Category: Commentary

As we start a new year with the legislature pondering how best to spend $17.6 billion in unallocated public monies, we might also think of what investments in social and human capitals come without great financial cost.

Along with my role at the Caux Round Table, I’m also the chair of the Minnesota Character Council (MCC).  The members of the MCC have drafted this statement on Minnesota’s hope – our children.  Investing in the emotional health and character development of children doesn’t cost much money, but it does cost us in taking time and making sure we care.

We ask that you consider sharing this statement with your networks and colleagues.

Please also let me know if you would like to help us get the message of care out and letting our kids know that they matter in all kinds of important ways.

We have been thinking a bit more, perhaps belatedly, but better late than never, it has been said, about systems and individuals.  One might argue that a casualty of modernity has been charisma – the compelling dynamic of individuals to lead, bring communities to excellence, to heal and to inspire.  We live under the ministrations of great organizations – bureaucracies, hierarchies, peer pressure – encased in our roles, confined by rational/legal criteria of justice, subordinated to celebrity and the alure of going along to be paid for conformity with money, status or power.

Many seem to have given up on the possibility of individual greatness.  Academically, I have been trained in systems theory – the social system; the political system; the economic system; the self-system; etc.

Who can act?  Who is willing to act?

We speak of moral capitalism, but where are the moral capitalists?

Here in Minnesota, we have started an annual recognition award for individuals.  We call it the Dayton Award, in honor of the Dayton family here which, for four generations, has given to society individuals who are willing to act for the common good.

Our colleagues in Mexico, for many years now, give annual awards (a distintivo) to companies which have achieved under their leaderships.

The Caux Round Table will present Dayton Awards for 2022 to Mary Anne Kowalski, owner of Kowalski’s Markets, Kris Kowalski Christiansen, CEO of Kowalski’s Markets and Kyle Smith, CEO of Reell Precision Manufacturing.

Our board of directors has established the criteria for selection of an award recipient as:

-CEO of a Minnesota company or similar operational organization.
-Revenue and profits if relevant to mission.
-Community impact if relevant to mission.
-Demonstrated innovation/response to market opportunities.
-Quality of company culture.
-Care of employees.
-Customer satisfaction.
-Environmental stewardship.
-Personal community commitment.
-Company community commitment.
-Vision and prudence: level 5 leadership traits (Jim Collin’s book, Good to Great)

We seek to recognize leadership, not position.  In fact, small and family-owned companies contribute more to the quality of our lives than do large corporations.  Small businesses constitute 99% of all American companies and employ 47% of working Americans.  We have also found that small and family-owned companies are more in touch with their stakeholders than are large corporations, which tend, on the whole, to favor shareholders.  The companies that made Minnesota prosperous with a high quality of life, honest and dedicated public officials and dynamic civil society nonprofits started as family-owned or small companies.

It is the intangible of leadership that counts most for moral success.

There are essential abilities required to lead – integrity, courage, compassion, respect and responsibility:

Integrity is being honest and having strong moral principles.  Having integrity means you are true to yourself and would do nothing that demeans or dishonors you.  Integrity makes you believable, as you know and act on your values.

Courage is strength in the face of adversity and upholding what is right, regardless of what others may think or do.  Courage enables you to take a stand, honor commitments and guide the way.  Courage is a necessary element of responsibility.

Compassion is having concern for another.  It is feeling for and not feeling with the other.  Compassion is concern of others in a more global sense.

Respect is a feeling of deep admiration for someone.  Leaders ought to be respected and they ought to respect those with whom they work.  Demonstrating this perspective is essential to motivate and inspire others.

Responsibility is acting on commitment, will, determination and obligation.  Responsibility implies the satisfactory performance of duties, the adequate discharge of obligations and the trustworthy care for or disposition of possessions.  It is being willing and able to act in a life-enhancing manner.  Responsibility is expected of self, as well as from others.

The nomination of Kyle Smith reported that:

I have never met an individual with more integrity than Kyle Smith.  He holds himself to such a high standard of integrity, beyond what most of us even think about.  He is intentional about everything he does, in business and his personal life.  He is honest and extremely trustworthy.  He knows what he believes and why he believes it and his values are his compass.  He is a humble, servant leader.  Kyle faces into hard decisions.  Many courageous decisions have been made.  In 2009, Reell’s revenue was cut in half.  Kyle became CEO and led the way to greater profitability.  The share price has since grown over 700%.  When he joined the company, the bankers were calling us every day and now we are healthy and debt-free!  Kyle knows the names of every coworker.  His door is always open for anyone to talk about life or work.

The nomination of Mary and Kris Kowalski Christiansen, owners of a family business, reported that:

Mary and Kris became excellent teachers of civic responsibility and the qualities needed to create wealth. They understand wealth as excellence, of which profits are the by-product.  They established a vision, expressed in their mission statement which was developed by “store citizens” and printed on their grocery bags – “Kowalski’s is a Civic Business.”  This is a statement of Kowalski’s continuing commitment to the principles of moral capitalism and citizenship, defined in the company’s educational opportunities for all employees, in the care shown to all stakeholders and in the inclusiveness of the Kowalski mindset regarding their reciprocal duty with the larger community.       

In 1991, Charles Denny, then the CEO of ADC Telecommunications, chaired a presentation by Ryuzaburo Kaku, then Chairman of Canon Inc.  Mr. Kaku spoke of the Japanese business ethic of kyosei or symbiosis, whereby each company thrives due to reciprocal engagement with its stakeholders.  Inspired by Mr. Kaku’s approach, which they found very similar to their own value-based understanding of successful business enterprise, several Minnesotans, including Chuck Denny and Tony Anderson, then CEO of H.B. Fuller, decided to present a set of ethical principles to the Caux Round Table, which met in Caux, Switzerland.  Those principles had been worked out by a group here in Minnesota, including Bob MacGregor and Professor Kenneth Goodpaster of the University of St. Thomas.

The ceremony will be held in April.

After commenting on free speech as a public good in the U.S., I was taken by Jordan Peterson’s defense of the value of free speech for Canadians.

I attach his commentary in the National Post here.

With recent comments on the virtue signaling of wealthy participants in the World Economic Forum meeting in Davos, I thought of going back to a commentary of mine from April two years ago.  I was reacting to “wokeness” as a long-hoped for awakening of moral sentiments that would “transform” capitalism into goodness and well-being for all.

Then, I was not convinced that “wokeness” would do any good at all.  I wrote:

For the Caux Round Table, the germane question has thus become: should wokeness be integrated into moral capitalism?

I have been thinking about this for some months now.  I wrote a first draft of this commentary on Christmas Day, 2020.  My considered answer is that, no, wokeness cannot be aligned with moral capitalism.

One of the carols I was listening to that day asserts: “God today has poor folk raised and cast adown the proud.”

Wokeness is a prideful, moralizing narrative about good and evil.  Like many narratives, first and foremost it serves the interests of the narrator.  In a sense, it hews to that peculiar American Calvinist tradition of the Jeremiad – prophetic voices predicting doom for sinners and salvations for true believers.  As in the Old Testament, revered by early Calvinists, prophets are tellers of narratives.  They spin a story of walking in God’s ways and never straying from his purposes, with woe to befall all those who fall short of his righteous demands.

Back in 2021, my conclusion, drawing on the political philosophy of the influential Jean-Jacques Rousseau, was:

For long term stability, any governing class needs its ideology, its narrative, to be accepted by the governed.  And so, for the future of the U.S., we must determine whether the woke narrative is credible or whether it is just another Rousseauist general will, a tale told by some narrator.  Whether it proceeds from the moral sense or from somewhere else in the human repertoire of social intermediations?

Last November, a senior executive at a successful American corporation, Jennifer Sey, published a book on her experience with “wokeness” and her resulting disdain for moralizing and canceling others.

In an excerpt from her book, published in the New York Post, she wrote:

“Woke capitalism” is corporate America’s attempt to profit off Millennial and Gen Z activism, often passive keyboard activism.  It exploits social-justice politics and transforms it into social-justice consumerism — and ultimately, investor profit.  Companies purporting to care about “progressive values” are really doing nothing more than striking a superficial pose meant to signal virtue while distracting from any company’s true motive: financial gain for shareholders.

You can read the full excerpt here.

I think we can be more seriously and prudentially just than mere “wokeness” can ever provide.  Moral capitalism can only make sense if it is grounded in the fullness of reality.  Self-serving personal narratives just don’t cut it when it comes to achieving social justice.

As you may recall, the Caux Round Table provided its good offices to facilitate a study of covenants made by the Prophet Muhammad to respect and protect Christian communities.

By the terms of two covenants, the good faith promises made to respect Christians are binding on Muslims “until the end of time.”

The covenant with the Christians of Najran (in southwestern Saudi Arabia) says:

Whoever contravenes or alters the ordinances of this edict will be cast out of the alliance between Allah and His Messenger. …This must not be violated or altered until the hour of the Resurrection, Allah-willing.

In a letter to me of August 3, 2020, Pope Francis expressed hope that “such covenants will serve as a model for the further enhancement of mutual respect, understanding and fraternal co-existence between Christians and Muslims at the present time.”

Two distinguished colleagues and indefatigable scholars, Professor Ibrahim Zein and his colleague, Ahmed El-Wakil of Hamad Bin Khalifa University in Doha, have just published, with Routledge, a book on the covenants.

You will find information on the book and how to order it here.

Please do purchase it and circulate its findings to your friends and colleagues.

Kendall Qualls, a new member of our board, recently published a commentary on how to promote the best interests of African American families after some 200 years of chattel slavery, 100 years of legal and social segregations and 6 decades of trials and tribulations.

I find his recommendations vitally important because they flip Karl Marx’s theory of what causes injustice on its head.  Marx believed that values and the derivative behaviors which they install in our psyches are superficial and that materialism structures social outcomes as the “base” of human fortunes and misfortunes.

Marx’s theory has been put in this graphic:

Kendall’s theory of achievement puts the superstructure of intangibles as the base of human civilizations, creating the realities of economy, society and politics, war and peace.  To a great extent, individually and collectively, we really are what we want to be.  This puts activating the best of ourselves – the quality and quantity of our personal capital – front and center in our “business plan” for living as well as circumstances will permit, at any given time.

To reconstruct Marx, we can say that the base of human capital shapes the superstructure of production – for richer or for poorer – while the superstructure then perpetuates value-oriented and cultural structures of the base.

Thus, while Kendall focuses on a particular challenge for the U.S., his recommendations have relevance for every human society.

You can read his commentary here.

The current issue of the Harvard Business Review has a brief article which gives an insight into the importance of “mindsets.”

Researchers collected data from 389 publicly traded Fortune 500 firms seeking to measure female influence on the top management team.  Their standard for firm success was Tobin’s q or the current market value of the firm, divided by the replacement costs of its assets.

The findings were: the more intense the presence of women in the management team (share of positions; rank of highest woman; ranks of all women; length of their “to do” lists), the higher the firm’s customer orientation and Tobin’s q.

A different mindset for women was proposed by the researchers as the cause of firm financial outperformance – an instinct for customers, so to speak.  The researchers called this customer mindfulness “interdependent self-construal,” adding: “Women are more likely than men to see things in terms of relationships and to consider the perspective of others.  So, when in positions of influence in the C-suite, they often promote strategic decisions that reflect a higher focus on customers.”

This study challenges older stereotypes: “Many studies suggest that female executives engage in reduced risk-taking, but customer orientation may actually result in female executives pursuing riskier strategies.”

The full study will be available in a forthcoming issue of the Journal of Marketing.

The Harvard Business Review, in its current issue, has an interview with Savva Shanaev on correlations between stock market movements and the calendar. (HBR reprint F2301B)

Shanaev and his colleagues mapped 100 years of U.S. stock market movements against the predictions for the coming of spring on Groundhog Day, when a groundhog in Pennsylvania is let out every February 2 to see his shadow.  If he does see his shadow, winter will last 6 more weeks and the stock market will be sluggish.  If he does not see his shadow, spring will come soon and the stock market will rise.

Also documented, according to Shanaev, is that the market tends to be at its worst from May to October.  Additionally, stocks tend to rise in January and market returns are lower than average at the start of the week – the “Monday effect.”  Other studies have found that stocks perform poorly around the full moon and when Mercury is in retrograde.

However, Shanaev said that the “Monday effect” is now so well-known that it has largely disappeared.

We in the West, at least in some countries, are living in an era fraught with concern for social justice – different outcomes for different people that seem unfair.

I have long been interested in better understanding why people are different one from another – children of the same mother and father have different personalities and life outcomes. Why?  And norms and behaviors that give rise to life outcomes might be common to this religious community, but not to that other one or to this class, but not to that or this ethnic descent group, but not to that one.

Famously, the German sociologist, Max Weber, connected the creation of wealth through capitalism with a religious mindset and its favored behaviors – the Calvinist Protestant ethic – encouraging dedication to one’s work, acceptance of personal responsibility, trust in those who are like-minded and savings.

“Otherness” seems a necessary part of the human condition.  So, if “otherness” is not going to go away in our lifetimes, what are we to do about its tendency to keep us apart from one another?

People in different societies live life differently.  Why?  People in one socially recognized class act, feel and speak differently from those in other classes.  Why?

We are told by those who insist that they know that our separatenesses necessarily give rise to cognitive biases favoring “our kind” and inducing us to give the cold shoulder or worse to “different” kinds.  Pope Francis, in his encyclical, Fratelli Tutti, disagreed and there urged us to overcome the political and psycho-social distancing associated with our differences.

I saw in a recent issue of The Economist a map of India showing that some regions of the country have more wealth and others more children.  It seems that the areas with more children have less wealth per capita.  Why should this be?

If different economic outcomes come from different behaviors and mindsets, what is to be done to equalize the outcomes?  What is fair?  Should changes in mindsets or behaviors be a condition for imposing social and political interventions designed to favor one group over the other so that outcomes change?  Cui bono – all or only some?

As we close the passage of time and events which was solar year 2022, I was thinking of all the ups and downs we have been through or witnessed from afar.  At times, it seems like our efforts are useless or evanescent, our prospects foreboding.  From whence cometh good cheer?

I might suggest to you that the light of hope, which each of you raises up, will bring us better days.  But it depends on us, as the founders of the Caux Round Table believed.  Individuals always make a difference – for better or worse or for naught.

I was reminded by this poem of Shaykh Rumi titled “Moses and the Shepherd” on the vital importance of each person:

Moses heard a shepherd on the road praying, God,
Where are You?  I want to help You, to fix Your shoes
and comb Your hair.  I want to wash Your clothes
and pick the lice off.  I want to bring You milk,
to kiss Your little hands and feet when it’s time
for You to go to bed.  I want to sweep Your room
and keep it neat.  God, my sheep and goats
are Yours.  All I can say, remembering You,
is ayyyy and ahhhhhhhhh.

Moses could stand it no longer.
Who are you talking to?
The One who made us,
and made the earth and made the sky.
Don’t talk about shoes
and socks with God!  And what’s this with Your little hands
and feet?  Such blasphemous familiarity sounds like
you’re chatting with your uncles.
Only something that grows
needs milk.  Only someone with feet needs shoes.  Not God!
Even if you meant God’s human representatives
as when God said, I was sick, and you did not visit me,
even then this tone would be foolish and irreverent. …

The shepherd repented and tore his clothes and sighed
and wandered out into the desert.
A sudden revelation
came then to Moses.  God’s voice:

You have separated Me
from one of my own.  Did you come as a Prophet to unite,
or to sever?
I have given each being a separate and unique way
of seeing and knowing and saying that knowledge.
What seems wrong to you is right for him.
What is poison to one is honey to someone else.
Purity and impurity, sloth and diligence in worship,
these mean nothing to Me.
I am apart from all that.
Ways of worshiping are not to be ranked as better
or worse than one another.

It’s all praise, and it’s all
right.
It’s not Me that’s glorified in acts of worship.
It’s the worshipers!  I don’t hear the words
they say.  I look at the humility.

Happy New Year.