A Tyranny for the Good of its Victims: The Ugly Truth about Stakeholder Capitalism
Andrew F. Puzder (Encounter, $45.99,. 335 pages)
Andrew Puzder is a former CEO of a CKE Restaurants (which owns Carl’s Jr and Hardees) and commentator on economic affairs. In A Tyranny for the Good of its Victims: The Ugly Truth about Stakeholder Capitalism he examines the corporate commitment to ESG and DEI and the harm that these supposedly socially conscious trends do to society and corporations. ESG stands for Environmental, Social and Governance issue, DIE for Diversity, Inclusiveness, and Equity. By advancing these social issues, Pudzer argues, activists dressed up as do-gooders were able to “insidiously advance stakeholder capitalism and ESG to the point where they became pervasive and negative influences in our economy, our politics, and our lives.” Stakeholder capitalism, such as that promoted by (among others) the World Economic Forum and the Great Reset, in Pudzer’s words, “empower a small group of elites to dictate our nation’s social and political policy, all in the name of protecting the masses.” The idea is that corporations have a responsibility to act for all stakeholders, not merely shareholders, to protect the planet, improve social conditions, and generally make the world a swell place.
The problem is that stakeholder capitalism is a threat to the democratic process, because few individuals and smaller corporations can withstand the corporate power of the Big Three — Blackrock, Vanguard, and State Street. Activist investor get corporate boards to minimize their obligation to shareholders (to produce profit) in favour of pursuing various political agendas and social goals. This this redefinition of corporate responsibility is undemocratic because the public is powerless to influence these corporate decisions. The Big Three are simply behemoths capable of throwing their financial and reputational weight around to force other companies to comply with their political and social agendas. Puzder is adept at showing how modern financing is leveraged to pursue collectivist goals; many other corporations bend to the pressure of the Big Three even when it might hurt their bottom line. A cynic might say that these Big Three are getting others to shoulder the economic costs of their political and social agendas. The way to fight back is first to become educated about stakeholder capitalism and have investors pushback against efforts to impose political and social priorities over the fiduciary duty of maximizing profit.
