The chair of PwC U.S. says CEOs can’t shrink from addressing the biggest social challenges facing us today. And he offers advice to the incoming U.S. president.
Tim Ryan, the chair of PwC U.S., believes that CEOs must play a role in addressing society’s inequities. He has repeatedly called on leaders to fight for racial justice and to diversify the ranks of their own organization. In 2017, he launched CEO Action for Diversity and Inclusion, whose 1,600 signatories work together on public policy solutions to the big challenges around public health, public safety, education.
Days after a mob laid siege to the U.S. Capitol, he spoke with HBR about what CEOs can do bridge the divides that threaten the government.
What’s the role of a corporate leader in a moment like this — to employees, customers, partners, and to the community at large?
The CEO’s job has evolved. Ten or 15 years ago, the CEO had three basic stakeholders: shareholders, employees, and customers. That has changed drastically and we’re seeing that change before our eyes. The CEO’s responsibility still includes those stakeholders but it extends much further—to society and to communities, and to business. CEOs today are trying to strike the right balance, meeting the needs of all those stakeholders, while sticking to a certain set of values.
There’s very little good news coming out of this pandemic, but one thing I see is that business has gained trust. I am very encouraged by how business has responded over the last 10 months, caring for employees and doing more in the communities than I’ve ever seen before. This goes beyond good deeds. There’s been a void in certain parts of government and business has worked to fill that. The CEOs I work with feel a tremendous sense of responsibility to help employees.
They understand that they’ve got to be engaged in their employees’ whole lives, not just the eight hours a day they’re putting in at work. We saw that particularly with George Floyd in May, where CEOs stepped up to condemn the murder. They knew this affected employees, even though it happened outside the workplace, and they made commitments at record levels to do more for racial equity inside their companies and in their communities. Now we’re seeing it again with the violence on Capitol Hill. Those CEOs have come to the appreciation that in order to win the hearts and minds of employees and fulfill the values of their organizations, they have to lean in.
As a leader of an organization with a lot of different clients, a lot of employees, how do you think about what went on at the Capitol?
On January 6, the violence in Washington, DC, had been going on for about an hour when were about to start our regular monthly all-staff webcast. We had been planning to give our six-month update on diversity — our progress and areas of improvement. We had other business topics, but that was the centerpiece of the webcast. But here we are an hour into the invasion of the Capitol, and we’re asking ourselves, what do we do? We debated, and we decided to go ahead with it, because we didn’t want that violence to take away from the important topic of diversity.
At the beginning of the webcast, I explained why we were going ahead with it, but told everyone that if they were having trouble focusing, they shouldn’t feel they have to watch. I spent the first 10 or so minutes talking about Capitol Hill as it was playing out in front of us. The first thing I said is, no matter what your views are, this is wrong. We do not condone violence. We do not condone going against the Constitution of the United States. It is important for me, as a leader, to tie things back to our values. And our values are about caring and collaboration, not unlawful violence. And so, I was very clear about that.
I realize our firm, like our country, has many different views politically. It’s not my job to tell people what their politics should be. It is my job to make sure the values of PwC are lived by all of our people. And that’s where I try to stick: to the values of our firm.
A number of organizations are withdrawing financial support from Republicans or from legislators who argued to overturn the vote. What do you think of that, given what you just said?
I believe we are in an age where organizations are going to be challenged on every dimension of trust. Are you as diverse as you should be? Do you pay your fair share of taxes? Do you protect and use customer data the right way? Are you doing your fair share around ESG? Are you using customer data fairly and securely? The list goes on.
I don’t view moves around political contributions as a one-off. I view them as a response to the challenge of demonstrating that you are trustworthy. Are you doing what you say you do?
Events like the attack on the Capital — these are the types of things that will define capitalism. I think the more business can anticipate trouble and lead the fight against inequity and other deep-seated societal problems, that’s where you really begin to earn trust.
Frankly, it’s easy to react. If something happens, we’ll do something. It’s a lot harder to anticipate and try to prevent something from happening. That’s where I think we’re going: Can we as a group of CEOs help prevent bad things from happening?
This gets to a fundamental question: Do we have the right mindset as leaders to make sure we’re trustworthy? Not just on general business and the bottom line, but on these urgent social issues, because they’re important to our employees, customers, and community.
So, with that in mind, the partners of PwC have committed to examining the strategy of our political action committee (PAC) and decided to suspend political contributions to any member of Congress who objected to the certification of the election. We will continue to make political donations to people on both sides of the aisle who support our values and our purpose.
How will we know if CEOs are leaning in, if they’re working to prevent the next crisis? What should we looking for?
I think we’re going into the great age of transparency, way beyond financials. You’re going to see more and more companies reporting out on ESG to demonstrate that they are trustworthy, that they are doing their part. In fact, transparency has become a very important boardroom topic — how transparent are we about data privacy, diversity, environment, net zero? That’s how we’ll know what’s happening inside the four walls of these organizations. That’s when then society will judge be able to judge whether we are doing enough.
So, you’re in the advice-giving business and we have a new leader coming into the White House. What’s your advice for Joe Biden as he takes office amidst all this tumult?
First, I would ask that he focus on putting this pandemic behind us. If we have to take our lumps in the short term, we need to do that. But we’ve got to put safety of Americans first, and we’ve got to help the small business community get out from under the real challenges that it has faced.
Then I would ask that he focus on a small number of things. We know that if you, as a CEO, try to take on too many things, you fail. History, both in business and politics, is littered with the failures of very aggressive, well-intended agendas that ultimately didn’t get anything done. I suggest prioritizing the three or four things that are most important to our country, and I assume he’ll put the pandemic first. I think eliminating the divisiveness is another one. And then I’d pick one or two more and I’d drive those home.
Our country is one leader away from coming together. One leader. I’d encourage him to be that leader. I truly believe people want to be inspired. There’s millions and millions of Americans who are struggling and have struggled for a long time. We need to be empathetic to that. I don’t care whether they’re Republican or Democrats. We have a responsibility to help them as citizens. We need to be pulled together as a nation and to work together to deal with the biggest challenges we’re facing. We need the president to be that leader.