At an investor's conference on Friday, something unusual happened: Apple CEO Tim Cook got angry at his shareholders.
Not all of them, mind you — just a select minority that said Apple should avoid investing in green technology. According to multiple media accounts, Cook grew visibly upset when the National Center for Public Policy Research — a D.C.-based, conservative think tank — challenged Apple's effort to use renewable energy. A NCPPR official then demanded that Apple only pursue projects that will add to the company's bottom line.
Cook replied testily, telling NCPPR's Justin Danhof that he sees the business as more than a money-making machine. As the MacObserver's Bryan Chaffin wrote after watching the event, Cook was as angry as he'd ever been in public.
"When we work on making our devices accessible by the blind," said Cook, "I don't consider the bloody ROI."
Cook went on to suggest that perhaps Danhof should "get out of this stock" entirely. The tense exchange came weeks after NCPPR made a proposal to the board asking Apple to publish an annual report detailing its relationship with sustainability groups. The measure failed by a wide margin.
"The proposal alleges that some trade associations are lobbying business executives to pursue objectives with primarily social benefits," the board responded in a federal filing. "This is not consistent with the company’s experience."
Apple has a history of pursuing sustainable practices that includes greening its facilities, publishing environmental impact estimates for each of its products and eliminating toxic substances from its devices. But Cook's outburst is an emotional example of the way some businesses are finding it easier to resist the corporate orthodoxy espousing shareholder welfare.
Investing in "moonshot" projects is sexier than ever, thanks in part to companies like Google that have poured millions into research with only a passing relevance to its existing business. Its work on driverless cars promises to change the face of transit, trucking and even how future cities will be built. Project Loon, its attempt to provide low-cost Internet access to underserved areas with giant balloons, sounds equally fantastical but could get countless people connected to information.
This week, TechCrunch reported that Facebook has its own version of Project Loon in the works. The plan relies on self-sustaining drones that can hover in the air for as long as five years, beaming Web connectivity down to Earth. Facebook hasn't publicly confirmed the program. But it would fit neatly into an initiative by CEO Mark Zuckerberg to make Internet access more affordable for developing countries.
Closer to home, the cable company Comcast has vowed to extend its $10-a-month broadband program to low-income Americans "indefinitely," on the heels of a White House push to improve broadband access nationwide. Comcast's Internet Essentials program has connected some 300,000 families with kids on free or subsidized school lunches to the Web at speeds of 5 Mbps.
Of course, companies rarely do anything that's not in their ultimate interest. Comcast is currently trying to convince regulators to let it acquire Time Warner Cable. Google and Facebook both benefit directly by getting people hooked on the Internet and its attendant services. Apple's sustainability record helps mitigate a mixed report card on labor issues, and it sits on a huge pile of cash, so it could still afford to do more. "What's in it for me?" is a defining feature of the corporate landscape. It'd be naive to ignore it.
Maximizing shareholder value became an American mantra only recently — the result of free-market economists like Milton Friedman, whose message identifying the enlargement of profits as a business's only social responsibility rallied business leaders in the 1970s. What made it so attractive? For one thing, it was a seductively short description of what a company was for, according to Harvard Business Review executive editor Justin Fox. The feeling was only reinforced when executive pay became tied to share prices.
To some, Wall Street's devotion to profit has been a self-defeating impulse.
"The shift in what employers think of as their role not just in the community but [relative] to their workforce is quite radical," Ron Hira, an assistant professor of public policy at the Rochester Institute of Technology, told my colleague Jia Lynn Yang in August. "And I think it has led to the last two jobless recoveries.” (I'll pause here to say that you should really read the whole piece. It's a great look at how we got to where we are.)
It's too early to say whether the recession has really changed anyone's minds in the boardroom. But amid the populist backlash against Wall Street, it's become a lot safer for executives to make what might have been unpopular business decisions just a few years ago.