It’s time once again for Do This, Not That. The contrast is between two family companies, both of which are in the news and both of which have a boss’s daughter high in the corporate hierarchy who may or may not become the boss. One is a thriving success, and one is a mess. Conveniently, both of today’s case studies are described in terrific new stories at fortune.com.
-Do This. I suspect that most people, if asked to name the world’s largest car-rental company, would get it wrong. The correct answer is Enterprise, with $19.4 billion of revenue last fiscal year, 93,000 employees, and 1.7 million cars. Chrissy Taylor, 39, daughter of former CEO Andy Taylor and granddaughter of founder Jack Taylor, was named chief operating officer yesterday. No surprise, no drama, as one gathers from Valentina Zarya’s article introducing you to Chrissy, whose profile has been low. She started at the company the way all new college grad employees do – washing cars – and has progressed through a series of operating and staff jobs in the U.S. and abroad that have prepared her for top management. It would be no surprise at all if she were eventually to become CEO, but when asked about it, she won’t go there, saying only, “I would love that, but one step at a time.” The top job is not reserved for Taylors; the current CEO is Pam Nicholson, who isn’t a family member.
Enterprise is privately held, and Andy Taylor told Fortune’s Carol J. Loomis in 2006, “I can’t imagine that we would go public.” Families do that, he said, only “if they lack a consensus – if everyone wants to take a piece.” And if you want to see a family that lacks consensus, look at the other side of today’s contrast.
-Not That. Peter Elkind details the public brawl over the future of Sumner Redstone’s empire, and you can’t help wondering how things went so wrong. Yesterday Redstone, 92, resigned as executive chairman of Viacom, which he controls, and the board named CEO Philippe Dauman to succeed him, over the objections of Redstone’s daughter, Shari Redstone, who is Viacom’s vice chairwoman. On Wednesday Redstone resigned from the same position at CBS, which he also controls, and was succeeded by CEO Leslie Moonves with the support of Shari, who is also vice chairwoman there. Succession issues resolved? Just the opposite, as Elkind shows.
The real prize is control of National Amusements, the privately held company through which Redstone holds 80% stakes in Viacom and CBS. If he were to die or become incapacitated, control would pass to a family trust governed by seven trustees, who include Dauman and Shari. Shareholder lawsuits, which Redstone is fighting, seek to have him declared incapacitated. If that happened, a family trust could reportedly make Shari executive chairwoman of CBS and Viacom. But Shari and her father have fought bitterly and publicly over exactly what that means.
The fundamental problem is an old story: the patriarch who can’t bear the thought of giving up power, ever. Believing himself unique among all living things, Redstone has said, “I’m not going to die.” He softened his position back when he was 84 and said he expected to live another 50 years. Facing reality instead might have been the better strategy.
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What We’re Reading Today
Viacom CEO Philippe Dauman becomes chairman
Dauman replaces Sumner Redstone after the 92-year-old billionaire stepped down yesterday. But Dauman’s rise has a contentious wrinkle, since Redstone’s daughter Shari, Viacome’s vice chairwoman, opposed Dauman’s elevation. She cast the board’s lone dissenting vote. Redstone’s resignation comes as investors grow louder in questioning his competence to run Viacom and CBS, both of which he controls with 80% stakes through his privately held National Amusements. Fortune
Obama proposes $10-a-barrel oil tax
When President Barack Obama sends his budget request to Congress next week, he will include a $300-billion clean transportation initiative to increase funding for mass transit projects, self-driving cars, and high-speed rail for the next ten years. To pay for the package, he will propose the $10-a-barrel tax on oil companies, which analysts say would likely lead to a maximum 25-cents-a-gallon increase in gasoline at the pump. The proposal has virtually no chance of passing a Republican-held Congress, but the president wants to start the conversation. It puts Hillary Clinton in a bind, since she’s a supporter of the president but has vowed not to raise taxes on families making less than $250,000 a year. Politico
NFL to add Rooney Rule for women
The rule announced by Commissioner Roger Goodell will force teams to interview women candidates for executive-level openings. The Rooney Rule requires teams to interview minorities when filling head coaching positions and senior jobs that oversee football operations. Whether the rule has increased hiring of minority candidates is unclear. NBC Sports
State Dept. finds classified information sent to personal emails…
…of former Secretaries of State Colin Powell and aides to Condoleezza Rice. Two emails classified as “secret” or “confidential” were sent to Powell and ten to Rice’s aides during President George W. Bush‘s administration. Hillary Clinton has argued that her use of personal email has been overstated for political purposes, since others had done the same. The State Dept. has found 18 instances of emails classified as “secret” being sent to her personal account and 1,564 instances involving emails with “confidential” information. NYT
Building a Better Leader
To develop innovation you need diversity of thought
But don’t forget that you also need vast knowledge in the domain you work in. Knowledge@Wharton
If you really want to stand out in the office…
…ask, What’s my motivation for being here? Fortune
With new healthcare reporting laws taking effect…
…small businesses are struggling to understand their complexity. Associated Press
At the Democratic Debate
Clinton and Sanders argue over the meaning of “progressive”
Asserting that Hillary Clinton isn’t progressive enough has been a common theme of Bernie Sanders‘s attacks. The debate got heated last night as she said she’s a “progressive who gets things done” while Sanders, she said, wants to dismantle Obamacare and provide Medicare for all. Sanders argued he helped write the Affordable Care Act, and she mischaracterizes his position. USA Today
Clinton gets angry
Taking a more forceful tone in last night’s debate, Clinton argued that Sanders‘s desire to run a positive campaign is a farce. Pointing to his frequent criticism of her Wall Street speeches as an example, she said, “Enough is enough. If you’ve got something to say, say it directly.” Her anger, some felt, came across as relatable rather than as complaining. Fortune
Sanders gets more airtime
In the first debate since Martin O’Malley suspended his campaign, Sanders received more attention. He continued with his calls to reform a rigged economy and fix campaign finance. When the subject turned to foreign policy, though, he struggled with some answers and rambled at times. He continues to remind voters that he didn’t vote for the Iraq war in 2002, as Clinton did. The Atlantic
Up or Out
Christine “Chrissy” Taylor has been named COO at car rental company Enterprise. Fortune
Fortune Reads and Videos
Mattel and Hasbro in talks for a toy merger
It would combine the two largest (by far) toy makers in the U.S. Fortune
LinkedIn shares are tumbling…
…because investors are worried about the future. Company forecasts came in far below analyst expectations. Fortune
Blackrock’s CEO may be making a play for Treasury Secretary
Larry Fink‘s proposal on changing the tax code to encourage long-term investing mirrors a proposal of Hillary Clinton‘s. Fortune
KFC will debut another Colonel Sanders in Super Bowl ad
It will be the company’s third spokesperson since May. Fortune
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