Ken Frazier, the CEO of Merck & Co., may not have meant it this way, but he managed to put 27 of his fellow corporate CEOs and other business leaders on the hottest of hot seats Monday.
That’s when Frazier resigned from President Trump’s manufacturing jobs council. His aim plainly was to protest Trump’s wholly inadequate response to the violent white supremacist rally this weekend in Charlottsville, Va. “America’s leaders must honor our fundamental values by clearly rejecting expressions of hatred, bigotry and group supremacy,” Frazier said in a published statement. “As CEO of Merck and as a matter of personal conscience, I feel a responsibility to take a stand against intolerance and extremism.”
Frazier’s action raised a number of questions, but one stands paramount: Why haven’t the other members of Trump’s jobs council followed his example?
It is important for GE to participate in the discussion on how to drive growth and productivity in the U.S.
The membership of the jobs council, which Trump announced on Jan. 27, is composed of some of the glitterati of the corporate world. Present are the CEOs of Dow Chemical, Dell, Whirlpool, General Electric, Intel, Boeing and 3M, along with not one but two officers of the AFL-CIO. As is the case with almost all such advisory bodies, getting their names on the list was pretty much the whole point. The council “has yet to hold any real meeting,” the AFL-CIO says, which is routine for such PR-driven fronts. It’s crystal clear that even if it does meet, it will be “advising” a patron who doesn’t listen to advice.
Nor is this panel the only such decorative White House chandelier CEOs are hanging from; there’s a “strategic” council that includes Wall Street CEOs such as JPMorgan Chase’s Jamie Dimon and IBM’s Ginni Rometty (who hardly needs to waste her time with Trump instead of working harder to keep her company from going down the tubes).
The longer any of these people remains on the council, moreover, the more Trump’s policies and behavior will get hung around their necks. One of the first CEOs to act on this realization was Elon Musk of Tesla Motors and SpaceX, who resigned from the jobs and strategy councils council and the on June 1 after Trump announced America’s withdrawal from the Paris climate agreement. Musk tweeted, “Climate change is real. Leaving Paris is not good for America or the world” — advice that Trump, obviously, ignored.
The longer any of these people remains on the council, moreover, the more Trump’s policies and behavior will get hung around their necks. One of the first CEOs to act on this realization was Elon Musk of Tesla Motors and SpaceX, who resigned from the jobs council on June 1 after Trump announced America’s withdrawal from the Paris climate agreement. Musk tweeted, “Climate change is real. Leaving Paris is not good for America or the world” — advice that Trump, obviously, ignored.
I reached out to 22 of the 25 companies still represented on the jobs council (the others didn’t seem to have usable contact numbers or emails), as well as the AFL-CIO and the industry group Alliance for American Manufacturing, which is also represented on the council. As I write, eight corporations and the union have responded.
General Electric issued its own pro forma condemnation of “hate, bigotry, or racism, but said its chairman, Jeff Immelt, will remain on the board until his retirement Dec. 31 because “it is important for GE to participate in the discussion on how to drive growth and productivity in the U.S.” It didn’t say, however, how it can participate in the discussion through membership on a council that doesn’t meet. U.S. Steel said that its representative on the council, Mario Longhi, retired as CEO on June 30, so he’s no longer a member of the council, and left it at that. Boeing said its CEO, Dennis Muilenberg, will stay on the council
Late on Monday, Kevin Plank, founder and CEO of the sporting garb company Under Armour, said he would leave the council, although his statement was less pointed than Frazier’s: “Under Armour engages in innovation and sports, not politics,” he said. In February, Plank took criticism for public comments that supported Trump, including from NBA star Stephen Curry, who endorses Under Armour products.
Also late Monday, Intel’s Brian Krzanich became the third CEO in a day to leave the Trump council. In a post on the company’s blog, Krzanich said he resigned “to call attention to the serious harm our divided political climate is causing to critical issues, including the serious need to address the decline of American manufacturing.” He added: “I have already made clear my abhorrence at the recent hate-spawned violence in Charlottesville, and earlier today I called on all leaders to condemn the white supremacists and their ilk who marched and committed violence….We should honor – not attack – those who have stood up for equality and other cherished American values.”
Am departing presidential councils. Climate change is real. Leaving Paris is not good for America or the world.— Elon Musk (@elonmusk) June 1, 2017
The AFL-CIO, whose president, Richard Trumka, is on the council, said it’s “assessing our role” and acknowledged “there are real questions into the effectiveness of this council to deliver real policy that lifts working families.” One must ask, how long could it possibly take to perform this sort of “assessment”?
What is demonstrated by these responses — and the silence from other council members — is corporate America’s devotion to totally vacuous gestures. But it becomes clearer with every passing day that lending their credibility to Trump is dangerous, to their own reputations, to the U.S. economy and to the health of the republic.
Some of the CEOs on Trump’s jobs council may be making a strategic decision that it pays to play footsie with this childishly unpredictable President as long as they can. Some of the members, such as Boeing and Lockheed Martin, could give a correspondence course in the presidential tweets that can erupt when a company ticks him off. Merck’s Frazier felt his wrath on Monday, shortly after he resigned from the council, when Trump responded via Twitter that now that he had resigned, “he will have more time to LOWER RIPOFF DRUG PRICES!” (Emphasis in the original.)
Now that Ken Frazier of Merck Pharma has resigned from President's Manufacturing Council,he will have more time to LOWER RIPOFF DRUG PRICES!— Donald J. Trump (@realDonaldTrump) August 14, 2017
One can understand a CEO’s reluctance to expose his or her company to this treatment, just to wriggle off an “advisory” council that does nothing anyway. But we’ve reached the point where that facile approach will no longer do. Retaining membership in Trump’s business councils makes a company complicit in everything he represents: his punitive immigration policies, his climate change denialism, and now his embrace of white supremacist and Nazi sentiments. His true feelings are expressed through the tenor of his public statements, his reluctance to take a stance of moral leadership, and his employment in the White House itself of personnel aligned with those sentiments.
Pro forma statements expressing dismay at racist violence and at hatred and bigotry are only the stuff of media relations. The day will come when American corporations will be asked what they did to fight back — not merely what they said. Until the companies still on Trump’s business councils abandon him, the answer will be: “We did nothing.”
3:10 p.m.: This post has been updated with Boeing’s statement that its CEO will stay on the Trump council.
6:35 p.m.: This post has been updated with the announcement that Under Armour CEO Kevin Plank also will leave the council.
8:03 p.m.: This post has been updated with Intel CEO Brian Krzanich’s resignation from the council.
10:00 a.m., Aug. 15: This post has been updated to reflect that Ford has not been represented on the council since the retirement of CEO Mark Fields in May.