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Mises.org David Gordon 11/29/2024 Andrew Puzder, who is both a leading business executive—he was the CEO of a restaurant chain that owns Carl’s Jr.—and an experienced attorney, tells a dramatic tale. The free market is by far the best economic system and has made possible, since the Industrial Revolution, a historically unprecedented rate of economic growth. The free market is an economic democracy in which entrepreneurs vie to do the bidding of consumers, who, in most cases, want the most money possible. In corporations, the consumers are the corporations’ owners, the shareholders, and officers of corporations have a fiduciary duty to them. In recent decades, a new conception of the free market—“stakeholder capitalism”—has become influential, although a resistance movement has arisen that has been able to thwart the most drastic ideas of the stakeholder advocates. According to them, the managers of companies should take into account the interests and values of all of those affected by the company. The stakeholder advocates do not deny that managers have a fiduciary duty to the owners of their business, but they claim that other things must be considered as well. Two of these other concerns—encapsulated in the acronyms ESG and DEI—especially concern our author. I will not explain what these acronyms stand for—readers who want to know can easily find out. Suffice it for our purposes to say that they call for more “diversity,” by which is meant hiring more women and members of ethnic minorities and putting them on the company’s board of directors, and also greatly decreasing the use of fossil fuels in order to deal with “climate change.” Puzder, to say the least, is not sympathetic to “diversity” as it is currently understood, although he does not reject it altogether. He thinks it is desirable to have women and members of ethnic minorities on company boards of directors, because this promotes “cognitive diversity,” but he thinks that this will come about as a side effect if everyone elected to the board is committed to putting their fiduciary responsibility to the shareholders above other considerations, and he opposes mandating these other considerations by government agencies that have been taken over by the “woke” left.