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How Not to be the Next CEO to Step in It

November 29th, 2016 · No Comments

GrubHub CEO Matt Maloney (center)

GrubHub CEO Matt Maloney (center)

The following op-ed was written for Crain’s Chicago Business.

By Ron Culp

Public relations leaders usually encourage their C-suite executives to actively engage in policy issues affecting their businesses, but recent missteps by two CEOs might actually scare many others from speaking out. That would be against their best interests.

Voicing a candid point of view can humanize a CEO and can deepen relationships with employees, customers and investors. But today’s charged and instantaneous social media atmosphere significantly increases the risk of repercussions following hasty engagement. Just ask the CEOs at GrubHub and Penzeys Spices.

In the emotional fury that followed Donald Trump’s unexpected election victory, GrubHub’s Matt Maloney shot off an email telling employees harboring “hateful attitudes” to resign. It was interpreted by many to mean “if you voted for him, leave.” What he may have thought was a memo supporting tolerance and inclusion backfired “bigly”, spurring a #BoycotGrubHub Twitter storm and a 5 percent stock price drop.

While Maloney was still getting singed on social media, Bill Penzey sent an impulsive email to customers of his suburban Milwaukee-based spice company. Penzy, known for expressing his progressive points of view, claimed that “the open embrace of racism by the Republican Party in this election is now unleashing a wave of ugliness unseen in this country for decades.” Like GrubHub, Penzey issued a clarifying (but still spicy), statement a couple of days later.

So should CEOs take sides on contentious political and social issues?

My resounding “yes” is supported by corporate historian Bruce Weindruch, who says, “CEO political or social stands that logically support corporate goals generally end up on the right side of history.” Others, however, are often punished for taking unnecessary or poorly thought out positions.

Rules governing political and public policy stances are evolving rapidly as a result of the enormous influence of social media. Weber Shandwick’s reputation management guru Leslie Gaines-Ross confirms that whatever side CEOs take on a contentious issue, they need to be fully prepared for the possibility of a social media firestorm. “Invariably, some stakeholders will feel aligned and others will feel alienated,” she correctly warns.

Bottom Line: It’s critically important to weigh the upside with the downside of any public position. As Gaines-Ross recommends, “CEOs and their teams must carefully vet the pros and cons of CEO activism and proactively tie it to their values so their words and actions are clearly understood.”

Vetting rather than venting is what Maloney and Penzey should have done before pushing the send buttons on their computers.

Over the years, the following basic “rules of engagement” have averted difficult backpedaling for both myself and the CEOs I have advised:

1. Take a deep breath and count to 10 before responding

2. Better yet, write it, but sleep on it overnight

3. Read it out loud multiple times

4. Get a second and even a third opinion

5. If still in doubt, delete

These rules can apply to anyone, not just CEOs. And they easily can be adapted for social events and upcoming family gatherings during this potentially fraught holiday season.

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