It’s impossible to claim that the pandemic has brought the nation together the same way that World War II did for that generation. But if you looked closely, you could see companies taking actions that had nothing to do with shareholder value and everything to do with helping the country.
Consider Xerox Holdings Corp., which early in the pandemic saw that it had employees with not a lot to do and diverted them to help a small ventilator company ramp up production. Companies with low-paid workers began giving out hardship raises, at least temporarily. Delta Air Lines decided, in the interest of safety, not to sell any middle seats, even though its competitors were not willing to take that financial hit. Restaurateurs set up “Go Fund Me” campaigns for their laid-off employees and asked patrons to make contributions. Some companies promised no layoffs during the pandemic and stuck to their promise.
It wasn’t all like that, of course. But for many executives, the crisis caused them to become protective of their employees in a way that hadn’t been seen in decades. A survey conducted by the Sloan Management Review showed that employees of 500 large companies rated their corporate culture better during the pandemic than at any time during the past five years. And they gave their CEOs high marks for communication and integrity.
Other events that have taken place during the pandemic—George Floyd’s death; the rise of Black Lives Matter; the November election, followed by Donald Trump’s effort to overturn the results; and finally the siege of the U.S. Capitol on January 6—have only solidified the idea that companies and their executives have a societal role to play that goes beyond making money for shareholders. CEOs acknowledged Biden’s victory before many in Congress did. They denounced the attack on the Capitol, and a number of large, important companies decided they would no longer contribute to the campaigns of Republicans who tried to subvert the election results.
“Business leaders must realize that they not only have a moral obligation but also a commercial stake in advocating for a fairer, more equitable system,” said a memo quoted by the New York Times in January. The memo was composed by members of a private advisory committee to JPMorgan Chase & Co., reporting to the CEO, Jamie Dimon. “Unless and until the core problem of inequality is addressed,” the memo continues, “all other overarching objectives and desires will remain elusive.” In an interview with the Times, Dimon said inequality wouldn’t be erased until other CEOs began advocating for policies that might be against their own short-term business interest.
It is this changing sentiment among the business class that Biden needs to encourage and take advantage of. There are plenty of things the new administration can initiate that will begin the unwinding of income inequality.
The administration could use the rebuilding of the country’s infrastructure to establish a wage level that would attract workers and force companies to pay wages that were just as good if they didn’t want to lose employees. It could offer tax incentives to companies that built factories in the U.S. It could seed green industries—as Biden has vowed to do—with the proviso that a certain percentage of the workforce be employed in the U.S.
But Biden also needs to find ways to keep business on the path it started down during the pandemic—a path that puts helping the country ahead of stock appreciation. His bully pulpit should help, but he should also look for ways to diminish the influence Wall Street has while encouraging companies to do right by their employees. He should tighten the rules governing private equity and corporate activists. And he should insist, as a matter of national security, that there be more domestic manufacturers for a whole range of products, from transistors the military relies on to, well, N95 masks.
Globalization isn’t going to end, and I’m not suggesting it should. The jobs that have been lost are most likely gone forever. Trump’s efforts to generate domestic manufacturing jobs by slapping tariffs on Chinese goods was a bust. There has to be a balance between outsourcing and maintaining a strong base of jobs for the millions of Americans who will never go to college. Given the current expansive attitude of business, I don’t think it will take much prodding to get CEOs to buy into this idea, stockholder value be damned.
As awful as the pandemic is, it is giving Biden a once-in-a-century opportunity to make good on his promise to make the economy work for everyone. As someone once said, a crisis is a terrible thing to waste.
Joe Nocera is a Bloomberg Opinion columnist covering business. He has written business columns for Esquire, GQ and the New York Times, and is the former editorial director of Fortune.