A capitalist conscience sounds like an oxymoron. After all, the intent of the sector is profits. An entrepreneur makes, markets, and sells what customers want. Sometimes the savvy entrepreneur manipulates demand, convincing would-be customers to want the item — remember beanie babies, Pokemon cards, fin-shaped cars. “Need” and “want” merge.
Those profits are not intrinsically evil: they buoy pension funds, savings accounts, mortgages. They pay salaries not just of the MBAs at the helm, but the workers down the ladder; they support related industries, from transportation to advertising to manufacturing to real estate. We need this sector.
Yet what if the sector opts to make a move spurred not by profits, not by the reading of consumer “wants,” but by public health? What if a faceless corporate structure, which reports to stockholders, develops a conscience?
More specifically, does a firm that stops selling cigarettes, or guns, watch their bottom lines plummet as the sales of those very consumable items plummet? Can corporations make money from decisions that favor the public’s well-being?
Cigarettes and CVS are a case in point. Government regulations had banned the sale of cigarettes to minors, but the market among adults, or minors with sketchy IDs, was robust. For decades the public health gurus had preached the dangers of cigarettes, including the dangers of second-hand smoke. And for decades stores sold cigarettes, often behind the counter.
CVS has not been the poster child for health: the opioid lawsuits still clog the courts. But in 2014 the megalith decided: no more sales of cigarettes. What happened?
Initially CVS lost money, as predicted. But afterward CVS morphed into a “wellness company,” with minute clinics, on-site vaccination, on-site COVID testing, and pharmacies which expanded to delivery. On the one hand, it was ludicrous for a company that sold prescription inhalers for asthma, to sell, in the same store, maybe the same aisle, cigarettes. But life abounds with ludicrous mismatches.
The market for guns is similarly robust; but the decades of massacres have prompted not just an analysis of the the deranged psyches of the shooters- where they grew up, their friends, their families, their alienation, but the ease with which they got hold of the guns. We have learned where/how/when the shooter bought the guns. But jarring publicity did not in and of itself deter stores from selling guns
For the Ed Stack, the owner of the 850-chain Dick’s Sporting Goods, the massacres prompted a gradual rethinking of the corporate strategy. After the 2012 Sandy Hook massacre, Dick’s stopped selling assault rifles: those were not the guns-of-choice for sports enthusiasts and hunters. By 2018, the shooting at a high school in Parkland, Florida, prompted a conscience-decision. The Parkland shooter had bought a shotgun (not the automatic rifle he wielded at Parkland) at a Dick’s. Ed Stack owned guns, supported gun “rights” legislation. Had the easy sale of guns enabled deranged people to turn into mass murderers? Maybe. Should Dick’s ban the sale of certain kinds of guns and ammunition?
It decided on a ban.
Predictably, gun-enthusiasts, including the National Rifle Association, complained, threatening a boycott. But Wall Street, which cared about the bottom line, was not so alarmed.
Harvard Business School Professor George Riedel looked at Dick’s decision in two case studies: (https://hbswk.hbs.edu/item/dicks-sporting-goods-followed-its-conscience-on-guns-and-it-paid-off). Corporate analysts predicted the company would lose as much as $250 million. But over time, this move proved profitable. Dick’s expanded to more items, reached more customers. Dick’s is not alone. The Kroger-owned Fred Meyer chain also stopped selling guns. Walmart has cut back its sale of guns.
Americans still smoke. If every pharmacy in America stopped selling cigarettes, addicted smokers would still fill their lungs. Ditto for guns. Shooters can find guns legally and illegally, but maybe not quite so easily as before.
CVS and DIck’s, though, demonstrate that a corporate conscience is not an oxymoron.
Joan Retsinas is a sociologist who writes about health care in Providence, R.I. Email retsinas@verizon.net.
From The Progressive Populist, June 1, 2022
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