[T]wo deeper forces help to explain why the Business Roundtable felt that it needed to say something now.
First, activist shareholders are making life uncomfortable for the boards and senior executives of America’s largest corporations. The Business Roundtable’s statement is thus in part a plea from CEOs for more autonomy vis-à-vis shareholders. In effect, the Roundtable’s statement does constitute a “declaration of independence” – one seeking to liberate CEOs and boards from the influence of activist investors. Thus interpreted, US corporate leaders are building a coalition against activist shareholders, and want employees, customers, and those demanding more ethical sourcing to support them. Freeing boards and executives from shareholder influence, the statement implies, will enable corporate America to treat employees, the environment, and communities better.
Second, as politics and public opinion shift beneath corporate America, CEOs are trying to maintain their balance. US Senators Bernie Sanders and Elizabeth Warren, two of the leading contenders for the 2020 Democratic presidential nomination, have called for major changes in the way large corporations are run. Warren, for example, wants employees to be represented on boards (as is common in Germany and some other countries) and favors breaking up America’s largest firms. And while US President Donald Trump has yet to turn his anti-elite populism against the corporate sector, he is unpredictable – and some of the most powerful examples of elite privilege occupy US C-suites.