Lessons on the Role of Business in Society, from a Timber Baron

This article was originally published in Corporate Board Member.

Research has long supported the argument that doing good is not antithetical to doing well. The story of the sage but humble timber baron George Weyerhaeuser offers real-world proof—and lessons for boards on navigating their societal mission. Sadly, George passed away this past June at age 95, but his legacy lives on through the wise words he shared with me 45 years ago.

At a time when many timber companies were clear-cutting forests, creating barren fields and destroying animal habitats, Weyerhaeuser embraced selective cutting to preserve the land and protect forest wildlife. He became known for leaving stands of trees along riverbanks to prevent soil erosion.

While other companies used the infamously toxic 2,4,5-T herbicide, Weyerhaeuser acknowledged its dangers and dropped its use years before the EPA banned it. He also quickly supported the federal government’s 1968 creation of Redwood National Park to protect the 800- to 1,500-year-old Sierra Redwoods—the oldest living things in existence. An advocate of sustainable forest management, Weyerhaeuser’s tagline was “the tree-growing company,” at a time when its largest competitors were being attacked as “rapists of the land.”

A Trip to Tacoma

I went to Tacoma to meet with Weyerhaeuser for insight on a 1976 scandal in his own industry. Following a series of successful antitrust prosecutions for price-fixing by forest products companies in consumer papers, multiwall bags, corrugated containers and shopping bags, 47 executives across 22 firms were convicted for price-fixing, with most sent to prison. I interviewed 40 of them as they were released but also spoke with their bosses—who, like Weyerhaeuser, were very frustrated. As one CEO complained, “Either these convicted executives are stupid or they just don’t listen to our legal warnings.”

That was not the way George Weyerhaeuser saw the problem. We met at the unobtrusive company headquarters he had opened within a forest in 1971. The pioneering design allowed natural light to stream in and featured expansive views of the forest’s trees. He greeted me in a sport coat, slacks and hiking boots—a departure from the pinstripes and gray suits of the era. Then, as we hiked through the forest, he shared his corporate conduct philosophy.

Weyerhaeuser’s Way

First, he advised: “Our business is privilege granted by society. We have a license to operate from society. If we violate the intended terms of that contract, it can be revoked by society.” This was a counter to the recently published editorial exhortation by economist Milton Friedman that the social responsibility of business was to increase its profits.

Second, he said, “as a steward of some of the nation’s forests, we think in 20-year increments, given the time to grow trees, and are not distracted by daily market fluctuations.” Thus, the timeframes of day traders and shareholder activists did not dominate his mindset.

Third, he thought he could set the personal model of integrity and responsibility from the top, noting, “My name is on every product, and I try to model our standards.” But over time he came to recognize the need for formal processes to fortify the character of the firm as it diversified. “We bought into paper-converting businesses that had a scrappier, transactional, often unsavory character and were naive about the subculture about acquisitions,” he explained.

Fourth, Weyerhaeuser Company was one of the first companies, along with DuPont and GE, to set up its own Washington government relations offices in the 1970s, having lost faith in the effectiveness of trade associations that seemed to sometimes facilitate misconduct like price-fixing.

An early life experience likely contributed to George’s strength of character. In 1935, at age eight, George was kidnapped and held for ransom, shackled and buried in a pit. Caught and sent to prison for decades, one of his kidnappers expressed remorse. When he was released, George got him a job as a truck driver for the company. “I would be hard-pressed to call him a close friend, but I kind of like him,” George explained. “And I think vice versa. He sends me a card once in a while.”

George Weyerhaeuser was not a “woke CEO,” but a leader who showed us how to blend character, culture, and courage. Or in other words, genuine executive timber.