It happened again. Following on the heels of Shark Tank’s Kevin O’Leary and venture capitalist Tom Perkins, a new global executive has decided to share their learned insight on the nature of poverty in America and around the world: co-founder and CEO of Nicole Miller, Bud Konheim.
First, let’s get our facts straight about the rising income inequality in the United States. The top 1% captured 95% of the income gains in the first three years of the recovery, from 2009 to 2012. Therefore, top 1% incomes are close to full recovery while bottom 99% incomes have hardly started to recover.
Speaking to CNBC’s “Squawk Box”, Konheim explained his view on poverty in America: “We’ve got a country that the poverty level is wealth in 99 percent of the rest of the world… the guy that’s making, oh my God, he’s making $35,000 a year, why don’t we try that out in India or some countries we can’t even name. China, anyplace, the guy is wealthy.”
Yes, Mr. Konheim, making $35,000 a year in the United States is exactly like making $35,000 a year in India. How can a CEO of a major global fashion brand that grosses more than $650 million in annual sales have such an infantile and ignorant perspective on economics, poverty, wealth, and the very idea that progress is relative to context and circumstance?
21st century business leadership requires CEOs to not only take an economic stand, but a social and environmental stand as well. This is what separates the tunnel vision of Konheim at Nicole Miller from more enlightened leaders who get it, like Muhtar Kent of Coca-Cola, Peter Agnefjäll of IKEA, Richard Branson of Virgin, Paul Polman of Unilever, Michael Kowalski of Tiffany & Co., and former Chairman and CEO at PUMA Jochen Zeitz—all of whom are intimately involved in harnessing the power of their businesses as a force for good. These leaders are ‘greening’ international supply-chains, sourcing raw materials more responsibly and sustainably, focusing on the economic empowerment of women in some of the most challenging environments, and seriously considering the human cost of their business operations. In short, they are beginning to put people and planet on equal footing as profit.
Konheim’s line of thinking is but a growing trend. In case you forgot what happened the last several weeks, Kevin O’Leary recently reacted to the Oxfam International report noting that the wealth of the world’s 85 richest people is equal to the wealth of the poorest 3.5 billion. He was thrilled with the findings saying, “this is a great thing because it inspires everybody, and gets them the motivation to look up to the 1 per cent and say, I want to become one of those people. I’m going to fight hard and get up to the top.”
Similarly, Tom Perkins’ wrote a letter to the Wall Street Journal last month comparing the hostility aimed at the 1% to the treatment of the Jews in Nazi Germany. And on Thursday, he proposed a grand idea for change: if you don’t pay taxes, you shouldn’t be allowed to vote.
It’s unlikely that Konheim will step down after making such comments, so it’s up to consumers, retail stores and partners to send a message of condemnation. It’s time for fashionistas of the world to vote with their wallets. It’s time for stores like Neiman Marcus, Saks Fifth Avenue, Nordstrom and Bloomingdale’s to rethink stocking up on Nicole Miller merchandise. And it’s time for celebrities like Beyoncé Knowles, Jennifer Aniston, Halle Berry, Angelina Jolie and others not to fuel this brands success by supporting a founder and CEO who unequivocally trivializes hardship in the United States and around the world. In other words, it’s time to take a stand.
Source: Forbes Business