Good morning.
Johnson & Johnson executive chairman Alex Gorsky met virtually yesterday with more than 100 Fortune Connect Fellows who are taking part in a four-week “learning sprint” on leading in a world of stakeholder capitalism. Gorsky drove the effort at the Business Roundtable to develop a new statement on the purpose of a corporation in August 2019, which was seen by many as heralding the shift to stakeholder capitalism.
Yesterday’s session was off the record, meant solely for the benefit of Connect Fellows. But Gorsky’s comments were so compelling that I asked if he would let me share them with CEO Daily readers. A few excerpts here:
“By and large, business is thinking, acting, doing things differently as a result of that [Business Roundtable] statement.”
“In today’s world, if you aren’t thinking more broadly about these issues of strategy and stakeholders, you are going to be severely challenged.”
“This is an and-and proposition. If a company only takes stands, but doesn’t also deliver on financial commitments, and isn’t disciplined in the way it manages business, it will not have credibility. It will lose its voice. However, done right, when you are able to achieve all of these goals, it then becomes a flywheel, a self-sustaining flywheel, that enables that kind of long-term performance for generations.”
“When companies can create an environment where employees feel like they are part of something bigger than themselves…where one plus one plus one equals five…it is absolutely a secret sauce.”
“I knew by the time I was in sixth grade I wanted to go to West Point. And the opportunity to go through that challenge, to learn a lot about myself but more importantly to serve my country, has been seminal in my development as a leader…When I went into my first unit in the Army, I was [in the] minority. And I had people from across a very broad range of socioeconomic and ethnic backgrounds, and there was no way I could be successful as a young lieutenant if I didn’t connect with them at an emotional, personal, psychological level. You really come to appreciate our common humanity.”
“With all the dynamics going on in the world today, I would challenge everybody on this Zoom to think about the important role that industry and business in a free-market, capitalist-based system can have for this society…I mean you think about so many of the challenges we face, be it geopolitics, be it around climate, be it politics…I truly believe one of our greatest hopes, and what we are seeing more and more is, how does business engage in the appropriate way so that we can actually have more successful, more inclusive outcomes that help us navigate through some of these very issues.”
If you are interested in learning more about Fortune Connect, Fortune’s learning community for the next generation of business leaders, go here. Other news below.
Alan Murray
@alansmurray
alan.murray@fortune.com
TOP NEWS
Gun control
The CEOs of over 200 U.S. companies have demanded that Senate Republicans allow the passage of gun-control legislation. Their letter did not spell out specific solutions to the American gun-death crisis, but they noted that mass shootings affect their employees, customers, and communities, adding that “on top of the human toll is a profound economic impact” to the tune of $280 billion a year. (Bonus read: the Firearms Accountability Counsel Taskforce’s Brad S. Karp and H. Christopher Boehning on “the gun industry’s deadly lie.”) Fortune
Shanghai lockdown
Half of Shanghai’s being locked down again, mere days after the last socially and economically catastrophic lockdown concluded. The move follows the detection of 11 coronavirus infections; President Xi Jinping, who faces “reelection” later this year, seems determined to maintain his zero-COVID policy. Financial Times
Eurozone rates
The European Central Bank has announced its first rate hike in over a decade: 25 basis points in July. A similar or larger bump will come in September, with the size depending on how inflation is looking. ECB President Christine Lagarde: “Based on our current assessment, we anticipate that a gradual but sustained path of further increases in interest rates will be appropriate.” (Bonus read: Janet Yellen does not believe corporate greed is to blame for U.S. inflation.) Euronews
Wells Fargo probe
The Manhattan U.S. attorney’s office is investigating Wells Fargo for allegedly conducting fake job interviews of minority candidates, to massage its diversity stats. Fortune
AROUND THE WATERCOOLER
Facebook News
Meta has been paying large news organizations millions to carry their content paywall-free on Facebook News, but now it’s reportedly reexamining its commitments on that front, as it instead tries to invest in attracting “creators” to help it compete with TikTok. Wall Street Journal
Housing contraction
“The U.S. housing market is at the beginning stages of the most significant contraction in activity since 2006,” Freddie Mac deputy chief economist Len Kiefer has warned. “It hasn’t shown up in many data series yet, but mortgage applications are pointing to a large decline over summer.” Fortune
BYD boom
China’s Warren Buffett–backed BYD has overtaken Volkswagen to become the world’s third most valuable carmaker, after Tesla and Toyota. It’s just unveiled a buyback plan, which analysts see as reflecting BYD’s confidence in its future. South China Morning Post
Imagine there’s no border
Yandex—Russia’s Google rival—has removed national borders from its maps app. The company claims this is because it’s trying to focus on local navigation and “physical-geographical” features such as rivers and mountains, but TechCrunch reports it’s really about avoiding pressure from the Kremlin to redraw Russia’s borders as the country tries to take chunks out of its neighbors. TechCrunch
This edition of CEO Daily was edited by David Meyer.
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