The average annual pay of a chief executive officer (CEO) in the Philippines is P2,200,000. This is in stark contrast to the annual income of around P169,000 that a minimum wage earner in Metro Manila lives on. Globally, companies with the largest CEO-worker pay gaps include Disney at 367:1 and 21st Century Fox at 311:1. On a more positive light, new data reveal that the 20 companies with the lowest CEO-worker pay gaps include Facebook (CEO Mark Zuckerberg) at 37:1 and, topping the list, Berkshire Hathaway (CEO Warren Buffett) at 2:1.
While data on the CEO-worker pay gap have been analyzed from various perspectives, it is most appropriate, in this month of hearts, to view an old scenario through the lens of love. As a business executive or student, how would you address the perennial inequity created by huge pay gaps and contractualization in your company? How can you inspire the ideal of unity instead of creating divides in your organization?
We can draw inspiration from Zuckerberg and Buffett. Both are listed among Forbes billionaires, yet mentions of monetary pay is not among their famous quotes. While much of what they share about their successes pertain to business practices, both CEOs are also imbued with a mission for the world and humanity. They see beyond themselves and their companies into their society and the world. Their management is marked by a passion for their work and care for people.
Zuckerberg shared, “The question I ask myself like everyday is, ‘Am I doing the most important thing I could be doing?’… Unless I feel like I’m working on the most important problem that I can help with, then I’m not going to feel good about how I’m spending my time.” Despite all the criticism that his company has been dealing with, Zuckerberg believes in connecting people and giving them access to information that could help them: “Instead of building walls, we can help build bridges.”
Buffett, CEO of Berkshire Hathaway, which holds 60 companies, believes that success is not measured by a price tag or figure. Rather, he says, “I measure success by how many people love me.” Moreover, his philosophy of wealth is not about acquisition; rather, it centers on distribution. He believes in giving to the less fortunate. “If you’re in the luckiest 1% of humanity, you owe it to the rest of humanity to think about the other 99%,” he shares.
The management philosophies and practices of at least some of the most successful CEOs espouse that wealth should be used to achieve a world vision and mission as opposed to being merely for personal gain. One of the best responses to social inequities perpetuated by age-old corporate ill practices is the emergence of social enterprises. Kikcul and Lyons (2012) provide a definition of social enterprises that is akin to management with love: “Put very simply, social entrepreneurship is the application of the mindset, processes, tools, and techniques of business entrepreneurship to the pursuit of a social and/or environmental mission. Thus, social entrepreneurship brings to bear the passion, ingenuity and innovativeness, perseverance, planning, bootstrapping abilities, and focus on growth characteristic of business entrepreneurs on the work of meeting our society’s most pressing challenges.”
We are familiar with social entrepreneurs Tony Meloto (Gawad Kalinga and GK Enchanted Farm), Camille Meloto and Anna Meloto-Wilk (Human Nature), and Krie Lopez (Messy Bessy). Thankfully, they have been joined by other actors in the market.
Len Cabili of Filip + Inna works with embroiderers, weavers, appliquers, and beaders from different Filipino tribes: Ga’dang from the Mountain Province, Tinguian from Abra, Ilongot from Aurora, Ifugao from Kalinga, embroiderers from Lumban and Taal, and Mangyan from Mindoro. Bea Misa-Crisostomo of Ritual, together with her husband Rob, operates a general store that stocks bath and beauty products as well as cooking ingredients sourced from small-scale farmers. Michael Harris Conlin of Foundation for Sustainable Coffee Excellence helps La Trinidad farmers in Benguet with his The Giving Café, a selling space and café. There are other inspiring stories of businesses with a social mission.
The emergence of social enterprises potentially sets a new trend toward more socially responsible and equitable management practices in local enterprises. Social enterprises are especially important because despite the rapid economic growth, the 2015 poverty rate was still significant at 21.6%. Cuevas (2017) wrote in Rappler that more than two-thirds (68%) of the social enterprises target solving the lack of jobs. Poverty alleviation, local development, and the empowerment of marginalized sectors are also top advocacies.
This is business with a heart. This is management with love.
Angelina G. Golamco is a part-time faculty member of the Management and Organization Department, Ramon V. del Rosario College of Business, De La Salle University.