October 2, 2020
BY EMAIL
The Honorable Elizabeth Warren
United States Senate
309 Hart Senate Office Building
Washington, DC 20510
Dear Senator Warren,
Thank you for your inquiry regarding the Business Roundtable Statement on the Purpose of a Corporation. We continue to welcome the opportunity to engage with you and other members of Congress on this important issue. We remain steadfast in our commitment to promote a free market economy that serves all Americans, and leading our companies for the benefit of all of our stakeholders is a core component of that effort.
Last year, Business Roundtable CEOs updated our principles on the role of a corporation. In place of a prior statement defining a corporation’s principal purpose as maximizing shareholder return, the CEOs of Business Roundtable adopted a new Statement declaring that companies should serve not only their shareholders but also deliver value to their customers, invest in employees, deal fairly with suppliers and support the communities in which they operate. Through a year of unprecedented crisis, Business Roundtable CEOs have demonstrated their commitment. From prioritizing the health and safety of our employees and customers to reshaping our businesses to become as equitable and inclusive as possible, Business Roundtable CEOs have risen to the challenge.
Even before the pandemic hit, many Business Roundtable companies were making substantial investments in worker training, increased wages, expanded benefits and support for struggling communities. For example, Walmart expanded its debt-free, $1-a-day college program – Live Better U – providing all U.S.-based associates access to associate’s and bachelor’s degrees in an increasing variety of areas. As of last year, some 12,000 associates have completed 88,000 course credits, which have a total worth of more than $42 million.
Our fellow CEOs have likewise acted on their commitments. Accenture announced a national apprentice program to create new career pathways for non-traditional hires. Chipotle expanded education benefits to cover 100 percent of tuition costs up-front for employees. Union Pacific launched a university partnership to allow employees to register for classes tuition-free. Home Depot employees can receive a share of the company’s profits. Best Buy now offers subsidized backup childcare for employees. These are just a few specific examples, with many more available at www.brt.org/purpose.
Faced with the COVID-19 pandemic, companies have raised wages and delivered bonuses to frontline workers and have prioritized the health and safety of their employees and customers. Many are giving generously to support their communities and have retooled operations to fill critical medical supply shortages. Walmart paid $1.1 billion in bonuses to their frontline associates, in addition to the regular incentives provided to frontline associates on a quarterly basis. General Motors retooled its manufacturing line to use sonic welders previously used for Chevrolet Volt’s battery packs to create weld patterns needed for respirators. GE Healthcare partnered with the Ford Motor Company to produce 50,000 ventilators within 100 days and up to 30,000 per month as needed. Ford overhauled its manufacturing capacity to quickly scale production, and GE Healthcare provided its clinical expertise. Duke Energy and Edison International expanded assistance for customers who have experienced difficulty paying their bills, including no service disconnections for nonpayment. New York Life and Cigna launched the “Brave of Heart Fund” to raise more than $100 million to provide financial and emotional support for families of frontline healthcare workers and volunteers. Bank of America announced a $1 billion, four-year commitment to support new economic opportunity initiatives to help local communities address economic and racial disparities accelerated by the pandemic. Bank of America also raised its minimum wage to $20 per hour and provided over 1 million cumulative days of childcare for employees at $100 per day to assist parents throughout the pandemic.
In the first months of the pandemic, JPMorgan Chase & Co. approved more than $45 billion in new credit for their clients impacted by COVID-19. This included more than $6 billion to hospitals and healthcare companies, educational institutions, nonprofits and state and local governments. Additionally, during the first 60 days of the crisis, JPMorgan Chase & Co. extended $950 million in new loans for their small business clients, such as Kids Klub Child Development Centers, which offer preschool, daycare and after school programming. The bank has pledged $200 million to help underserved small businesses and nonprofits access low-cost capital through community partners and $50 million in philanthropic investments to help address immediate and long-term impacts of COVID-19.
Beyond corporate commitments and actions, CEOs are pressing policymakers to find common ground on issues important to their stakeholders. We have called for an increase in the federal minimum wage and for guaranteed paid family and medical leave. We have called on Congress to adopt comprehensive reforms to higher education, including expanded access to federal financial aid. And in recent weeks, Business Roundtable CEOs released new principles and policies to address climate change, including the use of a market-based strategy that includes a price on carbon where feasible and effective.
Business Roundtable CEOs have also called on Congress to provide direct payments to individuals in need and supported continued unemployment insurance, along with more financial support for hard-hit small and medium-sized businesses. We continue to call on Congress and the Administration to reach bipartisan agreement, as the need for relief remains critical.
As our country also navigates the latest chapter in our crisis of racial inequity, Business Roundtable CEOs have stepped up to take action. As just one example, Walmart and the Walmart Foundation are committing $100 million to support philanthropic initiatives beyond the company to advance racial equity in our nation’s financial, healthcare, education and workforce and criminal justice systems. Business Roundtable CEOs have further called for necessary policing reforms to strengthen communities and address racial injustice. CEOs are actively identifying actions companies can take and policies elected officials can implement to improve equity in education, health, finance and justice. We know there is more work to be done, and Business Roundtable CEOs will do their part to ensure inclusive long-term growth that provides economic opportunity to all Americans.
When we issued the Statement on the Purpose of a Corporation, we said, “We have not called for, and do not support, radical changes to corporate governance structures, which could have serious unintended consequences.” In a previous letter, we shared with you our opposition to the Accountable Capitalism Act. We believe that prescriptive government control over businesses would end up hurting many of the stakeholders we all want to help. Given your press statements, we understand that you may deem inadequate any of our efforts to support our employees, customers, suppliers and communities that fall short of endorsing your legislation. But we do not believe an endorsement of your legislation is the measure of whether we have kept our commitment to create value for all of our stakeholders. Our companies’ actions speak for themselves. After one year, including through a period of challenges unimaginable in 2019, companies have demonstrated a commitment to the values embedded in the Statement. We have made progress, and we remain committed to our efforts to address the biggest challenges facing our employees and customers, along with the communities we serve.
We look forward to engaging with you and your staff on these important issues.
Sincerely,
Doug McMillon
President and Chief Executive Officer
Walmart
Joshua Bolten
President & CEO
Business Roundtable