A couple of years ago I thought that in the 21st century some corporations would be obliged to change some of their ways primarily because of shareholder activism. Now I’m not so sure. Now there is growing evidence that while in some cases shareholder activists have an impact – they are, for instance, big on the issue of executive pay – there is scant evidence that they shape corporate policies.
The same cannot be said about ordinary people who increasingly employ social media to mount collective campaigns against corporate policies of which they strongly disapprove. By and large these policies pertain to issues whose time has in some indefinable, but indisputable way come.
Two significant cases in point, just in the last week.
First, Stanford University, bowing to pressure from students around the country intent on getting their institutions to stop investing in the most egregious of fossil fuels, agreed to stop putting any of its multi-billion dollar endowment into coal mining companies. In response to recommendations from a panel consisting of students, faculty, staff, and alumni, Stanford’s board of trustees agreed that investments in alternatives to coal would be less harmful to the environment. As Stanford’s President John Hennessy put it: “The University’s review has concluded that coal is one of the most carbon-intensive methods of energy generation and that other sources can be readily substituted for it.”
What’s new here of course is not the conclusion. We have known for some time that coal is “one of the most carbon-intensive methods of energy generation.” But what we did not have before is an organized movement, led by students, protesting against universities that continue to invest in coal mining companies.
Second is the case of Portland, Oregon, which a few days ago announced that it had begun to divest itself of its holdings in Walmart. Why? Because as one city official put it, “We as a city talk a lot about our progressive values. We care about working people, we care about the environment, we care about human health – and money talks. We don’t want our money to be saying things that are at cross purposes with values we profess every day.”
Again, Walmart did not just yesterday develop a reputation for treating its workers with minimal care and concern. And it did not just yesterday begin to pay its workers less than a living wage. But what has happened in the last year is that the issue of income inequity – the issue of a growing gap between them that has too much and them that has too little – has become more resonant.
None of this is to say that we have reached a tipping point, either on the environment or inequity. Rather it is to point out that there are some signs of change – and that the way change is being created is less real than virtual.