CEO Peer Pressure Works
Some of the CEOs headquartered in Georgia are now speaking up more authoritatively about the restrictive voting rights law that passed there. There are many reasons ascribed as to the motives behind Delta’s CEO Ed Bastian and Coca-Cola’s CEO James Quincey speaking out against the new legislation. Even Tim Cook of Apple added his opinion to the small chorus so far. The reasons include: people threatening to boycott their products/services, employees anger about misalignment with company values, customer demands and not having paid enough attention to what was in the new law. Experts, the media and luminaries are criticizing CEOs for not speaking up sooner.
I think, however, that the most significant lever that changed CEO positions was the 72 Black executives who signed an open letter appearing in the New York Times this week calling on companies to fight against limited voting bills. Among those Black executives were Merck’s CEO Ken Frazier, former American Express CEO Ken Chenault and Starbucks’ chairwoman and co-CEO of Ariel Investments, Mellody Hobson. This peer-to-peer pressure from Black executives to mostly white executives, many of whom knew each other well from the Business Roundtable or global CEO forums, pushed the latter group to make the hard decision about sticking to their core values and fighting racial injustice. As Chenault said: “There is no middle ground here. You either are for more people voting, or you want to suppress the vote.” The coalition of Black executives raised the temperature to hot.
I recall vividly studying CEO responses to Charlottesville as part of our drilling down into CEO and corporate activism. If you recall, violence exploded in Charlottesville on Aug. 12 after hundreds of white nationalists and their supporters gathered for a rally over plans to remove a Confederate statue and were met by counter-protesters. The rally and resulting death and injuries resulted in a backlash against white supremacist groups in the United States. Former President Trump condemned both neo-Nazis and white nationalists but also referred to "very fine people on both sides." Many saw his remarks as sympathetic to white supremacists.
Over the course of the week following the events in Charlottesville, a total of 64 companies responded. Response peaked on August 14 with 23 responses on that single day sparked by Merck’s CEO Ken Frazier who resigned from the president’s council. Frazier’s brave action changed the dynamic of CEOs speaking out about racism, particularly over an incident that may have had little to do with the core business of pharmaceutical giant Merck and everything to do with moral leadership. Frazier seized the moral authority missing from the bully pulpits across America.
Source: Weber Shandwick 2017
My sense is that much of CEO and/or corporate activism requires an accelerant to get it going. Apple’s Tim Cook or Salesforce’s Mark Benioff were often the early sparks to corporate activism. Back in 2016, the NBA moved its 2017 All-Star game out of Charlotte, North Carolina, following laws that limited anti-discrimination protections for the LGBTQ community. The precedent was set. MLB just announced its All-Star Game out of Atlanta in response to Georgia’s voting bills that are perceived to disproportionately affect people of color, an action that commissioner Rob Manfred on Friday said is the “best way to demonstrate our values as a sport.”
According to Newton's third law…for every action, there is an equal and opposite reaction. That seems to be the case here where Georgia’s voting bill pushed Black executives to react equally to an opposition of greater voting rights. CEOs are on the march when it comes to equal voting rights in 2021.