Businesses should relish the opportunity to play a role in the societal and cultural shifts in our country, according to Cascade Engineering Chairman Fred Keller.
Keller was on hand at a recent Rotary Club of Grand Rapids meeting to discuss business-inspired community change, an ideology rooted in the critical role of businesses to take active interest in improving the communities they serve. In his presentation, Keller used real-world examples from companies successfully practicing business-inspired community change, including Cascade Engineering.
“We need to own our problems in community,” Keller said. “We have a narrative going on in this country that, if only we have the right person or the right party in the state house, we’d be OK. And I’d like to flip that around, because we really need to be able to understand and own our own problems to be able to inform state and national policy of what works.”
Keller began by running through a brief history of how the United States measures poverty. Developed by economist Mollie Orshansky in 1963, the U.S. government still measures poverty by the Orshansky Poverty Threshold, calculated using the cost of a healthy diet as the basis for determining whether a family falls below the poverty line.
Using the Orshansky model, the U.S. Census in 2014 said 14.8 percent of the country is living in poverty, which Keller said has been viewed as “de minimis.” However, under a supplemental metric that takes into account more factors — including the cost of child care, health care and housing — the poverty line in Michigan goes from the $24,250 level reported by the feds to about $47,000 for a family of four. Using that number as a base, about 41.2 percent of families in Michigan do not meet a minimum survival budget, Keller said.
“Our system is not working well for everybody,” he said.
Keller said there is a mentality at work that sees issues like poverty sorted into a pile that should be best addressed by a network of nonprofits created specifically to address social issues. He suggests businesses challenge that mentality head on by shouldering some of that responsibility.
“We’ve built wonderful nonprofits around the country and world that work on that pile, and we seem to be OK with what we’re doing — business is business and someone else can work on the other side,” Keller said. “But we in business have a choice to participate in not letting that pile get so high.”
In demonstrating how capitalism is viewed, Keller cited the perspectives of “influential leaders” Milton Friedman and Ayn Rand as two primary factors for shaping the cultural view of capitalism. The Friedman doctrine argues that a business’ sole social responsibility is to its shareholders, while Rand’s “Atlas Shrugged” hero John Galt is exalted for his ability to maximize profits by any means necessary. Keller said that while these two narratives can be debated, at the basic level, it is important to understand how they have and continue to shape our perspective on capitalism.
The tremendous pressures facing the country today should provoke some shifts in the way business leaders view their role in society, Keller said.
“Those pressures on us are enormous, so the idea that we can solve tomorrow’s problems with yesterday’s solutions doesn’t bear weight, in my mind,” he said.
Keller cited several ways in which Cascade Engineering has worked to build a foundation on social responsibility, including its initiative to hire former prisoners, certification as a B Corp and anti-racism efforts. He ended his presentation by calling for business leaders to look at their own practices in working to find solutions to the issues facing society today.
“There are business models to solving our problems,” Keller said. “The key question you have to ask is, ‘How do you find something that’s good to do for society and make it good for business?’ That’s tough. But it is possible.”