Ethan Peck on ‘Managerial Class’ Behind Woke Takeover of Corporate America

A sign for BlackRock on its building in New York on July 16, 2018. Lucas Jackson/Reuters

In April 2021, large corporations such as Coca-Cola, Delta Airline, and Home Depot rallied against Georgia’s election reform, parroting a leftist narrative that the measure was “racist.” It was seen by many as a manifestation of the “woke” takeover of corporate America, in which a company’s capital is diverted to left-wing causes that shareholders never intended to support.

The driving forces behind this trend, however, were not left-wing activists, but powerful mega-funds seeking to entrench their regime under the guise of wokeness, according to Ethan Peck, an associate at the National Center’s Free Enterprise Project.

“I think it’s a scam,” said Peck in a recent interview with NTD.

Peck, a free enterprise advocate who constantly engages corporate CEOs and board members at shareholder meetings, said many board members don’t genuinely believe in woke ideology, but use it as a tool to advance so-called “stakeholder capitalism.”

Stakeholder capitalism, as opposed to traditional shareholder capitalism, holds that a company is responsible for the collective interest of every member of society, rather than those who own the company’s shares. The concept, first introduced by World Economic Forum’s Claus Schwab in 1979, has since remained a fringe concept until recently, in the wake of the global CCP (Chinese Communist Party) virus pandemic.

Peck compared stakeholder capitalism to communism, where the state controls and redistributes resources in the name of a “greater good.” “It’s kind of the corporate version of communism,” he explained, adding that “it’s a trick. It just empowers the boards to basically take voting powers and rights from the shareholders.”

The Big Influence

When asked about the force pushing American corporate boardrooms to embrace stakeholder capitalism, Peck pointed to the world’s largest money managers: exchange-traded fund (ETF) giants BlackRock, Vanguard, and State Street Global Advisors.

“I think that the big influences are coming from big ETF managers. They’re the ones that basically have the voting power to put board members onto boards,” Peck said.

According to a 2019 analysis by researchers at Boston University, BlackRock, Vanguard, and State Street cast about a quarter of votes at the shareholder meetings of S&P 500 companies, and could control 40 percent of those votes within 20 years. This means all major corporate matters, including shareholder resolutions and board member elections, depend on how the Big Three vote.

“[The Big Three] are voting on behalf of their clients who invest in them,” Peck said. “They’re not really the shareholders, but they’re the ones that dominate the election so much that the board members are essentially just minions.”

According to Peck, the Free Enterprise Project, which has attended 58 shareholder meetings so far this year, didn’t see any Big Three-favored board member receiving below 90 percent of the vote. “So you know these elections are charades,” he said.

As a result of what Peck called an “overthrow of the boards of every corporation in America,” a “managerial class” has emerged. It doesn’t represent the interests of the shareholders, but has no trouble using shareholders’ money to advocate against voter ID requirements, support radical sex and gender ideologies in K-3 classrooms, and lobby to water down sanctions on Chinese goods made with slave labor.

An Incestuous Network

The managerial class enhances its power through a network of “professional board members” who sit on multiple corporate boards, according to Peck. He called such practice “incestuous.”

“The CEO of Coca-Cola is on the board of Pfizer. The CEO of BlackRock is on the board of the World Economic Forum. It’s very incestuous,” he said.

To illustrate how it works, Peck pointed to the Uyghur Forced Labor Prevention Act, which was adopted by Congress in December 2021 with overwhelming bipartisan support. In a bizarre move, Coca-Cola lobbied against the measure on behalf of Apple and Nike, which were facing allegations of using forced labor in China’s Xinjiang region.

“Coca-Cola was hiring these lobbyists, but they don’t even use any Uyghur forced labor,” Peck said. “What was Coca-Cola’s interest? Why were they defending Apple and Nike, even when there was bipartisan support for the Act? Because you have the board members support each other.”

“Then there’s this revolving door between the boards and the bureaucracies,” he added. “They go to the boards, and then they come back to government, and then go to the boards, and then go between companies. So you have this managerial class of this giant board. It’s basically just like one big board over all of America.”

Peck said this could explain the “consistency” among woke companies. In other words, the companies react to social and political issues the same way at the same time because Big Three proxies dictate their boardrooms.

Corporate Board vs School Board

While the managerial class remains powerful, Peck said he sees hope in the parental rights movement in Virginia, in which parents are calling out at local school board meetings attempts to inject critical race theory into schools, on the basis that they as taxpayers deserve more say in what should be taught to their children.

“It might not be today or tomorrow, but I’m hopeful that shareholders will wake up just like the taxpaying parent and do the same thing at the corporate level,” Peck told NTD.

“I think it’s time we own up to it. I think it’s time that shareholders show up to shareholder meetings and say, ‘Hey, you can’t do this with our money!’”