How 20th-century black business leaders envisioned a more just capitalism
Think back over the pantheon of 20thcentury corporate leaders and thinkers you learned about in business school and you’ll likely conjure up figures like Frederick Winslow Taylor, Peter Drucker, Jack Welch or Clayton Christensen. It’s hardly a surprise that these canonical giants are largely male and white. What’s less well known is that the same century in the U.S. saw a golden age of Black business and Black business thinkers. Deeply rooted systemic prejudices meant that these individuals and their thinking were omitted from most textbooks, leadership workshops and public consciousness. It’s past time to incorporate their work into what we know of business history, not only because it is the ethical thing to do but because in our research as management historians, we’ve found that a more racially inclusive history of management is filled with profound advice about the role of business in society that is relevant for leaders today.
THE GOLDEN
BLACK BUSINESS
University of Texas business historian Juliet E.K. Walker was the first to name the period from 1900 to 1930 in the United States the golden age of Black Business. 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 held mostly by Black women and women of color.
AGE
OF
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 businesses. 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.
Let’s take a closer look at two early twentieth-century Black business leaders to better understand their alternative approach.
CHARLES
SPAULDING
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 from 1900 until 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
CLINTON other worthy causes, and its eventual subsidiaries were also Black-operated.
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.
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. 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.
MAGGIE LENA WALKER Spaulding was far from the only Black entrepreneur whose business success was deeply tied to community mission. Take Maggie Lena Walker, who was born poor in 1864; by her death in 1934 she had become an African American visionary, teacher, entrepreneur, business and civic leader, philanthropist and activist for the rights of African Americans, women, and especially Black women. Walker was the first African American woman to start a bank; she also founded a newspaper and a department store.
As a feminist, Walker challenged the notion that a woman’s place was in the home. She was confident that the sphere of women’s occupations was widening, and that there were professions traditionally seen as men’s work that could be pursued by women, including women of color (until that time Black women were often limited to occupations such as washerwomen).
Like Spaulding, Walker acted on these beliefs, creating economic opportunities for Black women. The businesses she created employed women and allowed them to step out of their comfort zones, learn business skills, and prove their competence; the companies also provided affordable, highquality goods and services to their communities. Under her leadership, her organizations positively impacted the economic and social landscape of the Black community by creating jobs, facilitating homeownership, and shedding light on atrocities facing the community so they could be addressed.
A MORE COMPASSIONATE FORM OF CAPITALISM
We see Spaulding’s and Walker’s approaches — echoed in many of the successful Black enterprises of that era — as critical to the success of today’s corporations. It has become increasingly clear that companies have a significant role to play in creating sustainable cities and communities and in building an equitable economy and society. The Black businesses of Spaulding’s and Walker’s era engendered a spirit of care, meaningful dialogue and consensus building for the benefit of employees, customers, and the community. We call this approach cooperative advantage and see its roots in African traditions of cooperation such as Ubuntu, which means “I am, because we are.”
We believe that the cooperative advantage approach is an important model for today’s leaders as they seek ways to build social sustainability into their business models. And in a world in which only 8% of managers and 3.8% of CEOS are Black and in which Black women face particular exclusion and prejudice due to their gender, skin color and hairstyles, we believe the business world has missed out long enough by not learning about these inclusive community-oriented approaches pioneered by Black management thinkers and practitioners.