Drawing on one’s personal story to develop a more authentic and value-based leadership style is what shapes Mark Bertolini’s approach to leading one of America’s largest companies. Bertolini, President of Aetna, has a vision for a better form of health care in the US that was formed out of his experiences accompanying his son as he underwent treatment for what was diagnosed as terminal cancer in 2001. The complexity of the system made him think a better way must be possible. Bertolini himself also suffered a severe ski accident which left him disabled for a year and from which he continues to suffer near constant pain. His recovery led him to explore alternative treatments such as meditation and yoga, practices which have since been incorporated into Aetna’s corporate life as a means to reduce stress and staff turnover.
The social problem of income inequality is where this people-first leader is attempting to make a difference. He made headlines in 2015 after significantly raising the base pay of all Aetna employees, sparking a debate around the hard and soft benefits that come with wage and benefit increases. “For a long time we put it at the foot of government, and haven’t really taken on our own responsibility and redefining the business models that we have and the way we operate our businesses to solve this problem. Corporations can be and should be a responsible part of society, and we need to lead because of the tremendous number of individuals we have an impact on every day,” he said.
Providing employees with economic security both financially and in heath are foundational issues that Bertolini advocates as necessary to addressing financial inequality in the United States. According to Bertolini, “Health creates productive individuals. Productive individuals are culturally, socially, spiritually, and economically viable.” If we can achieve this across the globe we would live in a much more happy and civil world. The effort must start in the United States where the disparity between people’s earning is larger than in any other democracy in the world.
“US non financial companies held $1.7 trillion domestically and $2.1 trillion abroad. Why are we sitting on our cash? As I tell my fellow CEOs, this is a bit like the city states of the plagues of Europe in the 1600 and 1700s when we closed the gates, protected our citizens, until the plague passed by. But this plague will not pass by unless we go out and address it,” declared Bertolini.
Our scarcest resources are our people. “Business leaders are educated to husband scarce resources, and for a long time we’ve been convinced by our business schools that our scarcest resource is capital. But there is a lot of money to be had,” said Bertolini. Talent and an engaged workforce is what business leaders should be husbanding. “When you are running a corporation, the easy thing to do is grab what you can see now. It’s easy to cut back on staff, capital investment and research and development.” This puts the company at long-term risk, but given the short tenure of business leaders around the world, the long-term does not matter as much as the short-term.
Governments can help. Capital investments in machinery have long-term depreciation tax breaks, while investment in people is expensed immediately. We need to change the rules. “The government can help us move human capital, the scarcest resource we have, to the top of the list by offering us relief in the way we think about tax structure, accounting principles, and the way we report earnings.” Bertolini also advocates for businesses to be able to capitalize on investing in people and depreciate employees as long as they are with a company.
The United States is under investing in social programs, basic assistance such as rides to doctor’s appointments and ramps for seniors. “A recent study showed that white, middle-class males have a rapidly rising rate of mortality. The differences in our health status, long felt to be around racial and ethnic differences, really are around social determinates.” Our health care system focuses on illness instead of producing happy and productive people, but this is not working.
Bertolini’s humanist approach to leadership calls for an end to discounting the soft benefits and magnifying the costs associated with them. He does not believe “corporations cannot do good and do well.” He sees a world where businesses go beyond assumptions and paying lip-service to caring about employees and actually do something about income inequity. It is a win for everybody, he says, “When you invest in your human capital you build sound business fundamentals, a repeatable and valued product that your customers buy over time. The result is a healthy bottom line and the street values your stock higher because you’re a growth company.”
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