Day: August 20, 2017

Did CEO “Grandstanding” Further Seal The “Markets” Fate?

There was a time when business and politics kept each other at arm’s length for fear of the political/business optics. Today, it would seem, far too many CEO’s are primarily concerned about their political optics – than their business concerns.

Regardless of what side of the political spectrum one finds themselves, one thing is abundantly clear: Clearer heads, on both sides, are being drowned out by the endless, mindless, screaming, ranting, and just plain nonsensical arguments for having the “right” to not only feel a certain way, but demonstrate those “rights” and “feelings” via anarchy, property destruction, melee, and more. And that’s just the mainstream media.

Why the above is germane to the headline is for this reason: Regardless of where one stands politically, business leaders are supposed to demonstrate both publicly, as well as fiduciary, an apolitical stance or bias. In other words, when it comes to all matters of business: politics is something to be eschewed, at least in public, much like the old warning we grew up with. i.e., Don’t talk politics or religion in mixed company.

However today when it comes to business, it seems far too many CEO’s, both big and small, can’t cozy-up close enough or fast enough. But that’s not all: they now appear to be bordering on apoplexy to not only publicly espouse their own political views, but also, enforce that view company wide on their staff and others.

One current aberration of this phenom is playing out at Google™. Yet, that is far from the only one. And the implications for this phenom in its seemingly ever-expanding “reasoning” for outrage may have just manifest itself in a “trigger” event many of these same CEO’s will come to regret. For as that other old saying goes, which they are now arbitrarily applying solely to the President: Actions, as well as words, have consequences.

Here I’m speaking directly to ever-growing list of CEO’s either distancing themselves from the current administration outright (and the President in-particular) along with those whom resigned from his Business Advisory Council, causing the President to disband it in its entirety as to stop the political “grandstanding” as he called it.

Personally, I believe he has a point.

Although the current political firestorm with regards to the President’s initial statements about Charlottesville has differing degrees of merit. The outcry that the President is both a Nazi, or White Supremacist sympathizer, and, is in some way the symbolic, as well as sympathetic leader for all of those who voted him into office, implying that they too are to be considered the same? (i.e., white supremacist sympathizers) Is utter, sheer idiotic, lunacy. Period, full stop.

The most that could be argued via any reasonable debate is: that the President is guilty of delivering a poorly worded statement, in the heat of the moment, to what can only be deemed as a mindless, tragic event.

Again, if one stands back and accesses the facts, at most, he showed he was far more the inarticulate politician or statesman than anything resembling the outpouring of condemnation now being thrust upon not only him, but his administration, and the people who voted for him. It’s now reached hysterics in nature. And the “markets” took notice.

So why did the “markets” buckle, again, when the so-called “bounce” had all but erased its prior descent?

Was it because there would now be a sudden halt in the great business expansion these CEO’s have delivered to the bottom line of U.S. GDP over the last 9 months?

No, the “markets” reacted negatively because these CEO’s seemingly put another nail in the only thing holding this “balloon” known as “markets” aloft. i.e., The “Trump trade” itself. That’s what’s now become fundamentally obvious.

As one CEO after another seemed to take to the media with their declaration for distance, so too did more politicians. After all, politicians will not stand idly by while anyone else is getting press coverage. Regardless of topic. And once their pile on emerged the “markets” took the cue: i.e., The “hopium” trade is officially over.

Think about that very carefully, don’t take my word for it. And think now of the implications. Why? Because the “market” seems to be doing just that. And it’s reaction was very telling.

I’ve been asked, “What should have been the response from any of these CEO’s as it pertained to the President and the Charlottesville tragedy?” I believe it should have been something along these lines:

First: When it comes to working (as in advising) the President of the United States via either a council, together with other business leaders, or, if the President alone was just seeking their council individually as it pertained to conducting business in the U.S., which has/had (as it very well should) the best interest of its citizenry at heart? No business leader worth-their-salt would hesitate to offer it – if – it was being asked in earnest. Regardless of who is, was, or about to hold the office, no matter which side of the political aisle. And – regardless if that President, whoever it may be at the time, seemed to be swarmed with some other political debacle. And here’s why…

A business leader (regardless of stature) should advise purely on implications as they pertain to the business sector. Anything other than offering true business insights would flirt with calls for crony capitalism, and would be warranted. For once one goes from the business discussion to the political? It’s no longer about true business – and that’s all a business leader being called on for business advice should be concerned with. If  – they’re honest about it.

That’s what I believe should be the duty of any CEO, both as a U.S. citizen, as well as in fulfilling their fiduciary responsibility to their company, shareholders, and employees. Period.

Why? Because when the President of the United States calls asking for your help, for the good of the country? You pick up the phone and say, “How can I help?” No matter who is occupying the office at that particular time.

This also insulates the CEO from any calls of political alignment issues. Why? Because when the calls come for “Why are you still on his ________ ” (fill in the blank) The answer is to unabashedly state the above line.

But that’s not what’s happening. And, in actuality, the “grandstanding” remark may not be that far off than is alleged.

The reason why I say this comes from none other than the latest actions for political optics via Tim Cook, CEO of Apple™.

It was one thing to resign from the council, but Mr. Cook took it to 11 on the political scale when he announced not only his reasoning, but his declaration that not only was he donating via Apple $1million a piece to two civil rights organizations, but also – will match 2-for-1 any additional donations made via employees as an incentive to also donate.

The issue here is two-fold. 1) He’s doing this via company coffers. 2) What happens to those who don’t feel the same as Mr. Cook and don’t donate, for whatever their reasoning? Is there now implied peer pressure on the job? Will there be lists as to who did, and who didn’t? Do share holders agree or feel the same way about this political decree?

The list goes on, and on. And they’re fair questions because Mr. Cook is arbitrarily applying Apple’s stamp to his political views. That’s not business in my book. That’s pure politics and does not belong.

Again, Mr. Cook is free to do whatever he wants with his own money. But once you start invoking, and involving Apple’s coffers as a funding mechanism for the political statement? You suddenly shine a light where maybe it was best to not bring attention to it to begin with. The political optics are not in either Mr. Cook’s nor Apple’s as a company favor. Let me explain.

It wasn’t the act itself that raised eyebrows, but rather, precisely whom one of those two recipients were that raised not only eyebrows, but hairs on the back-of-necks in unison. e.g., The Southern Poverty Law Center (SPLC). (The other was the Anti-Defamation League.)

The SPLC is regarded by a great many (and not by zealots, but by seasoned political watchers, reporters, and thinkers) to be at the heart of much of the current vitriol that is fueling a lot of the so-called inflammatory rhetoric. And now via Mr. Cook’s actions it could be deemed – Mr. Cook is directing company funds into what many deem “the heart of the beast” when it comes to outcries for division and its tactics. (Again, this is opinion based on documented findings and reporting done on the SPLC by others. I’m just adding further analysis or constructs too it.)

To make the point clear: Mr. Cook is by all means entitled to donate whatever political funds to the entity of his choice. As long as they’re his funds. e.g., Private.

However, once Mr. Cook declared it would be Apple’s coffers that would donate the $millions, and, simultaneously match two-for-one of its employees doing the same? That’s where things change from apolitical – to pure politics. And once it’s deemed political. Everything, as far as questioning and more  – is fair game. And his actions brings both the company, as well as all of its employees, products , and shareholders – straight into one of the most contentious political firestorms as a now representative icon funding a political side, view.

This is anathema to what a CEO of just a few years ago would ever consider as a proper business decision. Why?

To use an old Apple slogan “Think different.” Think this: What would be the reaction should a SPLC protester arrive carrying just one Apple banner, or logo, on a flag? Think it’s crazy? The issue here is – if just one did and it hit the media? Apple can’t say they don’t support it. Mr. Cook has just made that argument moot.

The President, can be argued, botched what should have been an easy renunciation of all those concerned. Anyone with a modicum of objective reasoning can see it was a ham-fisted delivery error only, and nothing more. And yet, it’s been turned into a no-win political error which no act of contrition will please. Apologize – and it’s said it shows his guilt. Don’t apologize – and it’s shouted it’s the same. And that’s just the media.

On the other hand, from a business perspective, there’s nothing to be nuanced or to equivocate when it comes to Mr. Cook’s reaction. And it is he that seems the most concerned with optics.

Again, for this point is at the very heart of the matter: He has unequivocally announced he is going to use Apple’s coffers to help fund what many believe to be one of the principle players (e.g., SPLC) or “the belly of the beast” right along side others in kind funded by none other than George Soros that help stir up vitriol with calamitous consequences in the first place. That’s not my opinion, that’s a general observation, and opinion held via the public at large.

There are many, on both sides of the political aisle, that believe the SPLC to be one of the main players in helping to fan the flames of anarchist type rebellion. And Mr. Cook is not worried about the optics of donating what may amount to $millions via the coffers of the one of the world’s wealthiest, and largest corporations?

If that’s not political “grandstanding” as to proclaim solidarity with one political vision over another? Then what is? Because it sure isn’t business – that’s for sure.

This is what the Fed. has wrought us. CEO’s with so much time on their hands they can be more concerned with their political views, than their business views.

But I believe that’s all about to change. And change quickly. For just wait until the Fed. weighs in ever-the-more over the coming weeks. I believe they’ll be a lot more pressing business issues to contend with, or to be preoccupied with, as the final nails are driven into the “Trump trade.” That is – if the “markets” wait that long. Because with all these CEO’s openly swinging hammers?

Those nails may have already been hammered home.

© 2017 Mark St.Cyr