What do you do if you’re a famous CEO, and the president of the United States has asked you to serve on his Strategic and Policy Forum, and you’ve agreed to do so – and then the president issues an order forbidding some of your employees from entering the U.S., or from returning home if they live here and were out of the country?
It isn’t a hypothetical question. On Saturday, a Cleveland Clinic doctor returning from an overseas trip was refused entry to the U.S. She was born in Saudi Arabia and also carries a Sudanese passport; she was forced to return to Saudi Arabia. Cleveland Clinic CEO Toby Cosgrove is a member of the Forum. A Clinic spokeswoman told USA Today, “Since this broke, we’ve been very focused on our employee who was denied access to the U.S. and trying to get her back.” This could be seen as attempting to thwart the policy of a president who has frequently excoriated specific companies by name, and whose administration will powerfully influence the regulation of healthcare. But failing to defend a colleague would have sent a terrible message to the Clinic’s 50,000 employees.
That’s the leadership bind facing more than a dozen CEOs – Strategic and Policy Forum members caught up in the weekend’s hurricane of controversy over President Trump’s executive orders on refugees and immigration. The main issue for CEOs is the order banning residents of seven majority-Muslim countries from entering the U.S., even if they’re also legal permanent residents of the U.S., unless they obtain specific approval for re-entry, to be granted or denied on a case-by-case basis. For CEOs like General Motors’ Mary Barra, J.P. Morgan Chase’s Jamie Dimon, Walmart’s Doug McMillon, and PepsiCo’s Indra Nooyi, all of whom serve on the Forum, and all of whom employ over 100,000 people from scores of countries worldwide, the dilemmas are brutal.
Dimon and the rest of J.P. Morgan Chase’s operating committee emailed all employees over the weekend declaring the company’s “unwavering commitment” to them and saying the company has tried to contact “all JPMorgan Chase employees on sponsored visas who are potentially impacted by the recent orders.”
Uber, whose CEO, Travis Kalanick, is a Forum member, and many of whose U.S. drivers are immigrants, yesterday called explicitly for Trump to cancel the order and promised a $3-million legal defense fund for drivers.
Tesla and SpaceX CEO Elon Musk, a Forum member, also bluntly criticized the order, calling it “not the best way to address the country’s challenges.”
Most Forum members have not issued public statements, understandably. Will they speak up privately? That’s exactly what they signed up for. The Trump transition team said last month, “Members of the Forum will be charged with providing their individual views to the President – informed by their unique vantage points in the private sector – on how government policy impacts economic growth, job creation and productivity. The Forum is designed to provide direct input to the President from many of the best and brightest in the business world in a frank, non-bureaucratic and non-partisan manner.” The progress of the immigration storm may give us at least a hint of whether the group is working that way.
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What We’re Reading Today
Volkswagen surpasses Toyota
Despite backlash from the emissions cheating scandal, Matthias Müller‘s company has achieved its goal of being the world’s largest automaker. It sold 10.3 million cars in 2016 vs. Toyota’s 10.2 million. CNNMoney
Koch brothers to fight the border tax
Americans for Prosperity, a Charles and David Koch funded political group, will launch a campaign to fight the border tax that congressional leaders are considering. House Speaker Paul Ryan has pushed the tax as part of a larger U.S. tax overhaul. Fortune
Adviser Steve Bannon’s national security role
President Trump has put Bannon on the National Security Council, though his background is in finance and managing Breitbart News. Bannon has won favor with Trump, telling the president he can accomplish everything he promised in the campaign. Bannon has also wielded influence in choosing Trump’s cabinet. Politico
CSX in talks with activist investor
Hunter Harrison stepped down as CEO of Canadian Pacific Railway earlier this month to join an investor group pushing for management changes at CSX. The railroad and the investors are discussing making Harrison CEO, succeeding Michael Ward, who has run the organization since 2003. WSJ
Building Better Leaders
More companies are using…
…zero-based budgeting, a management tool made popular in the 1970s. It’s a sign that they fear slow revenue growth and will need to boost profits through cost cutting. Reuters
Bill Gates says he would consider dropping out of school…
…to work in three fields today: artificial intelligence, biotech, and energy. Fortune
College degrees needed to work factory floors
As President Trump urges a rebound in manufacturing employment, many such jobs now require more than a high school degree. Siemens USA and John Deere dealerships, for example, offer no roles for someone without education beyond high school. NYT
The Immigration Controversy
Trump defends immigration ban
As protests rage at airports, sparked by President Trump‘s executive order banning travel from seven Muslim-majority nations, he emphasizes that it’s not a ban on Muslims. With few details on execution provided, the order has led to mass confusion at airports and created uncertainty over the status of immigrants traveling into and out of the U.S. Several lawsuits challenge the ban. CNN
Most terrorists don’t come from the nations Trump selected
Trump defends the ban as a way to protect Americans from terrorists, but only 11 of the 180 people who were charged with jihadist terrorism-related crimes or who died before being charged were from the seven countries specified in the ban, and none of those 11 were involved in any major U.S. plot resulting in deaths of Americans. WSJ
Starbucks embraces refugees
In response to the temporary ban on refugees, Starbucks CEO Howard Schultz said the company would look to hire 10,000 refugees worldwide. Google announced a $4-million crisis fund to help those targeted by the order. Fortune
Fortune Reads and Videos
IBM advocates openness…
…in response to President Trump‘s executive order. CEO Ginni Rometty serves on Trump’s CEO advisory group. Fortune
Trump blames Delta for airport delays…
…caused by his executive order, though Delta’s computer problems began well after the immigration orders went into effect. Fortune
Some people have quit their jobs…
…because of Trump. Employees at IBM, SpaceX, and other companies have left their jobs in order to focus on social change or to ensure they weren’t supporting Trump’s message. Fortune
The state with the worst gender pay gap is…
…Wyoming, where women make just 64 cents to every $1 dollar a man makes. Fortune
Quote of the Day
“This executive order sends a signal, intended or not, that America does not want Muslims coming into our country. That is why we fear this executive order may do more to help terrorist recruitment than improve our security.” — Senators John McCain and Lindsey Graham, in response to President Trump’s executive order on immigration. CNN