| Empowered employees key to success, says Whole Foods exec BY ADRIENNE FRANK 
Photo by Jeff Watts
With corporate America facing a “legitimacy crisis,” Whole Foods executive Jim Sud said businesses should focus less on the bottom line and more on the public good. By thinking “more holistically” and applying the concept of “conscious capitalism . . . the profits will follow. “Business is fundamentally a community of people working together to fulfill its collective mission and create value for all its shareholders,” explained Sud, Whole Foods executive vice president of growth and business development, who, on Mar. 30, addressed an audience of Kogod School of Business students that included his daughter Jewel. Sud is a founding shareholder of the corporation, whose local markets count AU students,
faculty, and staff among their loyal customers. He advocated a “new business paradigm,” which views corporations as “complex systems of interdependent
constituencies.” By focusing on the well-being of their constituencies—
customers, employees, investors, the community, and the environment—businesses will breed both goodwill and profits, said Sud. “All of this is so simple, it’s amazing to me that most businesses don’t get it. If you have employees who are empowered, that’s going to lead to happy customers, which leads to happy investors.” Whole Foods, America’s first national “certified organic grocer,” was founded in 1980 in Austin, Texas. The chain is proof of the power of a happy workforce. The food retailer, which had sales of $5.6 billion in 2006, has been ranked among the “100 best companies to work for” for the past 10 years in a row—thanks, Sud said, to Whole Foods’ innovative employee practices. The company provides health insurance for all full-time employees, who vote every three years on a benefits package. “Team members” also receive 93 percent of stock options. And in 2004, when the average American CEO received $431 for every $1 earned by workers, Whole Foods’ CEO’s pay was limited to 19 times that of the average worker. “I was telling an MBA student about our salary cap and he said, ‘That’s great, but how do you guys really get around it,’” Sud laughed. “Clearly, he didn’t get it.” Sud also detailed Whole Foods’ philanthropic endeavors. The retailer donates 5 percent of its profits—about $11 million in 2006—to nonprofits and contributes, including $1 million annually to its two foundations: the Whole Planet Foundation, which offers microcredit loans to low-income people in countries where Whole Foods sources its products, and the Animal Compassion Foundation, which works to improve the quality of life of farm animals. Sud spoke as part of Kogod’s Alan Meltzer CEO Leadership Speaker Series. |
