Can business leaders solve some of the world’s most pressing issues? Richard Branson thinks so. He has assembled a global team of A-list entrepreneurs and executives to make businesses behave better.
Richard Branson might be one of the world’s wealthiest men, but he presents as considerably more laid-back than most of the well-heeled patrons at the exclusive Soho House New York, where we meet. Relaxing on a brown leather couch in the private club’s lounge and restaurant, he holds back-to-back meetings as other guests try to look like they’re not straining for a glimpse of the billionaire entrepreneur, adventurer and philanthropist. After our meeting, as I walk up Manhattan’s Ninth Avenue, I hear a man who had been dining nearby speaking excitedly into his cell phone about Branson’s presence. Such is the Virgin Group founder’s unusual crossover status. There are few businessmen who can get people as excited to be in their vicinity as they would get for rock stars.
Branson, whose long and well-documented career began in media, first in publishing and then in music, has always understood the importance and impact of image. He has used his star power to great effect both as an entrepreneur and as a philanthropist, teaming up with celebrities and statesmen to push for action on AIDS and climate change. The “Elders” – a group of world leaders he co founded with the late Nelson Mandela – tried to find solutions for some of the world’s most destabilising international conflicts.
The B Team, Branson’s latest venture – co-founded with Jochen Zeitz, Director of Kering and Chairman of the board’s sustainable development committee– is his latest attempt to corral star power and influence to change the way the world works. In assembling the B Team, a group of business leaders, politicians and civil servants who have committed to addressing global human rights and environmental challenges, Branson and Zeitz hope to change the way business owners and operators interact with the wider world.
Jochen Zeitz
“I thought we’d been successful in Uganda – I spoke out quite strongly about it – but more importantly I got a lot of Ugandan businesspeople to go in to see the president,” he said, “and he assured all of us that he was going to do nothing, that he was going to block” the bill. “And so I think we came that close to him being brave.”
“There is a danger that with Uganda by speaking out we could have actually done damage,” he added. “It was almost a popular thing to stand up against the foreigners.” Rajiv Joshi, the former Scottish youth leader and Oxfam coordinator who is now the acting CEO of the B Team, disagrees. “I’m not sure that Richard was counterproductive. I think he probably helped raise the profile of the issue, and is probably being quite humble,” he said, from a perch at a table that overlooks the open-plan workspace his staff shares with a socially oriented business. Joshi’s path has taken him from street-level organizing to his position with the B Team. While someone with his background might be expected to be sceptical of the idea, he emphasised throughout our conversation that major social problems will not be solved without input from business.
The situation in Uganda clearly shows that there are limits on what a businessperson can do, however well known and influential. Asked what leverage he has on such an issue, Branson said: “I won’t do business in Uganda; I think Uganda just went too far.” He later added: “You’re always going to find things in every country, and you can say I won’t do business in this country, I won’t do business in that country.” He says there are, however, “exceptional circumstances where you’ve just got to make the stand.”
If the B Team succeeds, more business leaders will make such a stand. More of them may even enter the unusual space Branson himself occupies, somewhere between executive, lobbyist, celebrity, and ethicist. The inaugural group of mainly business founders and owners, executives and current or former public officials has committed both to spreading a gospel of ethical business and governance around the world, and to running their own companies in accordance with it. In the core set of B Team leaders are several Africans, including the telecoms magnates Strive Masiyiwa of Zimbabwe and Mo Ibrahim of Sudan, and Nigerian finance minster Ngozi Okonjo-Iweala.
Supported by a young staff lead by Joshi and working from a loft in Soho, New York City, the group has agreed to pursue a set of 12 agenda items that have evolved out of their own collective philanthropic and political interests. Its operational budget comes from businesspeople and foundations including Virgin Unite, the charitable arm of Branson’s Virgin Group. Other sponsors include Kering, the Tiffany and Co. Foundation, and individuals like Masiyiwa and the New Zealand tech entrepreneur Derek Handley, who served as the B Team’s founding CEO.
Joining the B Team commits members to steering their companies ethically in areas that vary from environmental impact to engagement with governments to stress on employees. It also commits them to lobby politicians, work with civil- society organisations, and draw public attention to the sorts of “exceptional circumstances” Branson mentioned. The B Team, which has no enforcement mechanism, will instead rely on a combination of group cohesion and social pressure to shape the behaviour of members.
The overall mission of the group, according to a declaration signed by the founding members of the B Team and available on the organisation’s website, is to encourage businesses to operate in a fashion that “puts people and planet alongside profit”. This goal for business is often referred to as the “double bottom line.”
Socially conscious efforts by business leaders are sometimes greeted with scepticism. “Increasingly,” wrote Professor Michael Porter and Mark Kramer back in 2002 in the Harvard Business Review, “philanthropy is used as a form of public relations or advertising.” Though they were talking about corporate donations to charity, a similar observation inevitably arises in response to efforts like the B Team. As the Economist’s Schumpeter columnist wrote in 2012: “Experienced watchers of Sir Richard may suspect that the B is for Branson.”
Whatever the potential PR benefits of joining the group, the B Team members have been vocal about the impact business has had on the world. Asked why executives should care about sustainability, which he has pursued through his own philanthropic and corporate work, Zeitz said that while business certainly has had “some benefits” for the world, “we also need to realise that business has made a very negative impact. Not just from an environmental point of view but from a social perspective.” Mo Ibrahim, contemplating business’s negative impact on Africa, said that “for every politician, there are a dozen or more corrupt international businessmen.” And as Branson said himself: “In 2008, 2009, certain businesspeople nearly brought the world to its knees. Therefore I think there’s a lot of work business needs to do to mend bridges.”
Going it Alone
Working with governments can be difficult for businesses, especially at a moment when, as The Economist pointed out in a 1 March essay mentioned by Branson, many of the world’s most efficient governments are probably dictatorships – not traditionally great friends to free enterprise. In an era when the United States can barely pass an annual budget, regulating to keep up with complex, global developments like a more flexible labour market or a warming planet is difficult.
The B Team will try to fill gaps in law and policy-making by getting corporate leaders to impose more constraints on themselves. They will be filling a role that regulation – of the working hour, environmental impacts, labour conditions, and so on – sometimes has in developed countries and often never has in many developing ones. Thus the members, who come from five continents, have found themselves in discussions that sometimes sound more like high-level diplomatic negotiations than board meetings.
Arianna Huffington
The diversity of members, and by extension of the B Team’s goals, can make it difficult to see what everybody has in common. The first thing, in several cases, is Branson. Arianna Huffington said she “instantly said yes” to Branson’s request that she join the B Team: “For years he and I have talked about how we’d like to collaborate on something big, and the B Team’s mission of prioritising people and planet alongside profit is something we’re both deeply passionate about.”
Mo Ibrahim
The feeling of admiration is mutual. When we met, Branson had kind words for any fellow B Team member whose name came up in discussion. Paul Polman of Unilever is “a wonderful individual”; Grameen Bank founder Muhammad Yunus has a “wonderful heart”; Arianna Huffington’s eponymous Post is “one of those rare positive news [sources] in the world” – “I love the approach.”
Most of the B Team members also have some publicly demonstrated prior interest in public policy or public service. Strive Masiyiwa is a Christian humanitarian who has focused on educating entrepreneurs. Mo Ibrahim’s foundation fights corruption and supports good governance. Mycoskie has pioneered an anti-poverty business model. A few politicians and officials not directly involved in business are also B Team members, among them Okonjo-Iweala of Nigeria and Mary Robinson, the former president of Ireland and former United Nations High Commissioner for Human Rights. Zeitz and Branson worked with a group of experts to review a list of potential members they had put together. “Richard and I interviewed all the leaders to become part of the inaugural group,” Zeitz said.
Besides Davos, the group has met in London and in South Africa, with absent members dialling in when they are able. Even for A-list executives, that can sometimes be tricky. Zeitz missed the Davos meeting, he says, thanks to a poor internet connection. The members are, however, in constant communication about their vision. Said Ibrahim: “There’s a number of reiterations, drafts. Different people also adjust different things and review different things […] It’s not just one meeting where people wrote a statement and voted for it.” The democratic process prevails within the B Team even if, like democracy in the political world, it is not always completely smooth.
“It’s democracy”
In January this year, the B Team released a statement under the heading “B Team Leaders call for business to stand up for human rights.” Invoking the April 2013 collapse of the Rana Plaza building in Bangladesh, which killed at least 1,134 garment workers, and the abuse of migrant labour in the Persian Gulf, the statement calls on business people to comply with UN human rights guidelines, to fight corruption, and, finally, to “use their influence to uphold human rights.”
The statement goes on to condemn “preventing peaceful protests, treating people unequally because of their gender or criminalising people on account of who they love.” While the wording of these lines, and much of the statement, is delicate, the timing left little doubt to what the last phrase refers. The release came just before the Ugandan anti-gay bill was passed, and just after a similar bill was signed in Nigeria.
“It was an interesting meeting,” said Mycoskie. “We were
Ngozi Okonjo-Iweala
Some of the B Team members did not sign the Davos statement. “The majority of the leaders need to agree [for a statement to be] adopted – and the majority really means more than 50 percent,” said Zeitz, the B Team’s co-founder. “If somebody is uncomfortable with the statement, he or she has the opportunity to say, ‘I’m not going to put my name on it’.” He points out that “it’s impossible for everyone to agree to everything.”
Among the people who did sign the statement was Ngozi Okonjo-Iweala, the finance minister of Nigeria. In May 2013, Nigeria passed an anti-gay bill that was signed into law on 7 January 2014. “Ngozi was very brave,” says Branson, talking about the Davos meeting. “She was great.”
Reached by phone, Okonjo-Iweala said of the Nigerian legislation: “Personally, I don’t like it” – immediately adding – “but its democracy.” She points out that close to 100 percent of Nigerians supported the bill. “It’s very difficult in that situation to go in the opposite direction. Sometimes you can do that when you exert leadership – when you think you stand a chance of really turning the sentiment of the population and getting them to follow you. But if you find that you cannot […] then it becomes a thing of great frustration, and you’ve got to change tactics. You’ve got to look at educating the population to evolve, and to understand why they need to think differently.” “It’s my job,” she says, “to explain to the other members of the B Team who are not in government how things work from a government perspective.”
Standing on ceremony when it is not effective is not particularly appealing to many businesspeople, especially in an era when governments often move slowly. “Does the current system of democracy work?” Branson asked at one point during our meeting, mentioning the Economist essay. He circled back to the topic again a few minutes later. “Capitalism and democracy have their faults. One of their faults is the extreme wealth that goes to a few individuals as a result of their position. With that extreme wealth comes extreme responsibility. I think that actually applies to every business out there.”
When I asked whether he thinks democratic ideals need to be respected in dealing with global issues, Joshi, the B Team acting CEO, responded affirmatively: “I mean, that’s kind of where I’ve come from – the idea that people should be able to have a say in the decisions that affect their lives. I’ve spent my life on this – on the streets of the G20; I was on Wall Street when the banks were being bailed out and the homeless people were holding signs up saying ‘bail me out, too’. I understand the contradictions of the system that we have. I also understand the great risks – the gamble that we have ahead of us – if we can’t find a way […] to mobilise a whole new type of leadership.”
Several B Team members I spoke with mentioned inequality as a major issue. In fact, many of the concerns they raised, and that the B Team’s platform raises, would not have been out of place at one of the Occupy Wall Street protests to which Joshi refers. But unlike those protestors, the B Team members do not lay all the blame at the feet of executives, who are generally the visible face of a company. When companies are publicly traded, says Mycoskie, “they have shareholders, and shareholders have signed up to be shareholders with a certain kind of intention, and that is maximized profits. Unless the company explains to the shareholders at the beginning when they bought the stock that they would be running their business in a certain way that can be difficult from a legal perspective.”
Classically, the shareholder system is designed to give everyone with a financial stake in the company some voice in how it is run. Yet it can sometimes become an impediment to implementing policies executives want, including policies of the sort B Team members have promised to pursue, and to encourage others to pursue.
Branson explains how Tim Cook, the head of Apple, had, “the day before yesterday, in a shareholders meeting, had these shareholders saying that he should pay back any money he had spent on environmental [measures],” that “he should personally pay back the shareholders,” said Branson. “He just stood up and said, as far as I’m concerned, any shareholders that do not believe that Apple should act in an ethical way – and in his opinion an ethical way includes dealing with the environment – should take their money out of Apple. Anyway, enormous respect for him,” he concludes. “He just basically told them to sod off.”
Getting more people to buy into the B Team’s basic premise – to the point where shareholders no longer demand maximum returns at the expense of ethical principles – will be key to the group’s success. A long-term goal, according to Joshi, is to dramatically expand the reach of the organisation’s platform by getting more people to see themselves as “B leaders”. He said: “We want to replicate this around the world so that we have, one day, thousands if not hundreds of thousands of business leaders.” These leaders, he said, would be “working on the same challenges in their own local contexts.”
While many of the B Team members interviewed spoke urgently about issues from climate change to employment, they were all hopeful that the group’s high profile would give them a chance to spur a global conversation around these issues. And long though the B Team’s deliberation process at a place like Davos might be, several members said they felt this internal conversation – partly a product of its diversity – would make the organisation richer. “We haven’t lost a B Team member yet,” Branson mused from his spot on the Soho House restaurant’s couch. “We’ll have good debate. We’ll try to keep everybody together.”
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