“When we opened the first Whole Foods Market, we had a simple mission: to provide a more natural food alternative than what most supermarkets were offering,” says Mackey. “Twenty-five years later, we are the largest food retailer of natural and organic foods in the world.”
Mackey pays close attention to what his consumers and critics have to say. In fact, after carrying on an e-mail correspondence with Lauren Ornelas, an animal-welfare activist, for several weeks, Mackey became a vegan and asked for her assistance in changing Whole Foods’ policies on farm-animal treatment.
In April, Whole Foods Market announced it would inform customers that its private-label brands are made with non-genetically engineered ingredients and it is re-evaluating its ingredient auditing processes. “We’ve decided that we’re going to take more of a leadership role on this issue,” says Mackey.
One of Fortune’s 100 Best Companies to Work For eight years in a row, Whole Foods has a unique culture initiated by Mackey. Executive salaries (including his own) are capped at 14 times the average worker’s pay, workers can compare each others’ salaries, insurance is paid in full by the company, the majority of stock options go to non-executives and employees earn above-average wages.
Mackey says that his workers’ and customers’ interests are always put before shareholder interests. “Business by its very nature is part of society and it is intrinsically an ethical institution existing to create value for all of its stakeholders,” he says.
Not that its stock has suffered. Whole Foods had its best year in 2004, with 15 percent comparable-store sales growth leading to a 23 percent increase in sales over 2003, to just under $4 billion. If you had invested $10,000 in Whole Foods Market’s initial public offering of stock in 1992, you could pocket $250,000 today, a substantial 427 percent profit.
“One of our core values is to create a work environment where motivated team members can flourish and succeed to their highest potential,” says Mackey. “So being a great place to work is very, very important to us, and we will work at improving it all the time.”
Committed to wellness and innovation
At the forefront of health and wellness, diversity, horizontal leadership and corporate governance, and a proponent of healthy living, Steven Reinemund jogs his way to excellence. With sales of $29 billion, PepsiCo’s brands include Gatorade, Tropicana, and Quaker – in tune to consumer desires for healthier foods and beverages that taste good.
“We look at health and wellness as an opportunity to be an active part of the solution to the nation's obesity problem,” says Reinemund. “We’ve improved the healthfulness of our existing products by taking important steps like eliminating trans fats in our Frito-Lay chips and reducing sugar in some of our products. We’ve also developed new products that deliver more powerful health benefits, like Quaker Take Heart Oatmeal, which can help reduce cholesterol and help maintain healthy blood pressure – two important factors for heart health. The Tropicana Pure Premium line of fortified orange juices is another great example, and we strengthened the Quaker snack line with new soy crisps and new or improved bar products.”
PepsiCo is also sponsor for America on the Move, a national initiative designed to help Americans achieve energy balance by taking 2,000 more steps and reducing calories by 100 each day. Most recently PepsiCo developed a new Smart Spot trademark in the U.S. and Canada for more than 100 of its products that can contribute to healthier lifestyles.
Offering a balanced and broad portfolio with a range of great-tasting product choices is PepsiCo’s ultimate goal. “While our better-for-you product portfolio is growing at an impressive clip, we also know it’s critical to drive growth in our flagship, heritage brands that comprise our fun-for-you portfolio,” says Reinemund.
A subject close to Reinemund’s heart is corporate governance. "Everyone needs to be accountable for his or her decisions," he said during a keynote address at Harvard Business School. “Rules alone won't prevent another Enron from happening without a strong system of checks and balances and every individual's belief in his or her personal value system.”
Every leader needs to find his or her moral compass, and define their own "true north," Reinemund recently told an audience at the University of Texas. He said moral grounding can come from religion or other sources, but it’s imperative that this center be found before one encounters a crisis situation, so that when the world is coming apart, in your business or personal life, you are able to maintain your balance and not come apart with it.
The other principles he adheres to are: Perspective – look for opportunities and create a vision for how you might capitalize on them; Passion – not to be confused with style or charisma, it’s an "inner enthusiasm for what you are doing that is contagious"; Perseverance – handling failure, and the ability to stumble but get back up is a critical trait of any leader; Performance – great leaders consistently achieve great results themselves, and they reward, promote and value performance by others; and People – each employee is important, because one mistake by one associate can be very costly to the company.
A believer in promoting from within, Reinemund launched an executive leadership program. High-performing senior middle managers in key jobs prepare to become the company's future leaders by focusing on personal growth, as well as corporate strategy, ethics, and promoting change and innovation.