The Performance of Action Becomes the Action
The chief executives still await your thanks. (Part Two)
This morning, The American Prospect published my latest story: “A Ponzi Scheme of Promises.”
The story reviews the efforts taken (and not taken) by the Business Roundtable and its CEO members following the release of the group’s headline-grabbing “purpose of the corporation” statement five years ago:
On August 19, 2019, the Business Roundtable issued a press release containing a roughly 300-word statement, signed by 181 of its members. “Business Roundtable Redefines the Purpose of a Corporation to Promote ‘An Economy That Serves All Americans,’” its headline read, citing a quote from its chair, [JPMorgan Chase CEO] Jamie Dimon.
The CEOs pledged to “lead their companies for the benefit of all stakeholders—customers, employees, suppliers, communities and shareholders,” and “move away from shareholder primacy.” The CEOs added, “Each of our stakeholders is essential. We commit to deliver value to all of them, for the future success of our companies, our communities and our country.”
No details were offered about what, exactly, their companies would do differently. Nor did the executives—a cohort notoriously obsessed with numbers and metrics—include any specific or binding commitments to which they could be held accountable for their promises to all of their “stakeholders.”
In public relations terms, though, the statement was deemed as historic as the Declaration of Independence. “There were times when I felt like Thomas Jefferson,” Alex Gorsky, then the head of Johnson & Johnson and the Business Roundtable member who led the drafting of the statement, told The New York Times, which placed the news on the front page. […]
A new narrative quickly began to solidify: Milton Friedman’s profits-at-all-costs way of thinking was dead. In fact, Fortune wrote in its cover story that “Friedman must be turning in his grave.”
There was just one catch: CEOs weren’t actually promising a new way of doing business, but simply a new way of talking about doing business.
This is a long story, and one I’ve been working on for a long time. I can’t capture the whole thing in this newsletter—that’s what the story is for—but I want to highlight one argument that I attempt to make toward the end:
Signing a bold-sounding statement, conveniently devoid of specific benchmarks or binding commitments, deflected public scrutiny by giving executives something to point to when pressured or challenged by activists, employees, or other “stakeholders.”
If asked to prove that they were following through on a commitment or pledge, they could simply issue another one. It was a Ponzi scheme of promises.
A lot of the reporting and writing that I’ve done over the past few years has been in service of trying to articulate this idea: how, in today’s news and information environment, it’s easier than ever for someone (like a politician or an executive), or something (like a political party or a corporation), to substitute talking about doing something for actually doing the thing.
Another way I’ve described it is that the performance of the action becomes the action. The performance of taking action on climate change becomes the only “action” that a company takes to reduce its carbon emissions. The performance of taking action on income inequality becomes the only “action” that a politician takes in pursuit of raising the minimum wage or making multinational corporations pay their taxes.1
These performances are more compelling and nuanced and insidious than rank hypocrisy or outright lies, not least because the performers can convince themselves, in addition to all of us, that the performance is real.
Moreover, as this story shows, our media environment routinely rewards high-profile pronouncements with the same level of coverage and eye-catching headlines as meaningful action—an arrangement that hardly encourages actual action, which tends to be complicated and difficult and uncomfortable and expensive and slow.
Perhaps most fundamentally, however, actual action usually requires shifting power from those who have a lot of it to those who have less of it. Press releases and feel-good promises keep existing power imbalances comfortably intact.
The outcome of this theatrical ecosystem is that everyone—again, sometimes including the performers themselves—ends up gaslit into thinking that, surely, something must have changed. That makes actually changing things even harder.
Anyway, I’m not sure this idea comes through in the story, but it’s the closest I’ve come to articulating it so far. You can read the full story here: “A Ponzi Scheme of Promises.”
Huge thanks to David Dayen and the team at the Prospect for editing the story and giving it a home, and to Jon Krause for the fantastic illustration. Thanks as well to Farley Chase of Chase Literary Agency for helping develop the concept of “CEO tyranny” and craft the book proposal from which this story emerged, and to each of the sources, named and not named, who spoke with me for this story.
If you’d rather read the story in analog format, it will be in the Prospect’s October print issue, which you can get here. (This is a great time to support independent journalism!)
One final thing: More than a few readers of this newsletter have helped me shape the arguments in this story. You know who you are, and you should know that I appreciate you!
Similarly, the performance of opening tabs and jotting down lots of to-dos and getting really stressed about an article all too often become the only “action” that I take on writing a story.