Time For A Shakeup At The Business RoundtableJeffrey E. Garten
On Sept. 13, the Business Roundtable established its first project on the Digital Economy. Imagine that. America's premier business association, which is composed exclusively of 150 active CEOs, is just getting around to such cyberspace issues as taxation of e-commerce, cybercrime, and privacy. It makes you wonder whether the BRT's members are squandering the chance to be global leaders or whether they simply don't want the job.
The problem with the Business Roundtable is that it has defined itself as little more than a traditional lobbying organization--the kind that could have existed 50 years ago. Implicit in its work is an obsession with what government should and should not do to the exclusion of something just as important: what companies ought to be doing for society at large.
We should be able to look to these leaders for more than just building shareholder value and broadening consumers' choices, critical as these goals are. In an increasingly deregulated and entrepreneurial economy, we should expect more cutting-edge thinking from a group that includes such corporate luminaries as GE's (GE) Jack Welch, Exxon Mobil's (XOM) Lee Raymond, and Citigroup's (C) Sandy Weill. The business elite ought to take more responsibility for the impact of their global operations on workers, communities, and the environment. They should also help strengthen the rules and institutions for trade, finance, and e-commerce.
According to Samuel L. Maury, president and staff director since 1994, the BRT's mission is to steer government in the right direction by marshaling the clout of the nation's most powerful business executives. Involvement of CEOs is the critical asset: They alone determine the agenda, lead every project, make up every task force, and decide on new members in the club.
PIVOTAL ROLE. BRT Chairman Robert N. Burt, who is also chairman and CEO of FMC Corp. (FMC), says the Roundtable's strategy is to focus on just a few legislative issues and do them well. He emphasized to me the pivotal role that the association played in the passage of trade legislation for NAFTA and permanent normal trade relations for China, as well as ongoing efforts to limit legal liability under a Patient's Bill of Rights. Burt and Maury also point to other important but less visible activities, including grassroots efforts to help state and local governments improve K-12 education and continuous involvement in corporate-governance issues.
While the BRT's accomplishments, particularly in trade legislation, should be applauded, a more ambitious strategy would better serve business and the country. But for that to happen, the BRT would have to expand its role from just focusing on government actions and legislation to pro-actively advocating a set of national priorities from the vantage point of private-sector leaders. These could be carried out together by various combinations of government, business, labor, and nongovernmental organizations.
For example, the BRT might describe how it thinks the American workforce ought to evolve in the New Economy, including how portable pensions, health care, lifetime education, and personal stress ought to be handled. It could paint a picture of U.S. relations with Mexico that goes well beyond the provisions of the NAFTA treaty and encompasses trade, finance, immigration, physical infrastructure, and the environment. It could offer its views on the global framework for commerce, including how to strengthen the World Trade Organization, how to streamline today's cumbersome approach to international antitrust, and how to handle labor and environmental issues.
Implementing a broader mandate also would require BRT members to acknowledge that they should focus not only on what government should or shouldn't do but on the responsibilities of the business community, as well. For instance, the BRT could draw up and implement a program for corporations to make information technology more available to the have-nots at home and abroad. It could make more comprehensive efforts to implement effective self-regulation of privacy in cyberspace.
Finally, in order to shake itself up, the BRT would have to elect CEOs to its board who believe in a broader concept of leadership than is in vogue today in the organization. It also would mean recruiting more tech company executives, who are now notably absent, such as Cisco Systems' (CSCO) John Chambers, Intel's (INTC) Craig Barrett, and Dell Computers' (DELL) Michael Dell. To expand its global horizons, the BRT could include more CEOs of foreign companies that have major businesses in the U.S., such as BP Amoco's (BPA) John Browne or Nokia's (NOK) Jorma Ollila. And the BRT's base of operations could be located not only just inside the Beltway, as it now is, but also in Silicon Valley.
Remaking itself this way would be painful for the Roundtable. But a New Economy requires new thinking, and right now, the BRT looks like your daddy's Oldsmobile.