Before The Weekend #2 — 19 March 2021

Stopping activist shareholder short-term greed, the ecology tipping point in industry, beating priority overload and the Vatican and sinning.

Stopping activist shareholder short term greed

We need to move from activist shareholder short-term greed to multi-stakeholder capitalism. The removal of (ex-)CEO Emmanuel Faber from Danone this week, is the perfect example of this greedy thinking.

In spite of Mr. Faber’s commitment to noble purpose, the financials didn’t follow suit. This resulted in a small minority of shareholders pushing Faber out. Even though the vast majority of the shareholders had previously voted in favor of the Danone noble purpose plan.

There are several reasons the numbers may not have been as positive as expected and I wonder if any of these were applicable in the case of Danone. For example:

• Minority shareholders focussing only on short term value should be pushed out or aligned with the board of directors
• The board of directors and the leadership should be aligned
• The board of directors internally should be aligned
• Noble purpose should be communicated clearly into the organization

And finally, value creation through noble purpose takes time to become profitable. This is why minority activist shareholders with their short-term views are so detrimental.

Ecology tipping point in industry

A tipping point is a moment where we go to a point of no return, where we can’t turn back. This can be very positive thing, as we see in the case of several car manufacturers finally committing to a solid ecological approach.

• Volkswagen announced that by 2030, 70% of all cars in Europe will be electrical.
• BMW said that by 2030, 50% of their cars will be electrical and the Mini brand will be 100% electrical. They also stated their ambition to become the greenest car manufacturer and want to embrace the principles of the circular economy.
• Solvay, Veolia and Renault are entering into a partnership to start upcycling used electric car batteries

We see similar trends in other industries, like Arcelor Mittal, that by 2022 will be producing 600.00 tonnes of steel with green steel certificates. This is clearly a sign that we are at the ecological tipping point.

Important lessons to be learned here:

• How much impact determined leaders like Elon Musk can have on their industry
• Governments and industry can have a muntually beneficial impact on each other
• Industrial partnerships are possible, even among competitors
• Ecology and economy are being integrated much more, instead of being separated

Beating priority overload

During this pandemic, we see more and more people complaining about having too many priorities and by definition, this means nothing is really a priority any longer. People are confused, fatigued, getting burn-outs and becoming more disengaged from their jobs.

Too often, we still hear from companies that they do what they do to make money for shareholders, which in no way helps motivate their people, nor does it give them any clarity on their priorities.

A clearly defined, unique and specific noble purpose is the solution here. Not only will it make people more engaged, proud and aligned, it also greatly helps them prioritize and organize their work.

The Vatican and sinning

By stating that homosexuality is a sin, the Vatican has missed out on the opportunity to become a modern and inclusive organization. How can loving someone of the same sex be a sin, knowing that ‘sinning’ is an act and an active choice?

It’s unlikely that this is simply the viewpoint of Pope Francis, but rather the result of the way the Vatican is organized. By making this a priority, they are positioning themselves as outdated and medieval, instead of grasping the opportunity to present new and modern messages, in line with the evolution of humankind.

I wonder if they are aware of the collateral damage this might create? I’m thinking in particular of societies where there’s still confusion with regards to accepting or not accepting homosexuality. Or the impact on the younger generation. Do they think this will lure them back to the Church?

And finally, how hypocritical is this viewpoint, knowing that there are many homosexuals among the clergy, especially in the Vatican? How is this authentic? Shouldn’t religion be all about love?