How 20th century black business leaders predicted fairer capitalism

How 20th century black business leaders predicted fairer capitalism

Let’s take a closer look at two early twentieth-century Black business leaders to better understand their alternative approach. In contemporary times, we have witnessed corporations’ promises to do better. However, some companies, even those that have made significant steps toward diversity and inclusion even those that have created much needed jobs for the unemployed within communities, are still failing the stakeholder capitalism test. This has been made especially clear during the pandemic as complaints surface about economic and health disparities due to workers’ race, as well as unsafe working conditions and low salaries for certain workers. Charles Clinton Spaulding

As we studied the owners and executives of these companies, we noticed a pattern in their management philosophies and actions: a love of community that loomed large and permeated their business. As we describe in our recent book, many Black business pioneers built their businesses in ways that supported and strengthened the people around them: employees, customers, and local communities. These efforts were beneficial to the companies’ success: Care is often reciprocated, and many successful Black businesses were robustly sustained by the African American community which was happy to patronize organizations that cared for its members’ well-being. University of Texas business historian Dr. Juliet E.K. Walker was the first to name the period from 1900 to 1930 in the United States the golden age of Black News. She observed that many companies owned by Black entrepreneurs (which primarily served Black customers) thrived in a country starkly divided along racial lines. These companies included not only small local shops but also organizations with regional, national, and international reach such as insurance companies, financial institutions, manufacturing companies, and beauty enterprises. For example, Annie Turnbo-Malone built a beauty, hair care, and cosmetic empire under the “Poro” brand, establishing branches in major cities in the US, and achieving a business presence in Canada, the Philippines, the Caribbean, South America, and Africa. By recruiting and training sales agents she created almost 75,000 jobs mostly held by Black women and women of color.

That these efforts were needed at all was a reflection on the failure of the US government as well as white-led corporations in the wake of slavery and reconstruction. Rampant racial discrimination led to unemployment and underemployment. Blacks were less likely to be hired (except for marginalized jobs) and more likely to be fired, often to make room for white applicants. Enterprising African Americans filled the void by engaging in their own social sustainability efforts to ensure community wellbeing. The Golden Age of Black News

For his contributions, and the critical role he played in the history of management, Spaulding was inducted in 2020 to the Thinkers50 Hall of Fame. Maggie Lena Walker His passion extended to helping his wider community as well. Spaulding was one of the pioneers of what we now term corporate social responsibility. In an article he wrote in 1937, Spaulding laid out what he called the Four Cardinal Points of Entrepreneurship, one of which was “social service in business.” He explained how he and his partners were not only interested in making a profit, but also determined to ensure that their businesses remained socially responsible to the communities within which they operated. He followed these convictions in his own entrepreneurialism as he helped build an extended family of financial institutions that improved the living and working conditions of African Americans and strengthened race relations by creating safe work environments where Blacks and whites collaborated. When W.E.B Du Bois visited Durham’s Black Wall Street and the North Carolina Mutual Life Insurance Company in 1912, he praised the firm for its emphasis on cooperation over capitalism.

Spaulding exhibited a management style that deliberately benefitted all stakeholders and which earned him the nickname “Mr. Cooperation.” It began with all of his employees: For example, in 1921, Spaulding began an initiative at his company known as the Forum as a way to increase company spirit and self-improvement of all employees. He encouraged younger employees to test their oratorical skills, and there were sessions for employees to air their grievances. Additionally, Spaulding insisted that employees from the lower ranks serve as the leaders of the Forum to aid in their growth. Charles Clinton Spaulding is known as the father of African-American management and has been recognized as one of the great American business leaders of the 20th century. Under his management in 1900–1952, the North Carolina Mutual Life Insurance Company on Durham’s Black Wall Street grew into the largest Black-owned business in the country. The firm supported many local Black-owned businesses and other worthy causes, and its eventual subsidiaries were also Black-operated. They were largely responsible for promoting economic development via employment opportunities for both men and women, as well as promoting talent development via training, leading to progress in economic and social standing, and ultimately supporting the growth of a Black middle class.

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