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Clearing Bull from the Bully Pulpit

Used judiciously, the CEO voice can be a force of change.

CEM_SONNENFELD_GSWhile silence and delayed CEO responses have hurt the brand image, profits and public trust in firms ranging from Chipotle and Carnival Cruise Lines to BP, Toyota and Takata, we are seeing a return of the CEO voice—CEOs standing up to the public podium for comments beyond deals and products, embracing a larger societal mission.

President Theodore Roosevelt famously labeled such a voice from the top, the “Bully Pulpit.” Ralph Waldo Emerson referred to an institution’s leadership as the extended shadow of a single person. For decades, management scholars have highlighted how leaders work as spokespersons to craft meaning and trust.

“In business, if you don’t lead technology, productivity and globalization, you get fired; in politics if you don’t fight them, you can’t get elected. As a result, most government policy is anti-growth.”

Many CEOs have departed from the traditional anonymity of trade-group statements, lobbyists and PR flacks. Our research on CEO impact shows 75 percent of leaders find that lobbying is not working for them.

Apple’s Tim Cook went to ABC TV prime time airwaves to attack the U.S. Justice Department’s request to suspend privacy protections on the iPhone used by a terrorist. Cook labeled this the most important executive action, charging that the government’s request is “the software equivalent of cancer.” He added, “I don’t know where this stops. But I do know that this is not what should be happening in this country.”

GE’s Jeff Immelt also challenged government in his recent annual shareholders report. He complained that the current business cycle is the “worst” he has ever seen due to the difficult relationship between business and government.

“Technology, productivity and globalization have been the driving forces during my business career. In business, if you don’t lead these changes, you get fired; in politics if you don’t fight them, you can’t get elected. As a result, most government policy is anti-growth.”

Jamie Dimon’s latest JP Morgan shareholder letter, much like his candid, constructive, Congressional committee appearances, echoes such concerns. Dimon, like Immelt, is not new to bold public discourse. He and Immelt prophetically warned the business world about risky financial practices a decade ago. In his 2006 annual shareholder letter, he wrote of wide-ranging
mispricing of risk: “We do not yet know the ultimate impact of recent industry excesses and mismanagement in the subprime market. Bad underwriting practices probably extended into many mortgage categories.”

Starbucks CEO Howard Schultz, who has spoken out and acted on societal issues ranging from unemployment and gun control to race relations and nutrition, recently lamented to his
200,000-person global workforce that the current election climate has “turned into something none of us has ever seen before, which I would label as almost a circus of yelling bombastic
attacks, of a lack of respect, of a lack of dignity.”

Campbell Soup CEO Denise Morrison has bolted from defensive industry positions to champion transparency in food labeling and genetically modified ingredients.

Last year, Walmart CEO Doug McMillon urged other business leaders to help revise or repeal societally divisive “religious freedom laws” in states such as Arkansas and Indiana. McMillon stated, “It all starts with our core basic belief of respect for the individual. Today’s passage of HB 1228 threatens to undermine the spirit of inclusion present throughout the state of Arkansas and does not reflect the values we proudly uphold.”

Sure, there are dangers when CEOs assume such inspired statesmanship. Some bold CEOs like Dimon appear to have become prosecutorial targets for speaking out. Also, a CEO must be
careful not to make his or her image and positions barriers to successful problem solving of resolvable underlying conflict.

Still, these times—with massive disruption in politics, diplomacy, trade and technology—are not business-as-usual. CEOs cannot hide behind the protective shields of platoons of PR flacks,
legions of lawyers and bland generic clichés.

About Jeffrey Sonnenfeld

Jeffrey Sonnenfeld
Jeffrey Sonnenfeld is senior associate dean, leadership studies, Lester Crown professor of leadership practice, Yale School of Management, as well as president of the Yale Chief Executive Leadership Institute and author of The Hero’s Farewell and Firing Back.