September 17, 2020

Senator Warren to Business Roundtable: Your 2019 Commitment to 'Promote an Economy that Serves all Americans' Was an Empty Publicity Stunt

A year later and during an economic crisis, CEOs failing to deliver on the Roundtable's commitment to serve all "stakeholders, including workers" Warren urges CEOs to reconsider hostility to her Accountable Capitalism Act and act on their stated principles; Seeks accountability via public reporting

Letter to Business Roundtable (PDF) 

Washington, DC - United States States Elizabeth Warren (D-Mass.) wrote to Jamie Dimon and Doug McMillon, former and current board chairs of the Business Roundtable (BRT), criticizing them and other BRT member CEOs for their failure to honor commitments from BRT's 2019 Statement on the Purpose of a Corporation. The statement reversed BRT's 23-year-old position that "corporations exist principally to serve shareholders," instead stating that corporations "share a fundamental commitment to all of (their) stakeholders," including workers, customers, and the communities in which they operate. One year after the new statement was released, Senator Warren is raising concerns that corporate CEOs have not kept these commitments and instead have been lobbying for their narrow, short-term interests rather than the broad group of stakeholders they claimed they would serve. 

Senator Warren urged BRT to fully commit to the principles they set out in the 2019 statement, act on them, and publicly report on their progress in the coming year. She also called on them to reconsider their hostility to the common-sense reforms proposed in her Accountable Capitalism Act

"Rebuilding our economy so that workers, customers, and communities are able to share in prosperity requires real change in the way decisions are made in corporate headquarters and on Wall Street, not just the vague, empty-worded press releases that you have issued thus far," wrote Senator Warren

Even amid global public health and economic crises, BRT, the signers of the Statement, and other corporate executives have not operationalized their commitments to workers and communities. Amid the ongoing economic collapse, "the first wave of corporate responses"- such as hazard pay, special customer benefits, and pauses on payments or foreclosures - "seems to have dwindled much faster than the disease itself," as corporations rolled back these benefits. And because the pandemic and its associated economic collapse have uniquely hurt communities of color, the cutbacks for essential workers further exacerbated economic and health inequities.

In her letter, Senator Warren noted that although almost  every major company has publicly condemned racism, many of these same companies have contributed to systemic inequality, targeted the Black community with unhealthy products and services, and failed to hire, promote and fairly compensate Black men and women. Senator Warren asked the BRT's corporate members to document and publicly report how they are working to end their contributions to racial inequality.

Last year, when the BRT made a splashy public announcement with their new Statement, Senator Warren asked ten of the BRT CEOs for tangible steps they planned to implement the BRT principles and also asked whether each CEO would take the steps laid out in her Accountable Capitalism Act. Most of them refused to answer her questions. The companies that did respond - BP and Amazon - offered little evidence they had thought about, much less implemented, changes consistent with the BRT Statement. Jamie Dimon notably refused to answer the inquiry and explain what he was doing to implement the reforms he touted in his capacity as head of BRT at JPMorgan Chase. Doug McMillion, Walmart's CEO, did not answer at all. 

Senator Warren first introduced the Accountable Capitalism Act in August 2018 to reverse the harmful corporate trends over the last thirty years that have produced record corporate profits for American companies but stagnant wages for American workers. Later in 2018, her legislation gained momentum in the U.S. House of Representatives as Rep. Luján, then-incoming Assistant Democratic Leader; Representative Mark Pocan (D-Wis.), co-chair of the Congressional Progressive Caucus; Representative Stephen Lynch (D-Mass.); Representative Brendan Boyle (D-Pa.); and Representative Jan Schakowsky (D-Ill.) introduced companion legislation.