The conventional business news this week will be dominated by earnings, as a raft of high-profile companies report. But the week’s most important news for business leaders may not be found on the business pages (print or digital). Consider:
-Tuesday. The New Hampshire primary. At this point what can I or anyone say that hasn’t been said? But one insight at least deserves emphasizing: The consequences of the presidential election will be profound for business, and the way things are going, they could be transformational. My colleague Alan Murray explains why in his CEO Daily this morning, which I highly recommend. Although it seems inconceivable, and is still highly unlikely, the consequences for your business of a President Trump or a President Sanders are worth your pondering for a moment. They’ll both probably win on Tuesday.
-Wednesday. NATO defense ministers meet for two days in Brussels to discuss the alliance’s defenses on its “eastern flank,” meaning Russia. President Vladimir Putin is a desperate man as his corrupt, oil-based economy declines, and he learned in Ukraine that aggressive belligerence works wonders for his popularity at home. If NATO decides to strengthen its defenses, perhaps in the Baltics and elsewhere, will he feel the need to respond in some highly visible way? If tension with Russia ratchets up, the EU economy – as a unit, the world’s largest economy – could weaken just as it’s finally starting to grow. Your business would feel the consequences.
-Wednesday and Thursday. Fed chairwoman Janet Yellen testifies to House and Senate committees. As speculation grows that her minuscule December rate increase may be it for the year, the world will be listening for new information or hints. If she still seems to feel that a quarter-point rise – as former Treasury Secretary Hank Paulson describes it, “from almost nothing to a little more than almost nothing” – is all the economy can bear, that’s grim news.
-Thursday. Defense Secretary Ash Carter leads a meeting of defense ministers from countries in the U.S.-led coalition against ISIS. The topic: whether to extend operations into Libya. As a nation in chaos with lots of oil, it’s an ideal new base for ISIS as it loses ground in Iraq and Syria. But would intervening actually disrupt the eventual formation of a government in Libya? More broadly, which would be worse for the world economy – escalating the conflict or letting ISIS operate freely?
The most important news for business isn’t always called business news, as this week emphatically shows.
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What We’re Reading Today
VW vows generous compensation to vehicle owners
Kenneth Feinberg, hired to manage compensation offers after VW’s emissions scandal, says the company isn’t sure if the packages will involve cash, car buybacks, repairs, or replacement cars. He has full authority to make offers, but he can’t move forward with offers to U.S. owners of 600,000 affected vehicles until the company agrees to a remedy plan with authorities. Matthias Müller‘s company last week hired a new U.S. legal chief to expedite the process. Fortune
Chipotle to close today
From 11 am to 3 pm local time, Chipotle restaurants across the U.S. will close so CEO Steve Ells can explain new food safety procedures to workers. Employees will have an opportunity to ask Ells questions about the safety measures. It’s a vigorous response by Ells and co-CEO Monty Moran to prevent E. coli and other food-borne illnesses, which plagued Chipotle over the fall. CNN Money
Bill Clinton unloads on Bernie Sanders
The former president had been reserved until yesterday, when he called Sanders hypocritical and labeled some of the “Bernie Bros” sexist. He reiterated Hillary Clinton‘s talking point that some of Sanders‘s policy plans are pipe dreams and noted a report that Sanders, despite his anti-Wall Street talk, went to fundraisers with representatives from the likes of Goldman Sachs. Washington Post
Doctors play pivotal role in Redstone’s trust
As the 92-year-old billionaire scales back his role at Viacom and CBS by relinquishing the executive chairman title, Sumner Redstone still controls 80% of the voting shares. When he dies or is ruled incapacitated, seven trustees will manage the shares. Under the trust’s terms, he can’t be considered incapacitated until three doctors from different hospitals agree. But first, five close associates, including his daughter Shari and Viacom CEO Philippe Dauman, would have to vote to let the doctors examine Redstone. His purported ailing health has been questioned in lawsuits and by investors. WSJ
Building a Better Leader
In order to reduce bias in your hiring process…
…create a scorecard. It’ll improve the comparisons you make between candidates. Havard Business Review
When attracting investors for your startup…
…focus on one or two qualities that will excite someone about your company. Fortune
While working remotely, don’t forget one-on-one Skype calls
Face-to-face discussions work ten times better than phone calls. SmartBrief
Credit Suisse CEO asks board to cut his bonus
Tidjane Thiam made the request after the bank took a $5.8-billion fourth-quarter loss. It also announced last week that it would cut about 4,000 full-time and contractor roles. Thiam did not suggest an amount for his bonus reduction but noted that his management team took pay cuts as well. MarketWatch
Following Saturday’s GOP debate, Donald Trump…
…maintains a strong lead in New Hampshire with 30% of support from likely voters. Gov. John Kasich ranks second with 14%, while Marco Rubio and Jeb Bush tie for third with 13%. On the Democratic side, Bernie Sanders‘s lead shrunk slightly, but he still holds a 52% to 42% advantage over Hillary Clinton heading into tomorrow’s vote. Fortune
EPA says Flint isn’t the only town at risk
The agency says nearly one-third of the country’s water supply isn’t covered by clean water laws. Much of the problem remains unknown because many water systems haven’t been evaluated. Federal funding for water has dropped 15% since 2006 when adjusted for inflation. With the Flint crisis unfolding, EPA head Gina McCarthy plans to propose stronger regulation in order to prevent another crisis. NYT
Up or Out
Brixmor Property Group has named Daniel Hurwitz interim CEO after CEO Michael Carroll, CFO Michael Pappagallo, and Chief Accounting Officer Steven Splain all resigned in the wake of findings that questioned the company’s accounting practices. Yahoo Finance
Fortune Reads and Videos
India stops Facebook’s Free Basic service
A net-neutrality ruling prohibits charging different prices for different data services. Fortune
Venmo falters shortly after the Denver Broncos win the Super Bowl
The online payment service seized up; apparently many Carolina Panthers fans lost more than just the game. Fortune
The winner of the Super Bowl ad race…
…definitely wasn’t Mountain Dew’s #puppymonkeybaby. Fortune
The FBI is investigating a potential $500-million…
…health care fraud involving the sudden rise of pain creams that may have no health value. Fortune
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|Produced by Ryan Derousseau|