Snack King Takes Bite Out of Biased Politics
WHY YOU SHOULD CARE
For better or worse, business leaders have a greater responsibility to right society’s wrongs.
By Nick Fouriezos
In downtown Manhattan, Keri Rapisarda stands in front of her fidgeting class of third-graders. “We’re going to connect with our partner school,” she says. Soon enough, a gaggle of fifth-graders from Toronto stare back at them over an interactive whiteboard. The children take turns telling their new international friends about their lives. They compete with chants of “Go Maple Leafs!” and “Go Yankees!” The Canadian children start teaching French to the New Yorkers: Bonjour, comment ça va. S’il vous plaît.
Dozens of similar exchanges have taken place in elementary school classrooms across the globe since October, when Empatico launched. The video conferencing program is not the work of some education nonprofit or feel-good government initiative though. It’s the brainchild of Daniel Lubetzky, the founder and CEO of KIND Healthy Snacks. The platform hopes to expand the horizons of children “across different cultures, religions,” he tells OZY in his midtown Manhattan office. The Jewish-Mexican immigrant is a lifelong businessman: As a kid, he performed magic as “The Great HouDani,” and sold watches while a college student at Trinity University in Texas. But more than that, Lubetzky is the son of a Holocaust survivor, a history that haunts his decisions more than any bottom line. “I’ve felt this enormous weight of having a responsibility to prevent what happened to my father from happening to others,” he says.
It has to be authentic. There is this trend toward ‘corporate social responsibility’ or ‘corporate citizenship,’ and sometimes it’s just gimmicky.
He is not alone. Today, more business leaders are willing to embrace practices that value more than just profits. KIND was one of nearly 130 companies that signed an amicus brief arguing against President Donald Trump’s travel ban in February 2017. That same month, Lubetzky pledged $25 million personally to form Feed the Truth, an organization promoting “public health over special interests” in the food industry. The company started a “radical kindness” campaign, and Emmanuel Lubezki (a cousin of Daniel’s) produced a film showing volunteers leaving jugs of water across the U.S.-Mexico border to prevent deaths in the desert. KIND is instituting the policies it wants to see in politics, including a Hardship Fund, which team members can draw from in times of financial difficulty. “He has a very human approach to leading,” his chief of staff, Elle Lanning, says.
Still, trying to solve society’s ills is a burden. Lubetzky is confident and empathetic, but he doesn’t look at peace, despite building KIND Snacks to become the fastest-growing nutrition bar company in America with a valuation in the billions of dollars. The 49-year-old is running an hour late for our interview. Or more accurately, limping, his left leg in a cast after an accident playing soccer with one of his four children the day before. “When my team asks me what keeps me up at night, they tend to be asking in terms of the business,” he says. “I almost always answer that it’s not about the business: It’s about where we’re heading as a society.” He sounds eager. And exhausted.
Despite a reputation for being tight-lipped, business leaders like Lubetzky — including many who enter the political realm — have increasingly been willing to speak up on social issues. In February, businesses including Delta Air Lines, Hertz Corporation and Dick’s Sporting Goods took public stances against unfettered gun sales following the high school shooting in Parkland, Florida. Lubetzky couches his argument by saying he speaks on how business can solve societal issues, not political ones. However, it’s often been progressive businessmen leading the charge on issues from gay marriage to income equity — think Starbucks’ Howard Schultz, Apple’s Tim Cook and Blue Apron’s Joe Sanberg.
That activism is surprisingly welcome, especially among millennials, according to research from Weber Shandwick released last year. The public relations firm found that nearly half of Americans believe CEOs who don’t speak out on issues risk criticism, and one-fifth said silent CEOs risk declining sales. “Traditional institutions of government, family and religion are failing at providing the leadership for a better world. Socially conscious businesses are increasingly seen as the last best hope,” Jeffrey Solomon, president of the Andrea and Charles Bronfman Philanthropies, writes over email.
But it also risks alienating consumers who disagree with brands’ political stances. Lubetzky insists he is “staunchly independent,” but he did donate over a quarter-million dollars to pro-Democrat groups from 2015 to 2016, according to Federal Election Commission data. His past donations lead to criticism from groups like 2ndVote, a conservative watchdog that studies contributions from corporate leaders. And speaking out can lead to backlash, as it did for Delta, which eliminated a National Rifle Association member group discount after the Parkland shooting. In response, Georgia’s Republican lawmakers blocked a tax exemption for the airline. “In my view, it was somebody’s harebrained idea to jump on the issue and get some credit,” Larry Parnell, director of the Strategic Public Relations program at George Washington University, said of Delta at a recent panel discussion in Washington. ”There is no business connection, no significant bottom-line impact or strategic rationale.”
Lubetzky grew up in Mexico City, and his college thesis focused on repairing Arab and Israeli relations through business. A $10,000 fellowship in Tel Aviv, Israel, led him to create PeaceWorks, which developed pestos and sun-dried tomato products through cooperation between neighbors in conflict regions. OneVoice, which he started in 2002, is a New York nonprofit that trains grassroots activists in Israel and Palestine to advocate for a two-state solution (in the past, it’s been accused by conservatives of using State Department grants to influence elections against Prime Minister Benjamin Netanyahu, although a Senate subcommittee found that the group’s campaigning came after the grant ended). Lubetzky started KIND in 2004 to provide a healthier alternative to snack bars; in 2011 he co-founded Maiyet, a luxury fashion venture that promotes entrepreneurship in developing economies. Lubetzky found businesses to be scalable and sustainable in a way nonprofits weren’t. “You don’t have to artificially raise funds,” he says, and increasingly, the model comes with a social responsibility too. “It has to be authentic. There is this trend toward ‘corporate social responsibility’ or ‘corporate citizenship,’ and sometimes it’s just gimmicky.”
Brand forays into activism can be treacherous. Another study by Weber Shandwick, conducted in 2016, said one-third of Americans are skeptical of CEOs speaking out on issues not tied to the company’s core business. KIND itself faced scrutiny in 2015, after Lubetzky built his snacks on the promise of their health benefits, only to have the Food and Drug Administration ask that it remove the term “healthy” from its labels for having too much saturated fat. The company complied, but responded by saying its fats came from healthful sources: whole nuts and seeds. KIND also had a dozen top nutritionists sign a petition to the FDA to update its guidelines in response, and in May of 2016 the FDA reversed its stance and allowed KIND to restore its “healthy” label.
Government has proven frustrating to Lubetzky at times, but so far Empatico has met some of its lofty early goals, including surpassing 1,000 teachers by the end of the school year (currently there are 1,384 registered across more than 60 countries) and conducting more than 100 exchanges. Whether Empatico will also reach 1 million students by 2020, as Lubetzky hopes, is still to be determined. “Teachers need to do due diligence on a product before introducing it to students in their classroom,” says Empatico executive director George Khalaf, and it’s a harder sell than getting a consumer to take a chance on a $3 KIND bar. “It requires patience. And when dealing with ambitious, successful social entrepreneurs, there is this urgency to everything being done.”
That urgency takes its toll. Last November, Lubetzky met with New York Times columnist Thomas Friedman, and the pair talked about the state of the world, political polarization, global threats and the environment over bagels, cream cheese and strawberries. Expecting to find his boss feeling enlightened, Khalaf says he returned to Lubetzky’s office to find the CEO visibly anxious.
In a wide-ranging interview with OZY, Lubetzky worries about party politics: “It’s like these two systems took a life of their own and they are just monsters gobbling things up to maintain control.” On the looming mass automation of jobs, Lubetzky says: “Automation is going to be a much bigger disruptive challenge to society than globalization was or is.” Even before the Cambridge Analytica scandal came to light, he took aim at giants like Facebook and Apple for abdicating their duties to the public. “Technology companies think they are doing the greater good and rationalize everything,” he says, but the promise of a connected world has been bastardized. “The digital connections have been the opposite, just reinforcing echo chambers and biases,” he says.
That healthy skepticism is refreshing at a time when Wall Street and Silicon Valley seem determined to sell a message of ever-increasing optimism. Lubetzky calls himself an “actionist,” a buzzy term to describe someone who sees problems in the world and acts to fix them. Empatico is a start. But it looks like his sleepless nights aren’t over yet. “I’m extraordinarily nervous and afraid,” he admits.
Correction: This story has been updated to reflect the number of Empatico’s teacher signups and exchanges, and clarified the director of the KIND radical kindness video and the company’s dispute with the FDA.