Ranked in the top 1% of all podcasts globally!
Feb. 15, 2022

133 The Six New Rules of Business: Creating Real Value in a Changing World with The Aspen Institute’s Judy Samuelson | Greater Washington DC DMV Changemaker

133 The Six New Rules of Business: Creating Real Value in a Changing World with The Aspen Institute’s Judy Samuelson | Greater Washington DC DMV Changemaker
Apple Podcasts podcast player badge
Spotify podcast player badge
Google Podcasts podcast player badge
Amazon Music podcast player badge
iHeartRadio podcast player badge
Stitcher podcast player badge
TuneIn podcast player badge
Podchaser podcast player badge
Overcast podcast player badge
Castro podcast player badge
Castbox podcast player badge
Deezer podcast player badge
PlayerFM podcast player badge
Audible podcast player badge
Podcast Addict podcast player badge
YouTube podcast player badge
RSS Feed podcast player badge

In this episode of Partnering Leadership, Mahan Tavakoli speaks with Judy Samuelson. Judy Samuelson is the Aspen Institute Business and Society Program's founder and executive director. Judy Samuelson is also the author of The Six New Rules of Business: Creating Real Value in a Changing World.In this conversation, Judy shares how societal shifts have changed traditional approaches to how businesses operate, a greater need for purpose, and the role of business in society. Judy also shares what leaders of organizations can do to create greater value and ensure success in the changing environment. Finally, Judy Samuelson also shares why we need to redesign the attitudes and mindsets that define leadership and business success.

Some Highlights:

- How and why the Aspen Institute gathers, supports, develops, and challenges leaders across various sectors

- Judy Samuelson on embracing the "new rules" that are already in play in business

- How human intervention plays a vital role in overcoming shareholder primacy to ignite change in the system

- Judy Samuelson on designing a new company culture more suitable to the societal changes taking place

- Why shareholder primacy only works for a few, and how to change it

- Judy Samuelson on examples of purpose-driven companies  

- The government's role in regulating business

- The need for more collaboration between companies 

- Judy Samuelson on why employees are crucial in keeping organizations accountable

- Trust as the number one intangible asset that drives business value

- Judy Samuelson's perspective on the future of business

Also mentioned in this episode:

- Anand Giridharadas, journalist and author of Winners Take All 

- P. Roy Vagelos, president and chief executive officer and chairman of Merck 

- Peter Drucker, educator, business and leadership author

Books Mentioned:

The Six New Rules of Business: Creating Real Value in a Changing World by Judy Samuelson

Winners Take All: The Elite Charade of Changing the World by Anand Giridharadas

Connect with Judy Samuelson:

Judy Samuelson Website

Judy Samuelson on LinkedIn

Judy Samuelson on Twitter

Connect with Mahan Tavakoli:


More information and resources available at the Partnering Leadership Podcast website: 



Mahan Tavakoli: 

Welcome to Partnering Leadership. I'm really excited this week to be welcoming Judy Samuelson. Judy is the founder and executive director of the Aspen Institute Business and Society Program. She is also the author of The Six New Rules of Business: Creating Real Value in a Changing World. And I really appreciated the conversation with Judy as I learned what we can do as individuals and also as leaders of organization to have a real impact in this changing world.

I also enjoy hearing from you. Keep your comments coming. mahan@mahantavakoli.com. There's a microphone icon on partneringleadership.com. Really enjoy getting those voice messages. Don't forget to follow the podcast. Tuesday conversations with magnificent changemakers from the greater Washington, DC DMV region, and then Thursday conversations with brilliant global thought leaders.

Now here's my conversation with Judy Samuelson.

Mahan Tavakoli: 

Judy Samuelson, welcome to Partnering Leadership. I am thrilled to have you in this conversation with me. 

Judy Samuelson: 

Thank you. I'm glad.

Mahan Tavakoli: 

Judy. I loveThe Six New Rules of Business: Creating Real Value in a Changing World, and also much that you've been doing with respect to business as a vehicle for change. But before we get to some of those conversations, I would like to know whereabouts you grew up and how your upbringing impacted who you've become?

Judy Samuelson: 

I grew up in San Diego county, Southern California in a rural rapidly growing part of the county, not on the beach, but in the hinterland. More horses than surfers, I guess I would say stayed in Southern California. I came east after working in Sacramento for a number of years.

So I'm a native California and I grew up in a family that my dad worked for the phone company. And so the phone company, as we used to call it. So I think in some respects it was like working for the government or the military or something. There was like, it was a massive utility and he had a notion of service. And I think my parents raised us going to church and there was a kind of a soft message around service and being present in a community and being part of institutions and supporting institutions that support you. 

And so I think the trade-off was always part of the mix and working in Sacramento and the state government certainly gave me a good dose of that as well. I think that the thing that I got fortunate in life was that I came east for grad school, rode that into New York to work in banking for a while. And I was in banking for seven years. Then I went to the Ford Foundation. And so in the period of time, before I started this program in Aspen,  I had worked in government. I had worked in the private sector. I had worked in the nonprofit and philanthropic sector. And now of course, I've spent a couple of decades in a nonprofit organization, the Aspen Institute.

And I think I was very fortunate to actually have these different perspectives. You know, it's the kind of thing that I didn't go out to design my career that way. But I think it's helped me in good stead because naturally, it may build some of your ability to look at things through other people's eyes a bit, by working across these different kinds of domains.

Mahan Tavakoli: 

It is really important to be able to do that. And I think Aspen provides you a platform for that. Now for anyone in the audience that is not familiar with what Aspen Institute does, even some people in the greater Washington DC region are not as familiar and specifically the businesses society group that you founded. What does Aspen do? And what is the business and society group within Aspen? 

Judy Samuelson: 

Well, the Aspen Institute is a nonprofit that's been around for almost 80 years at this point. So it's an established platform. I say it does two things. It's about dialogue and it's about supporting and developing and challenging leaders across different sectors.

And so the business and society program is one of dozens of programs that resides within the Aspen Institute. We have our independence. We need to stay within the rules of non-partisanship and open dialogue and welcoming the table from different perspectives, but we're not debating society. We're about leaning into problems. We are drawn to problems of systemic change. I'd say that's true of most of my peers that run programs on education and society or sports and society, or, look at some of the complicated questions around the community and economic development and rural development.

We all are leaning into the problem and we bring people to the table who share the sense of urgency and the need for moving forward in a progressive way and to embrace a problem and try to figure out where are we stuck? What's the solution space? What do we need to do to move forward? 

And so it's a wonderful institution. And it's not about the Aspen Institute. It's about having a platform to bring people together and then creating the opportunity for them to lead more aggressively as we say, to help pick up the pace of change. 

Mahan Tavakoli: 

So to a certain extent you are also at the cutting edge of hearing perspectives from a lot of people within the space. So what was it that got you to think that we need new rules for business? Eventually writing this book on the Six New Rules. 

Judy Samuelson: 

Well, when I had the good fortune to meet the publisher Berrett-Koehler, one of the observations of the editor I worked with there was, he said, “I think you're saying it, these rules are already written. That they're not new, that they're already in play.”

I think that's exactly right. So I write about rules that I call them, the new rules, but these are rules that I think are already in play to a different extent in different kinds of organizations. And we're not going back. These are things that are, the basic premise that corporations don't exist just to put shareholders at front and center. 

People who run corporations, global enterprises, they have to multitask. They have to be able to take in the perspectives of people throughout that system. They have to listen to their suppliers. They have to listen to their customers. They have to listen to their own employees. Increasingly today, you can't do that. So single objective functions never work out. And they certainly haven't been working out in the world of business these last decades. 

And so these are things that have already been opened up. The question is how quickly are we going to see them embraced? And are we taking into account the extraordinary ways in which we really need to influence the system, which businesses apart the ecosystem of business to embrace the change that we need from the business sector?

So, I have observed business from different points of view. I was with colleagues of the Ford Foundation. We started something called The Corporate Involvement Initiative back in the mid 90’s. That's the work that carried me forward to say. We see extraordinary examples of businesses that are playing a little differently than their peers, or they may be ahead of the game. How do we get more of that? I call out the examples of Levi Strauss. I call it the example of Nike. Sometimes it's part of a family legacy. Sometimes you need a swift kick in the rear from an organized NGO. That's essentially calling out a practice, choosing your brand to make the point.

In these cases, we saw extraordinary leadership. And I asked the question, how do we get more of this? How do we stimulate that kind of thinking in the business sector without necessarily waiting for idiosyncratic reasons, to see one leader at a time before it?

And so I started looking at business education and that's what I initially left the Ford foundation to do was to create a program that was really going to influence business schools. That's some of the work we've done, but we've moved on to embrace business leadership and leadership programs that support business change agents. And so there's a lot of work to be done, but I've had the opportunity to observe the change that I think is taking place. And that's what I'm really writing.

Mahan Tavakoli: 

And that change that you mentioned is taking place. One of the elements, the second rule is businesses serve many objectives beyond shareholder value. One of the challenges I see with Judy is that we still measure with that shareholder value. 

So when talking about the need for diversity and inclusion in organizations, there is the conversation around you will get better shareholder value return to shareholders. If you do that, when there are conversations about the need to invest in employees, it's connected to the benefit of shareholder values. So that is one measure that is consistently used, including with the performance of executives and CEO compensation. How can we decouple how we evaluate organizations and executives from that shareholder value? 

Judy Samuelson: 

Well, these are all human designs. And so it requires human intervention. Change takes place when business executives see somebody else operating differently and see an idea that they can emulate or that they become convinced that it's a better way of operating. Problems like how we've designed CEO pay are incredibly complicated and sticky.

We know what needs to be done, but we're both working against forces that in fact want shareholders to still dominate the system who either ideologically believe that that's the best way to operate or who are benefiting from the system as it is designed now. 

And so we need courage in the form of, maybe new executives that are building companies today are just starting to take their companies public, who are willing to try a different method. 

I think Executives left to their own devices, understand that you need to pay executives, the analogy I use, it's as if we're flying an airplane and the only person we really care about is not the engineer, not the groundsmen who made sure that the systems are all working well before we took off, not the people that are serving the people on board and keeping them safe, but as if the pilot is the only one that matters.

So we know that that's not the case, we know that effective companies have cultures that support teamwork and that engage executives and managers and employees from top to bottom to get a better result. And so, we knew this in the quality movement of what would be called lean manufacturing today, the importance of the initiative to reside within the employees so that they can in fact offer up a better way to operate. We've seen some of this happening during COVID. 

So why do we design the pace system? As if the CEO is the only one who matters. And load them up with stock as if the shareholder is in fact, the owner of the corporation, when we know the shareholder owns shares of stock, they don't actually own the enterprise.

So we could talk more about that kind of articulation of law and our belief that we need to design companies with cultures that actually are both open and resilient and that can embrace some of this complexity in which business operates today. Invite the outside-in. Enable employees to be able to make those connections between what they're seeing is when they go home or on the weekends or their role as citizens. Social media breaks down these walls and we have the luxury today of employees that are able to make these connections. We need cultures that are going to open up and recognize that. 

So there's a lot of motivation for executives to think differently today. The question is whether we're going to get there and what kind of leadership we need to see in the business sector to open up some of these ways in which the scaffolding of shareholder primacy is still in place. But these are human designs. It wasn't on Moses' tablet. This is something we have created and it's on us to invent the way forward. 

Mahan Tavakoli: 

And that's one of the things that reading your book highlighted for me, Judy, in that the concern had always been in the back of my mind. And what I hear is, 90% plus of the profits of organizations are returned to shareholders. They are the owners of the corporation. And you say that's not exactly the case. 

Judy Samuelson: 

It's not legally the case. I mean, they're owners of shares of stock. Shareholders have unique rights. A lot of them come into play during a time of when the company is not performing and you need to unwind the corporation. Shareholders have some rights. So they have the right to vote for the board of directors, but the board is predominantly put together by the CEO. They have the right to vote on pay, but they tend to vote up as long as the stock price is going up, but they only write it down if they don't like what the stock price is doing. So it's just as well that the real responsibility of the board is to the enterprise itself. The company owns itself. It's not owned by shareholders. Shareholders own shares of stock that come with some important rights. And that's pretty well accepted in the corporate governance domain legally. That doesn't mean that we don't have lots of ways in which the kind of era of shareholder primacy still has a stronghold on the system. But that's partly about winners and losers that the stock market is hardly a bellwether for the economy.

And I think we've seen this clearly during the time of COVID. Stock price is going up. People are losing jobs. There's a lot of people who have been hurt horribly by the pandemic and by an economy that's actually not working for everybody. So, we have to step back from this and say, with a focus on shareholder primacy, what it's really enabling is it's enabling a small portion of the people that have the kind of greatest concentration to start to get more and more wealthy. But it's not exactly a way of distributing profits, widely to the extent that we know is important in order for the economy to be strong and for companies to be resilient. And so it's a question of design but shareholder primacy has a lot that keeps it in place because it's working well for a few.

Mahan Tavakoli: 

Gary Bolus, he leads the future of work at a Silicon valley think tank singularity university says these are not natural laws, they are man made constructs. And in this instance, this has just been the case for the past 40 years, which has skewed the focus of the executives and the organizations. So we can make adjustments to pull back from these 40 year experiments. 

Judy Samuelson: 

Yeah. And we're seeing a lot of experimentation there. That's essentially what the whole B Corp movement is about, it’s experimenting with the notion of ownership and the structure of a corporation. And can you write it into the charter to assure, sustaining those values that the founder cared about. 

I was reading an article that I think is in the New Yorker this week around the design of companies that can, we use trusts in creative ways to assure that continuing values of a company, I want to come back and make the point that legally there's nothing that a B Corp can do that a C Corp can't do. C corporations, Delaware law does not constrain the board from making reasonable judgments that they think are in the long-term interests of the enterprise. And that takes us back to this tension with shareholders in the company. We tend to talk about shareholders as if they're one monolithic group and they all have the same interests. And of course they don't. Depending on how much they own, depending on if you're an essentially part of a universal investment, your stocks or you hold a wide portfolio and you're in a pension fund and your investment needs to be secure for a long period of time because you're investing in saving for a long time from now for your children's education or retirement or whatever your ends are. Those tend to be very different objectives and somebody who's coming in now, the stock today to try to make a quick buck. And then in between lies everybody else. 

And so, it's all about timeframes and it's all about long-term intentions. And the last thing I'd say about the purpose of the corporation and shareholders is that the real purpose of the corporation tends to be revealed through what we observe from the corporation itself. Purpose has to be much more than a slogan on the wall, in the lobby here. It's gotta be built into the decision rules and the incentives and the protocols that drive the operations and behavior. So it's gotta be aligned with the business model. And so, there's work to do.

Mahan Tavakoli: 

I love that Judy and I actually highlighted and circled page 49, “In all companies, purpose is revealed.” And that is really important to keep in mind because there's been a lot of talk about organizational purpose. About caring about a broader community and impact on society at large. However, the actions haven't followed suit.

So as you say, purpose is revealed through those priorities, through the actions of the organization it's not just in the statements. 

Judy Samuelson: 

Exactly. And we've seen too many examples in the last couple of decades of companies where we learned what their underlying purpose was when the company started to fail. And so, Boeing, of course, still feels like a recent example of that, where it turned out the real purpose was to beat Airbus at any cost and the human tragedy that ensued as a result of taking their eye off of what business they needed to be in to succeed over the long haul.

Wells Fargo has come a long way. It's not like I'm trying to call out companies like that, that I think, but there was a moment in time where we really had to stop and say, wait a minute, it's very clear they're managing to an objective that is not in the interest of their own customers.

And I write about some of these examples to remind us of how important it is that we get this right. But there's also lots of examples of companies that didn't ever make a big deal out of purpose. It was before purpose became purpose. And we're talking about purpose all the time, but these are just companies that were designed with common sense. Southwest, Herb Keller, who really built that company and grew it over many years and the shareholders did very well. Thank you very much. He knew if he wanted to disrupt the airline business and he wanted to do that through support customer service and through making sure that his employees are actually happy and having a lot of fun on the job, he had to put the employee at the center.

You know, planes don't arrive on time unless the employee is happy. And so he naturally built a company that was rooted in the employee experience, which then extends as being the customer's experience. And so, that kind of design is common sense if you're in the service business. So it shouldn't come as a surprise to us. 

There are many companies that have been built around that principle. That one tends to be a standout for me as a great example, but there are others that we could bring to the table as well. Companies like Costco, which has always paid their employees well. It was a competitive advantage for them. So, a lot of companies that have rewarded their employees with stock who have understood this tension And played it to a good end. 

So it's not, again, this isn't rocket science, but in the world of public markets, it means withstanding the pressure that comes from the market, from the investors who are not actually thinking 10, 20, 30 years out, who are trying to extract the value today. And that continues to be a real pressure point. Inside public companies.

Mahan Tavakoli: 

I wonder how that can be done, Judy, with non-founder led organizations, considering the fact that the average tenure of CEOs is a couple of years at most? Their compensation is tied to shareholder returns. They bring in their own senior executive teams, in most instances, compensation tied to shareholder returns. Also with short tenures. So what will it take for non-founder led organizations to be able to make this transition? 

Judy Samuelson: 

Well, I think that statistics of companies, CEO's only being around for an average of three years or something. Of course, there's a lot of CEOs that have much longer tenures and not just founders. So, it's an average, we see it at both ends of the spectrum.

Those pressures are real. We need companies that believe in their long term play, who have committed, who do understand what is absolutely critical and what do they absolutely have to hit out of the park? What do they absolutely need to succeed at in order to build and create value over the long haul?

And so I call out the example of Merck when it was headed up by Roy Vagelos. This is a company that continues to create value, of course, for a lot of people. And it's an important piece of the public health puzzle today as well. But I go back to the example of Roy Vagelos when he was the CEO of Merck, because I learned so much by the example of something that he did that has been written up into a Harvard business case. 

It's about the cure for river blindness. That was a drug that was actually created with a different market in mind, but this ended up becoming an off list benefit. It’s that this drug that I think was designed originally as a heart drug that ended up having cured a disease that is a scourge of, very poor parts of these deep river valleys in Africa where river blindness was a common occurrence. And he asked himself what they needed to do since there would be no revenue associated with bringing the drug to market. And he tried to give the patent away to public entities of various kinds from the UN and the White House and didn't succeed. And his executive team didn't support him. They saw this as a long-term mission for which there shall be no end. And in fact, Merck does continue to produce and distribute Mectizan, the drug that is a cure for river blindness even today. And they're on the path, however, to eliminating that disease. 

So not only did that win him a lot of accolades from people like us that sit outside and praise the company for doing something that courageous, but that's not why he did it. He did it because he knew Merck wouldn't last three years without honoring the scientists who create their drugs. He understood that their scarce resource was that scientific talent. That was at the center. It had to be at the center of their purpose. So if he didn't honor that he was going to miss a much bigger game than whether or not this drug was one that they needed to produce or not.

I learned a lot from talking to him and learning about examples and it really crystallized for me the importance of making sure that, in deriving your goals and your mission, that it's very closely aligned with those things that are absolutely essential to your long term success.

So I think that's a great example of a company that's really designed to support and sustain the kind of leaders that we want to see here. Just see it as a terrific example of purpose at its best.

Mahan Tavakoli: 

It is a beautiful example on so many levels. I found it inspiring both with respect to the impact. But as you said, that is a great way to honor the people at Merck. So it's not just another canned statement about the value of purpose. It's not a canned statement about the value of the scientist. It's showing them through the actions and the investment of the organization that they are valued. That's why it's such a wonderful example. 

Judy, there are people that push back and say, it's great that there are some examples of organizations doing this well, however, we have abdicated our responsibilities with respect to having policies and rules and regulations governing these companies. One of them, Anand Giridharadas talks about this abdication of responsibility. And he says, we can hope and wish for the businesses to self-correct along this purpose and invest in their employees. They won't do it until we mandate it. So what do you think with respect to the role the government needs to play in this? 

Judy Samuelson: 

Well, the government is obviously key to this. Business is also an actor in that system. And so, you still need leaders to try to lean in and balance the need for effective regulation that raises the bar on everybody. 

I love Anand's book. I thought it was a really interesting read. I'm not as cynical about business as he is. And I think it's ignored at your peril or you better have a better system in mind if you're going to proceed. There's a lot of regulatory capture today in businesses playing an unfortunate role in political spending rules work in the way they are today, we've got a problem here. How's it going to get fixed? We have not succeeded at regulating business expenditures. The Supreme court is weighed in a way that I think most of us would have bought as not commonsensical on this.

So what do we do in the meantime? There are any number of cases that we could call out where a business has effectively stepped back and looked at a resource that was at risk and said, if we, as a business community, or we as the leadership of a particular industry, don't collaborate to raise the bar on our industry, we're all going to go down the tube. 

And so I write about examples of fisheries, where the biggest producer has aligned with the biggest consumer. It's often a company, a massive company, like McDonald's and they've played together in order to raise the bar on the industry and assure that the right kinds of protections were put in place to secure the health of the fishery for the long haul.

We have to have business collaborating. Its extraordinary reach. Its global distribution systems, the extraordinary talent and problem solving skills that reside within the private sector. Of course, we need to enlist that. Does that mean we ignore the power of government to regulate and to raise the bar? No. But some of that is happening within industry as well. And we need everybody at the table to see that we advanced the rules that make sense for society in the long haul. 

Business exists at our pleasure. Business corporations are licensed by the state. In the United States that means they're licensed by 50 states. So they're licensed by the state, but corporations were first created to do those things that are hard to do with your own resources or that of your family. Where you need to have an understanding and contracts and relationships and greater complexity in order to tackle things like building the railroads or, opening up new kinds of resources and opportunities.

So that's how we, corporations have always been used and we take for granted a lot of the goods that emanate because of a robust private sector, but of course it's a balancing act.

Mahan Tavakoli: 

That's why simple solutions aren't the answer to it. You need to bring everyone to the table. There is a role for government policy that is not the simple answer. There is a role for the businesses themselves in a thriving marketplace. There is a role for the rest of the community to engage.

You mentioned the fisheries as an example. Are there other examples where this has worked effectively with business, community and government working together to come up with the answer in moving forward? 

Judy Samuelson: 

Well, I don't think there's any problem of scale today in which we can't envision or see the need for more collaboration. And co-creation between companies within industries, across industries, across supply chains, across different sectors, nonprofits as well as governments, as well as the private sector need to work together.

I think one interesting piece of the puzzle that feels pretty new and it's changing pretty rapidly is that from where I sit, and I do write about this, I think it's the employees themselves that have actually become the most important accountability mechanism for companies. It's certainly not investors that come in all shapes and sizes. And yes, we have some that are there at the annual meeting of Exxon throwing out directors who are not moving fast enough on climate. But we also have plenty of shareholders that would be punishing Exxon for moving too quickly. 

So, investors come in lots of different shapes and sizes. And so do consumers. They rebound to price and convenience. Their own needs are what are paramount in the choices they are making. They're not balancing the long term, health of the fisheries or the water systems when they're making their purchases. That's somebody that's way behind the veil. 

But employees are actually very, very aligned with the health of the enterprise itself. They want the same thing the executives do. They want the company to flourish. They know that their own personal financial security is tied to the enterprise. We're seeing employees leave in droves today either for better opportunities or because they've become burned out by the system in which they operate. But they're open to raising the bar within their own enterprises at the same time. And to call the outside in, it just starts to make these connections. I call it accountability from the cafeteria. I think employees are actually a very interesting investment for companies to make, in part, because they opened up the company to all of this complexity. And who are these people that are going to be managing these complex systems? It's the employees who have a deep understanding of the supply chain. It's the employees who can look in and who are monitoring the real status of suppliers and who are doing the work that's involved here.

So, I think it's not just outsiders. It's not just NGOs. It's not just the government. I think we've got an interesting moment. We're trying to figure out how do we really seize the day here. Where there is a new level of accountability, new questions being asked, but the public is pretty clear. They like the private sector's answers. They may not like an individual company or they may want to assign mortality to an individual company. It's good. It's bad. 

Companies are amoral. They 're not moral. They're not immoral. They're a bundle of incentives and rules and regulation and protocols and these decision rules result in good and bad results. Things that we may consider immoral, or that we're not happy with, as the rain played out. But the corporation itself is just a vehicle. It's humans that design the vehicle and decide how it's going to run.

Mahan Tavakoli: 

That's a very empowering part of your book and your message too, Judy, that the employees have the power now to a certain extent to guide the future of their organization. It is not just looking at the CEO and the board of directors. Yes. They also have a responsibility. It is not just looking at the government regulation or whatever else needs to happen, employees have that power.

And to me, that's an empowering message that we can impact the future of our organizations more than ever before, because talent has become a lot more important. As you mentioned in your book also a big part of the valuation of the organizations is no longer those hard assets. It's the intangibles, including the talent that the organization has. 

Judy Samuelson: 

That's right. That's rule number one, it's the intangibles that are really driving business value, but what does that mean? It means trust. Are you building a corporation that is trusted by the customers and by the employees themselves, Yeah. It's about attracting and retaining talent.

That's very much on the lips of executives today. But it's about relationships. It's all about relationships. That's the essence of intangibles. It's about the relationships that reside. It's not about the bricks and mortar and it's not, the stuff that we tried to measure when I was back in business school in the 1980s.

So, that is an important piece of this puzzle. And I think to the extent that that becomes clearer to the executives that have any control at all, you can see the benefit of companies that are publicly traded, but where there's still a controlling interest by the family, Walmart would be an example of that or a Levi-Strauss where there's still a core of long-term interests that's represented by family interests that help balance the more extreme tensions that exist in publicly traded companies without that core. That's resolved in different kinds of companies in different ways, in different parts of the world. Companies that are owned by trusts or companies that are owned by foundations.

So I think we're still experimenting with, the very, the kind of range of different governance structures and innovations that might be possible as we see probably some pretty dramatic changes in boards over this next decade. I think a lot of the boomers are finally going to be moving on. That's going to create a lot of space for boards to be built in a way that is designed to think about the health of the enterprise over the long haul.

Mahan Tavakoli: 

That's an optimistic message as we are going through this change and transition. So Judy, if we have a conversation with each other three to five years from now, and certain measures with respect to business and the real metrics that matter have moved, what will be different from your perspective with the way business will be operating in that future? 

Judy Samuelson: 

I think one thing that I think a lot about is that the companies that are going public today are not all seeking capital. Any number of companies that have gone public in recent years, companies like Spotify and Snapchat, they actually were accessing public markets just to be able to provide their first rounds of investors and exit. They actually didn't need money. They didn't need capital. This is not the era in which those with the largest capitalization are the largest companies with massive continuing requirements for capital, it was the case when GM was at the top of the tables here.

So that in and of itself, as that becomes better understood and realized ought to give executives more room to breathe. We'll see what we continue to design, the rewards for the executive to countermand that basic freedom that they ought to have to be able to build enterprises that are actually consistent with the values of their employees and the communities that hosts them.

No, again, this is not rocket science. These are human designed systems that impede the more natural instincts of managers, executives by and large, they're being paid to get up and care about the stock price all day. And so they do, but I don't think that's why people join and seek the kinds of training they do and pursue the careers that they do initially. I think it's the spirit of creation and the satisfaction that comes with creating goods and services that are valued by the customer. 

Peter Drucker, it's like, what did the company exist to do? It’s about serving people. It's about serving customers. And so I think people are called to that and that's what gets them out of bed in the morning. 

And so I'm hoping that we see some of this reality hit in the next several years. We've seen the fire across the bow or whatever that expression is, when the business roundtable said, we were going to call the game over and restate the purpose of the corporation. The work that has to unwind shareholder primacy is still just beginning. And we've got a lot of work to do there, but there's a lot of people that are working on it.

Mahan Tavakoli: 

That's outstanding, including the work that you have done on it and you continue to do on it Judy. In addition to your own book, The Six New Rules of Business, what other resources or practices do you typically find yourself recommending to leaders as they want to guide their organizations to create more value in this changing world? 

Judy Samuelson: 

I found I've been relying a lot on reading history in the last year and a half. It gives me the confidence that we've been at. There's been a lot of things that we've weathered over the long haul. 

Look, I'm not saying when about where we're headed. I don't think this is easy. I don't think it's a win-win world. I think there's winners and losers. And we've got to build a system that works for more people. I'm deeply concerned about the health of our democracy, as I think many of your listeners probably are. And I think business has a role to play here. Not just in the sense of signing on to statements like the one on my wall that I took out in the New York times and we had all these people sign on that we stand for democracy, but what are the things that need to work well inside the company? What are we building the enterprise to do? And so I tried to read widely. I try to read history. I find it's really important to be able to step away from work every day and do something different. For me, that's getting outside and making sure I have, daily dose of exercise and it's pretty cold out there today. I must say that keeps my head clear. And so that's probably my most abiding habit that I have been at for longer than I want to report. 

I got lucky on that, that I started building habits on that when I was young and have stayed at it. Meditation comes and goes, I believe in it. But I think it's about reading widely, giving you an opportunity to step back and think about things through the course of a story that maybe helps you see the kind of patterns and things that help feed your brain in a healthy way. So, it could be any kind of activity, whether it's painting or listening to music, but to step back from the fray and give time to reflect and process what we're hearing. 

That's very much at the design of the fellowship program, we run for what we call first movers. People who are driving change from within. We teach the habits of reflection and we use poetry to do that and create constructs for people to learn the habit of stepping back and observing what's going on and not just reacting to it. I'm not good enough at it. I react too quickly, often. And that's something I'm working on in 2022.

Mahan Tavakoli: 

I really liked the point that you make, Judy. And that for us in a chaotic external environment, first we have to center ourselves before then we can have an impact on the environment, whether it is the organizations we guide or the people we interact with. I've really appreciated reading your book, The Six New Rules of Business, especially, because you provide a framework on how business can be a vehicle for change, and really appreciate you saying that a business can be a remarkable vehicle for change.

But we can't have a thriving business in this failed society. So we have to be mindful of how we operate our businesses in order for more of our communities and people to thrive in society. I appreciate all you have done and continue to do to help that materialize. Thank you so much, Judy Samuelson. 

Judy Samuelson: 

Thank you so much for having me. I've enjoyed the conversation.