[As a capitalist, I believe it’s time to say out loud what we
all know to be true: Capitalism, as we know it, is dead.]
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SALESFORCE CEO: WE NEED A NEW CAPITALISM  
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Marc Benioff
October 14, 2019
New York Times
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_ As a capitalist, I believe it’s time to say out loud what we all
know to be true: Capitalism, as we know it, is dead. _

, Brian Stauffer

 

Capitalism, I acknowledge, has been good to me.

Over the past 20 years, the company that I co-founded, Salesforce, has
generated billions in profits and made me a very wealthy person. I
have been fortunate to live a life beyond the wildest imaginations of
my great-grandfather, who immigrated to San Francisco from Kiev in the
late 1800s.

Yet, as a capitalist, I believe it’s time to say out loud what we
all know to be true: Capitalism, as we know it, is dead.

Yes, free markets — and societies that cherish scientific research
and innovation — have pioneered new industries, discovered cures
that have saved millions from disease and unleashed prosperity that
has lifted billions of people out of poverty. On a personal level, the
success that I’ve achieved has allowed me to embrace philanthropy
and invest in improving local public schools and reducing homelessness
in the San Francisco Bay Area, advancing children’s health care and
protecting our oceans.

But capitalism as it has been practiced in recent decades — with its
obsession on maximizing profits for shareholders — has also led to
horrifying inequality. Globally, the 26 richest people
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the world now have as much wealth as the poorest 3.8 billion people,
and the relentless spewing of carbon emissions is pushing the planet
toward catastrophic climate change. In the United States, income
inequality has reached its highest level in at least 50 years, with
the top 0.1 percent — people like me — owning roughly 20 percent
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the wealth while many Americans cannot afford to pay for a $400
emergency
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It’s no wonder that support for capitalism has dropped
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especially among young people.

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To my fellow business leaders and billionaires, I say that we can no
longer wash our hands of our responsibility for what people do with
our products. Yes, profits are important, but so is society. And if
our quest for greater profits leaves our world worse off than before,
all we will have taught our children is the power of greed.

It’s time for a new capitalism — a more fair, equal and
sustainable capitalism that actually works for everyone and where
businesses, including tech companies, don’t just take from society
but truly give back and have a positive impact.

What might a new capitalism look like?

First, business leaders need to embrace a broader vision of their
responsibilities by looking beyond shareholder return and also
measuring their stakeholder return. This requires that they focus not
only on their shareholders, but also on all of their stakeholders —
their employees, customers, communities and the planet. Fortunately,
nearly 200 executives with the Business Roundtable recently committed
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companies, including Salesforce, to this approach, saying that the
“purpose of a corporation” includes “a fundamental commitment to
all of our stakeholders.” As a next step, the government could
formalize this commitment, perhaps with the Security and Exchange
Commission requiring public companies to publicly disclose their key
stakeholders and show how they are impacting those stakeholders.

Unfortunately, not everyone agrees. Some business leaders objected
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the landmark declaration. The Council of Institutional
Investors argued [[link removed]] that “it
is government, not companies, that should shoulder the responsibility
of defining and addressing societal objectives.” When asked whether
companies should serve all stakeholders and whether capitalism should
be updated, Vice President Mike Pence warned
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“leftist policies.”

But suggesting that companies must choose between doing well and doing
good is a false choice. Successful businesses can and must do both. In
fact, with political dysfunction in Washington, D.C.,
Americans overwhelmingly say
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lead on economic and social challenges, and employees, investors and
customers increasingly seek out
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that share their values.When government is unable or unwilling to act,
business should not wait. Our experience at Salesforce shows that
profit and purpose go hand in hand and that business can be the
greatest platform for change.

Legislation to close loopholes in the Equal Pay Act have stalled in
Congress for years, and today women still only make about 80 cents, on
average, for every dollar earned by men. But congressional inaction
does not absolve companies from their responsibility. Since learning
that we were paying women less than men for equal work at Salesforce,
we have spent $10.3 million
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ensure equal pay; today we conduct annual audits to ensure that pay
remains equal. Just about every company, I suspect, has a pay gap —
and every company can close it now.

For many businesses, giving back to their communities is an
afterthought — something they only do after they’ve turned a
profit. But by integrating philanthropy into our company culture from
the beginning — giving 1 percent of our equity, time and technology
— Salesforce has donated nearly $300 million
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worthy causes, including local public schools and addressing
homelessness. To me, the boys and girls in local schools and homeless
families on the streets of our city are our stakeholders, too.
Entrepreneurs looking to develop great products and develop their
communities can join the 9,000 companies in the Pledge 1%
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percent of their equity, time and product, starting on their first day
of business.

Nationally, despite massive breaches of consumer information,
lawmakers in Washington seem unable
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pass a national privacy law. California and other states are moving
ahead with their own laws, forcing consumers and companies to navigate
a patchwork of different regulations. Rather than instinctively
opposing new regulations, tech leaders should support a strong,
comprehensive national privacy law
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perhaps modeled on the European Union’s General Data Protection
Regulation — and recognize that protecting privacy and upholding
trust is ultimately good for business.

Globally, few nations are meeting their targets
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fight climate change, the current United States presidential
administration remains determined to withdraw from the Paris Agreement
and global emissions continue to rise
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As governments fiddle, there are steps that business can take now,
while there’s still time, to prevent the global temperature from
rising more than 1.5 degrees Celsius. Every company can do something,
whether reducing emissions in their operations and across
their sector
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striving for net-zero emissions
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Salesforce, moving toward renewable energies or aligning their
operation
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and supply chains with emissions reduction targets.

Skeptical business leaders who say that having a purpose beyond profit
hurts the bottom line should look at the facts. Research
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that companies that embrace a broader mission — and, importantly,
integrate that purpose into their corporate culture — outperform
their peers, grow faster, and deliver higher profits. Salesforce is
living proof that new capitalism can thrive and everyone can benefit.
We don’t have to choose between doing well and doing good. They’re
not mutually exclusive. In fact, since becoming a public company in
2004, Salesforce has delivered a 3,500 percent return to our
shareholders. Values create value.

Of course, C.E.O. activism and corporate philanthropy alone will never
be enough to meet the immense scale of today’s challenges. It could
take $23 billion [[link removed]] a year
to address racial inequalities in our public schools. College
graduates are drowning in $1.6 trillion
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student debt. It will cost billions
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retrain American workers for the digital jobs of the
future. Trillions
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dollars of investments will be needed to avert the worst effects of
climate change. All this, when our budget deficit
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already surpassed $1 trillion.

How, exactly, is our country going to pay for all this?

That is why a new capitalism must also include a tax system that
generates the resources we need and includes higher taxes on the
wealthiest among us. Local efforts — like the tax I supported last
year
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San Francisco’s largest companies to address our city’s urgent
homelessness crisis — will help. Nationally, increasing taxes on
high-income individuals like myself would help generate the trillions
of dollars that we desperately need to improve education and health
care and fight climate change.

The culture of corporate America needs to change, and it shouldn’t
take an act of Congress to do it. Every C.E.O. and every company must
recognize that their responsibilities do not stop at the edge of the
corporate campus. When we finally start focusing on stakeholder value
as well as shareholder value, our companies will be more successful,
our communities will be more equal, our societies will be more just
and our planet will be healthier.

_Marc Benioff is the chairman and co-chief executive of Salesforce and
the author, with Monica Langley, of the forthcoming book,
“Trailblazer: The Power of Business as the Greatest Platform for
Change
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