By James O'Toole
In The Enlightened Capitalists an expert on ethical leadership analyzes the complicated history of business people who tried to marry the pursuit of profits with virtuous organizational practices — from British industrialist Robert Owen to American retailer John Cash Penney and jeans maker Levi Strauss to such modern-day entrepreneurs Anita Roddick and Tom Chappell.
Today’s business leaders are increasingly pressured by citizens, consumers, and government officials to address urgent social and environmental issues. Although some corporate executives remain deaf to such calls, over the last two centuries, a handful of business leaders in America and Britain have attempted to create business organizations that were both profitable and socially responsible.
In The Enlightened Capitalists, James O’Toole tells the largely forgotten stories of men and women who adopted forward-thinking business practices designed to serve the needs of their employees, customers, communities, and the natural environment. They wanted to prove that executives didn’t have to make trade-offs between profit and virtue.
Combining a wealth of research and vivid storytelling, O’Toole brings life to historical figures like William Lever, the inventor of bar soap who created the most profitable company in Britain and used his money to greatly improve the lives of his workers and their families. Eventually, he lost control of the company to creditors who promptly terminated the enlightened practices he had initiated—the fate of many idealistic capitalists.
As a new generation attempts to address social problems through enlightened organizational leadership, O’Toole explores a major question being posed today in Britain and America: Are virtuous corporate practices compatible with shareholder capitalism?
Publisher: Harper Collins
Roger Lowenstein on The Wall Street Journal wrote:
"The Enlightened Capitalists is a fat book about people many of us might regard as fat cats: people who made — and in some cases lost — a lot of money in business but stood out because they also tried to 'do good while they did well'. James O’Toole [...] has been studying these business outliers for some 50 years and this enormous but accessible book is the result. By his definition, an enlightened capitalist seeks 'to address social problems primarily through their business practices, rather than by acts of charity or philanthropy'. [...] O’Toole demonstrates how centuries may pass but enlightened capitalists face the same problems. [...] Overall, the re-telling — reviving, really — of so many corporate lives acts as a tonic for any reader tired of hearing about the exciting world and devilish dominance of Big Tech. O’Toole takes us back to explore the work and legacies of the behemoths of the manufacturing past, many of them almost forgotten. The primary audience for the book is likely to be business school students and management specialists, although the former group will find a depressingly large number of examples of men with MBAs who were brought into enlightened companies when the original visionary leader had been sidelined or driven out. Because business schools taught these graduates to pursue short-sighted and profit-driven management strategies, they ended up ruining companies that were perfectly good — in all senses. [...] The final chapters cover 'capitalists of a different stripe', including family holdings [...], worker-owned enterprises [...]; and co-operatives. These, and more modern company set-ups, including for-profit social enterprises, seem to offer hope for those in search of models of kinder capitalism that can outlast their founders’ vision. But they remain outside the mainstream. [...] The central question O’Toole asks at the start of the book — and returns to frequently — is: 'Are socially virtuous business practices compatible with shareholder capitalism?' While many of his profiles are “cautionary tales”, he sees reasons for hope."
Ilse Oosterlaken on Moral Markets wrote:
"Mr. O'Toole's exemplar is Robert Owen, the 19th-century textile manufacturer. No one accomplished more social good -- for a while -- or saw his hopes so cruelly dashed. [...] The subsequent stories in Mr. O'Toole's admiring but unflinching survey, plucked from England and America over the past two centuries, often inspire, even if few of the successes endured. [...] Though most of Mr. O'Toole's capitalists thought of themselves as free-market conservatives, they generally despised Wall Street for its short-term focus and pinched definition of success. They didn't worship profit per se, regarding business as a social enterprise that, if conducted properly, would yield profits over the long haul. [...] Mr. O'Toole is careful not to claim too much. He notes that the commitment to ideals has often lapsed after the founder departed or the family ownership changed. Attempts to perpetuate morality through lasting trusteeships have risked creating managerial straitjackets. Many of his renegade entrepreneurs, such as Ben & Jerry's, of Vermont ice-cream fame, or Tom's of Maine, an eco-sensitive toothpaste maker, sold out to global corporations. But even if idealism is transient, Mr. O'Toole has made a strong case that enlightened stewardship is in the interest of stockholders. In setting out to write a brief for social responsibility, he has delivered some managerial wisdom. Humanity in the corner office need not be altruistic; it may simply be good business."
The Enlightened Capitalists [...] discusses the life, ideas and work of about 30 American and European “enlightened capitalists” in historical order. [...] O’Toole hopes that today’s leaders will learn from the examples in the book. The depth of his stories will certainly contribute to that [...] Although each and everyone of the stories is interesting and keeps you hooked as a reader, the book starts to become a bit ‘too much of a good thing’ at some point in the more than 500 pages. It lends itself better to reading a single story now and then, giving yourself some time to process, than to reading it fully in one go. In three closing chapters, O’Toole reflects on what we can learn from his historical cases and looks ahead to the future of capitalism. [...] These reflections – and his critical comments on some of the positive trends he also identifies, such as the rise of the ‘Conscious Capitalism’ movement – make the closing chapters of the book unfortunately quite pessimistic."
- 50-minute podcast with James O'Toole about the book by Marc C. Crowley, author of the book Lead from the Heart
Table of Contents of The Enlightened Capitalist
- Preface: The Good Unearthed Introduction and Background: Why It Is Hard to Do Good
Part I: The Pioneers
- The First Business Reformer: Robert Owen (1771-1858)
- Man with a Thousand Partners: James Cash Penney (1875-1971)
- The Businessman Who "Cleaned Up the World": William Lever (1851-1925)
- Kisses Sweeter Than Wine: Milton Snavely Hershey (1857-1945)
- Creating an Enduring Enterprise: James Lincoln (1883-1965)
- New Forms of Incorporation and Governance: John Spedan Lewis (1885-1963) and John Joseph Eagan (1870-1924)
- Johnson & Johnson's Roller-Coaster Ride: Robert Wood Johnson (1893-1968) and James Burke (1925-2012)
- Great Genes: Levi Strauss (1829-1902) and His Heirs
- Marks & Sparks: Michael Marks (1863-1900) and the Marks and Sieff Families
Part II: The Golden Era
- Leadership as an Art: Max De Pree (1924-2017)
- Too Much of a Good Thing: Willian C. Norris (1911-2006)
- Business Mavericks: Ken Iverson (1925-2002), Robert Townsend (1920-1998), Herb Kelleher (1931-), Bill Gore (1912-1986), and Terri Kelly (1963-)
- The Patricians: Thornton Bradshaw (1917-1988), J. Irwon Miller (1909-2004), Edwin and (1909-1991), John Whitehead (1922-2015), and Roy Vagelos (1929-)
- Environmentalist or Capitalists? Anita Perella Roddick (1942-2007) and Tom Chappell (1943-)
- Lever Redux: Ben Cohen (1951-)
- Capitalist of a Different Stripe: Yvon Chouinard (1938-), Jack Stack (1949-), Robert Beyster (1924-2014)m and Others
Part III: Yesterday, Today and Tomorrow
- Looking Back: What We Have Learned
- Looking Forward: The Prospects for Enlightened Corporate Leadership
- Conclusion: Difficile Est Bonum Esse
About James O'Toole
James O’Toole is the author of seventeen books, including Work in America and Vanguard Management. Professor Emeritus at the University of Southern California’s Marshall School of Business, and Founding Director of the Neely Center for Ethical Leadership. While at USC, he held the University Associates’ Chair of Management, served as Executive Director of the Leadership Institute, and editor of New Management magazine.