Rich pickings

Apple CEO Tim Cook.

Activist CEOs should stick to delivering shareholder returns and leave important policy decisions to elected officials. By Nick Cater.

It is hard work being a titan like Tim Cook, CEO of Apple, whose stern face graces the cover of a special edition of Time magazine listing the 100 most influential people in the world for 2022. Cook’s citation was written by Laurene Powell-Jobs, widow of Apple founder Steve Jobs. Cook, she writes, is “not only one of the world’s most admired CEOs but an exemplar of moral leadership”. The pressure of taking responsibility for the company’s effects on society “is almost unimaginable” yet “Tim strives valiantly, dares greatly, and spends himself in a grand cause”. He also took home $US99m in remuneration last year, but that’s incidental.

The woke industrial complex has become a force to be reckoned with. Gone are the days when a corporate executive could be judged by the size of the smiles on the faces of shareholders. Today, CEOs rival presidents and popes as the leading political and moral arbiters in society, rivalling popularly elected governments in their power to decide important policy questions. They claim authority not because they have bigger brains and hearts than the rest of us but because stakeholder capitalism has become the governing philosophy for big business in the West. It operates under what reformed woke capitalist Vivek Ramaswamy calls the Goldman Rule: the people with the gold get to make the rules, not just in the market but in the wider world too.

Australia’s single representative on Time’s list of uber-influence peddlers has not earned his position by winning MasterChef, leading the Australian cricket team or any other feat worthy of popular acclaim, let alone winning an election. Mike Cannon-Brookes is there because he is a billionaire who uses his wealth to pursue fashionable moral causes and boasts about it on Twitter.

His citation, written by Al Gore, credits Cannon-Brookes with “redefining the role of climate activism in business and investment”. It praises him for using his financial firepower to stop AGL “spewing greenhouse-gas pollution for another two decades”. As incoming Energy Minister Chris Bowen is quickly realising, woke capitalists such as Cannon-Brookes have grown in influence since Labor was last in power. They will make it hard for the new government to ensure a steady supply of electricity and keep prices low. The greatest energy challenge for this government, as it was for the last, is not to save the planet from an imagined climate catastrophe. It is to balance the supply of gas and coal-fired energy with weather-dependent renewable generation until a better solution comes.

The timetable for closing Australia’s ageing coal-fired plants must be determined by technology, not ideology. It can happen sooner if the generating capacity of coal plants is replaced with cheap gas, but the obstacles to extracting gas from our abundant reserves are formidable, not least in Victoria where gas is treated like the devil’s fuel by the one-eyed Andrews government, even though his state burns far more of it per capita than any other state.

Enter Cannon-Brookes, a renewable energy investor determined to shut down our coal generators by tomorrow at the very latest. Without the money he made in IT, he might be just another self-righteous whiner on Twitter. Instead, he bought himself the position of an activist with clout, notably by buying a strategic share in energy giant AGL.

AGL’s board has been concerned for some time about the growing yuck-factor of coal and made plans to spin off its coal-fired generation to a separate company by the end of the year.

This was not enough for Cannon-Brookes, who wants AGL not just to divest its coal assets but use its market power to end coal generation completely.

Last week he called the AGL board’s bluff, persuading it to scrap the demerger plans and facilitating the departure of its chairman and CEO. It may strike us as a somewhat spineless reaction, given that 88.7 per cent of the corporation is owned by investors other than Cannon-Brookes – self-funded retirees, for example. Today, however, the petty interests of shareholders come second to the responsibility to invest in ESG, supposedly to benefit society as a whole. In little more than a decade, environmental, social and corporate governance has moved from a fringe pursuit to the mainstream and become a legislated requirement in some jurisdictions. Its social goals satisfy the woke priorities of a wealthy elite. Typically, they include environmental goals, the support of certain social movements such as Black Lives Matter, and the goals of diversity, equity and inclusion.

They do not include the social goal of easing the burden of electricity prices on the less well-off. Neither does preserving the prosperity of communities in the Hunter Valley nor indeed maintaining the standard of living of the nation as a whole. That is why the trade-offs between environmental goals and livelihoods are better decided by the elected government than titans of industry, and why Bowen’s first test is to assert control over the levers that will determine the pace of transition from coal to other energy sources. He would do well to acquaint himself with the capacity mechanism proposed by the previous government that would impose heavy penalties on energy companies that fail to meet commitments to supply dispatchable energy.

In the circumstances, Labor’s lower house majority should be cause for national celebration. It will disappoint Cannon-Brookes, who contributed to the Climate 200 campaign in 2019 and would no doubt have welcomed the prospect of teal independents holding a minority Labor government to account. The source of the millions behind the teal movement deserves close investigation. Strangely, many who would normally voice opposition to businessmen buying political influence have remained silent about this ominous development in our democracy.

Anthony Albanese must seize the opportunity to assert the primacy of parliament and confront those who want to bypass democratic debate on civic disagreements. He has a free hand to govern in the interests of the people who elected him, rather than the interests of the rich who use their financial clout to shout over the top of ordinary Australians.