I’m thankful ‘stakeholder capitalism’ is fading

Bringing the Christian ethos into the business world through CRT

It’s Thanksgiving! Time to give thanks.

I am grateful for starting the Culture, Religion & Technology podcast this year, and hosting what had to be one of the best faith-filled CRT events since we started in 2021. The CRT 2025 event was held at Mar-a-Lago, where we raised $25,000 for Charlie Kirk’s mission. This was made possible because of generous sponsors, such as Palantir. The event was sold out within 10 days but had we kept registration going, we could have increased attendance by 25% at least.

After giving the opening prayer glorifying God at what has technically been considered a tech conference, given the makeup of speakers, I was emboldened to see how many people felt that conversations about faith and conservative values were needed at conferences that heretofore expected people to check their faith and politics at the door.

Ironically, one of the biggest business and tech conferences in the world - the World Economic Forum (WEF) - has been pushing the adoption of its religion under the guise of “stakeholder capitalism” - a code of ethics for business leaders to encourage companies to serve clients, employees, and society at large, along with the secondary pursuit of profits.

When first introduced in Klaus Schwab’s 1973 essay titled the: Davos Manifesto, the principles appeared well intentioned, like a company’s cultural mission statement. Over the last 50 years, however, the ethos had evolved into a necessary moral framework to shape society through the pursuit of shared goals.

For Schwab, the founder of the WEF, a couple of those shared goals have been “those outlined in the Paris climate agreement and the United Nations Sustainable Development Agenda,” he wrote in 2019, in a post titled: “Why we need the Davos Manifesto for a better kind of capitalism.” Schwab also believed corporations were obligated to steward inequities in society. “Citizens no longer see companies merely as economic entities,” he wrote. “They expect businesses to address societal challenges such as inequality, ecological sustainability and community well-being,” he wrote in his essay: What stakeholder capitalism is and what it isn’t.

The need for metrics to identify who’s good

To uphold such stakeholder ethos, “companies will need new metrics,” Schwab wrote in that 2019 essay. “For starters, a new measure of ‘shared value creation’ should include “environmental, social and governance” (ESG) goals as a complement to standard financial metrics.”

Metrics were integral to Schwab’s insistence on a systemic approach. As he put it in a 2022 report: “if we really want to improve the State of the World, we must take a systemic approach.”

A systemic approach invariably changes culture because metrics don’t just measure actions and behavior, they direct how one is to act.

For example, in the metric called “Government body composition,” in a Measuring Stakeholder Capitalism 2020 white paper, the makeup of a company board is measured. If a higher ratio of women representation on a company board is ranked higher than an all-male board on that metric, then accommodating more women on boards becomes approved behavior as it aligns with the shared value system of the collective. And that ranking system of values, with the highest ranking equivalent to good, defines the moral structure of this metric system. The WEF also includes diversity across race and ethnicity as other indicators that companies can use to show they’re behaving in ways that align with the common moral good.

It’s easy to see why metrics became a necessity. The corporate culture that emerged in the 20th century and is now systemic in the 21st is a reliance on scientific, data-driven, evidence-based processes to determine the value, efficacy and credibility of a product, procedure, or program. If the Davos’ ethos to serve employees, partners and society was to take root as a groundbreaking evidence-based philosophy in the modern age, it had to be served up as a process that complied with scientific rigor.

Without metrics, stakeholder capitalism would just be feel-good rhetoric. The list of values would just be part of a cultural mission statement for individuals to willfully practice. In other words, they wouldn’t be enforced.

In the end, these metrics did not only provide an organized process or systematic process to achieve shared goals, they created a systemic hierarchy of moral values - a religion - sold as a multi-stakeholder governance and corporate practice.

So bought into this religion… err practice that corporate America poured trillions into following it. Global sustainable investing topped $30 trillion in 2022 and the rating systems to monitor company’s alignment or adherence to the metrics, which include ESG, became big business with the creation of about 140 ESG data providers and more than 600-800 ESG rating agencies, including Sustainalytics, Bloomberg, and Moody’s.

But over the last five years as Schwab doubled down on stakeholder capitalism, he was met with backlash as many critics became vocal, accusing the WEF of social engineering through corporate America. Books such as Woke Inc by Vivek Ramaswamy also revealed the business strategy as ideological activism. Eventually, some states even passed laws restricting ESG investing.

This year, Schwab told his staff that he would be stepping down after the WEF began an investigation into financial misconduct and sexual harassment in the workplace. The probe found no evidence of material wrongdoing, but it still exposed an organization and culture that illustrated the age-old aphorism: power tends to corrupt.

For Christians, serving in the corporate setting doesn’t mean aligning with man-made metrics that determine what is “good” for society.

Serving in corporate America means upholding the 10 Commandments along with other virtues the Bible lays out. In the 10 commandments, we’re told not to steal or bear false witness. In Ecclesiastes 9:10 it says, “whatever your hand finds to do, do it with your might.” In Psalms 112:5, it says “Good will come to those who are generous and lend freely, who conduct their affairs with justice.” Numbers 35:33 says “You shall not pollute the land in which you live.” And, it says in Matthew 25:20-21, we are to invest our “talents” and deliver exponential profits. To sum up: We’re told to be honest and not to lie; work hard and not be lazy; to be generous and act just; to care for our surroundings; to take risks and be productive with the resources and responsibilities we are given.

Christians don’t need superficial metrics around a so-called shared value system to measure whether someone is good, especially if those shared values were created by a few men. Schwab saw the need for a new social contract, much like Jean-Jacques Rousseau, an Enlightenment era philosopher, who argued that good should be based on the “general will” of society vs God’s will. That general will, of course, is tough to measure and enforce despite the trillions of dollars and millions of people who tried to “will” it.

Therefore this Thanksgiving, I’m thankful that this man-made religion embedded in corporate America is fading. As for me, I plan to always open up my CRT events with a prayer. We are all religious. It’s just that I’m not calling mine a corporate practice.

(Image source: hbr.org)