their phones using Face ID while wearing masks (of the anti-COVID rather than Halloween variety). The updated feature will land next month. Fortune

Home prices

Average U.S. home prices are up 27% since January 2020, and top forecaster Ed Pinto (of the American Enterprise Institute’s Housing Center) sees a further 12% rise coming this year. Why? Relatively low interest rates, low inventory, and “the great arbitrage.” Fortune

AROUND THE WATERCOOLER

Android privacy

Google’s big privacy announcement about Android phones is kinda murky, writes Fortune’s Jacob Carpenter: “While the Alphabet unit made waves Wednesday with its promise of Android operating system privacy tweaks in the coming years, following in the footsteps of Apple and its iOS privacy updates last year, it’s not yet remotely clear how the changes will impact users, advertisers, and Google itself.” Fortune

Index funds

Charlie Munger, who has been opining a lot this week, thinks passive investment funds will “change the world” in a bad way, because the fund managers get too powerful. Munger: “We have a new bunch of emperors, and they’re the people who vote the shares in the index funds. I think the world of [BlackRock CEO and stakeholder capitalism advocate] Larry Fink, but I’m not sure I want him to be my emperor.” Wall Street Journal

Labor shortage

Bob Moore, the 93-year-old cofounder of Oregon-based whole-grain foods manufacturer Bob’s Red Mill, is a strong advocate of employee-owned companies—his is entirely owned by its workers. Here he is on why more firms don’t have employee stock ownership plans, or ESOPs: “Companies could do this, but because money is the only factor, and the owners and managers are generally looking out only for their own benefit, and what the company can do for them, I’m not so sure everyone cares to do that.” Fortune

Luxury demand

Kering’s stellar results demonstrate how the luxury sector is fairly insulated from inflation’s negative effects, explains Fortune’s Sophie Mellor: “As the cost of everything from energy to raw textiles rises, the prices of high-end bags, shoes, and jackets rise, too. But while the demand for mass-produced goods can drop as the middle class grows more financially insecure, the demand for luxury remains relatively inelastic.” Fortune

This edition of CEO Daily was edited by David Meyer.

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