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Intro Announcer: Hello and welcome to The Conscious Capitalists, hosted by two of the co-founders of the conscious capitalism movement and co-authors of the Conscious Capitalism Field Guide from Harvard Business Press, Raj Sisodia and Timothy Henry. Each week this podcast covers current events and business news and Raj and Timothy’s latest thinking on what it takes to build a conscious business. For more information and notes from the show, go to www.theconsciouscapitalists.com. And now, Raj and Timothy.
Timothy Henry: Hello everyone and welcome to episode number 43 of The Conscious Capitalists with myself, Timothy Henry, and my partner in making the world a better place through business, Raj Sisodia. Hey Raj.
Raj Sisodia: Hey Timothy. Good to see you again.
Timothy Henry: Good to see you. And we’re into the fall here and really have a near and dear guest today. Since you’ve co-authored a book with him, maybe you’d be the best person to introduce him.
Raj Sisodia: Well, it’s my pleasure. Bob Chapman is one of my heroes in the world of business and leadership, but even as a human being. I first connected with Bob back in 2013 after the Conscious Capitalism book came out. A friend told me about this CEO of a company in St. Louis and said his story needed to be told. Initially, I was a bit dismissive, thinking we had already covered many conscious companies. However, in July 2013, Bob flew me to Phillips, Wisconsin, to visit one of their plants.
I sat in a room with about a dozen blue-collar men and asked how their lives changed after Bob’s company, Barry-Wehmiller, took over. There was silence, and then several of these men had tears streaming down their faces. They shared stories of how their lives used to be in toxic, insecure manufacturing environments where they were frequently laid off and reduced to extreme poverty. One man even recalled collecting empty cans to buy baby formula. After the acquisition, they were treated with respect, dignity, empathy, and care. The mayor of that town even told Bob, “That man saved our town,” because the company employed 600 people in a town of 1,400.
This led to a major “aha” moment for me: our people are the purpose. Even if a company doesn’t have a noble product purpose, any business can be conscious by finding a higher purpose in the impact they make on their people. Bob defines leadership as the stewardship of the lives entrusted to us. So, Bob, tell us how you became that leader, especially compared to 1975 when you took over a struggling $18 million business at age 29 after your father’s sudden passing.
Bob Chapman: Well, Raj, my journey has been eclectic. In the first half of my career, I was focused on what I learned in business school: creating economic value, cutting costs, and improving profitability. It was all about me and my success. But starting in 1997, I had a series of revelations.
The first was at a company in South Carolina. I noticed people having fun talking about March Madness, but the “fun went out of their bodies” the moment they started work. I realized business should be fun, so I turned work into a game with rewards. We saw a 20% increase in revenue but a 1,000% increase in joy.
The second revelation happened in church. I realized that while our pastor had people for one hour a week, we had them for forty. Business could be the most powerful force for good in the world if we simply cared about the people we led.
The third was at a wedding. As I watched a father give his daughter away, I realized all 12,000 of our employees were somebody’s precious child placed in our care. I stopped seeing people as functions for my success and started seeing them as a profound responsibility.
Raj Sisodia: So how did you practically start to bring this into the business on Monday morning?
Bob Chapman: We gathered twenty people for two days to create our “Guiding Principles of Leadership”. We decided to measure success by the way we touch the lives of people. Our Chief People Officer challenged me, noting that even Enron had beautiful statements on the wall but didn’t live them. So, I began “listening sessions” around the world to find where we weren’t living our values.
One man in the assembly department pointed out that we trusted him to travel to Puerto Rico for a job, but at the plant, he had to punch a time clock and ask for a payphone, while the “office” people didn’t. We immediately addressed those inconsistencies. I even told our president to take down the cages in the storeroom because those cages communicated that we didn’t trust our people. Mutual trust is the foundation of truly human leadership.
Raj Sisodia: You also have a unique philosophy on growth. You don’t just acquire companies; you adopt them. You’ve done about 125 acquisitions and have never sold a single business. From $18 million in 1975, the company is now around $3.4 billion.
Bob Chapman: Since 1997, our share price has gone up a compound 14% a year. I believe human value and economic value can exist in harmony. But as a leader, your primary responsibility is to design a business model—the “bus”—that gives people a sense of safety and security. Culture is the fuel that allows that engine to perform, but you can’t have a good culture without a good business model, or you will hurt people.
Right now, our system is broken. 88% of people feel they work for an organization that doesn’t care about them. There is a 20% increase in heart attacks on Monday mornings. We have a “poverty of dignity” because we treat people as functions. Our education system produces specialists but doesn’t teach leadership skills like empathetic listening or recognition.
Raj Sisodia: You also have a culture of recognition and celebration.
Bob Chapman: We focus on the goodness, not the brokenness. We “shine a light” and say thank you in a timely and appropriate way. We often recognize employees in front of their families, which is profound because kids never forget seeing their parents valued. We also practice “courageous patience”. Everyone has a different journey, and we give those who aren’t ready to “get on the bus” time to decide. If someone truly doesn’t fit, we treat them with the same respect we’d want for our own son or daughter.
Timothy Henry: That reminds me of the show Ted Lasso—it’s that same idea of caring beneath the cynicism.
Raj Sisodia: Bob, you faced a real test of this culture during the 2008 financial crisis.
Bob Chapman: Our board asked if we would do layoffs. I realized that if we let people go, we would be destroying lives. So we asked everyone to take a month off without pay so that no one had to be let go. The reaction was incredibly positive. People even offered to take extra time off to help colleagues who couldn’t afford it. Our share price actually went up 11% during that time while others collapsed. When things improved, we even made up the 401k match we had suspended, because we wanted to show we cared about their long-term security. Layoffs cause “collateral damage” to trust that you can never fully calculate.
Raj Sisodia: I remember you telling me once that on your deathbed, you won’t be proud of the machines you built, but the lives you touched. I told you then that you’re not just growing a business; you’re spreading a healing ministry.
Bob Chapman: You can quit a job, but you can’t quit a calling. I feel it is my responsibility to share this blessing. The greatest act of charity isn’t the checks we write to organizations; it’s the way we treat the people in our span of care.
Timothy Henry: Bob, thank you for being an inspiring example.
Bob Chapman: It’s a privilege. I hope your listeners will join us in this journey to show we can create both economic and human value.
Timothy Henry: Thank you, Bob. And thank you to our listeners. Please hit the subscribe button and leave us a review at theconsciouscapitalists.com. Thank you, Raj.
Raj Sisodia: Thank you, Timothy. Pleasure as always.