Good morning.
I’m in Chicago, where last night we brought together two dozen local business leaders to discuss ideas for our September conference here, Brainstorm Reinvent. There was lots of enthusiasm for the event. All agree that technology is going to bring profound change to virtually every industry in the next decade. One interesting debate was whether legacy companies could get good at technology fast enough to fend off the tech companies’ invasion of their businesses. That’s a battle we’ve been fighting in media for decades; now it’s hot and heavy in the automobile business—Can GM develop great technology before Elon Musk figures out how to fix his operating mess? We’ll plan to make those sorts of debates central to our September event, which you can learn more about here.
Meanwhile, it’s Friday, so time for some feedback.
PM was unimpressed with our World’s Greatest Leaders list:
The left-leaning press lauds leaders who support left-ish causes, even if it’s a minor business disaster—And a year and a half after Donald Trump is elected President to its utter surprise it finally begins to recognize that power is now flowing from the bottom up! Maybe you should hire some folks who subscribe to right-leaning news feeds
And JC was skeptical of Salesforce’s push for equal pay for women:
Equal pay for equal work status doesn’t equate to equal achievement or output. The financial rewards at most companies go to the people that produce the most or know how to be a team player. Equal consideration and fair treatment is a standard all companies should aspire to, but perfection is impossible to achieve.
Readers are always welcome to disagree, but I stand behind both posts. News below.
| Alan Murray | |
| @alansmurray | |
| alan.murray@fortune.com |
Top News
Shire Pandemonium
Ireland's Shire yesterday rejected a $60 billion takeover offer from Japan's Takeda Pharmaceutical. However, this morning the U.S. botox firm Allergan pulled out of making a competing bid, after its shares fell 6% on the news that it was considering it. Shire's shares (say that twelve times fast) are down 4.4% at the time of writing, while Takeda's are down 4.7%. A Shire takeover would probably be the second-biggest in the history of the pharma sector. Financial Times
Aluminum Glut
Does anyone want to buy lots and lots of aluminum? Anyone who isn't in the U.S. or one of its allied countries, that is? United Co. Rusal, hit with U.S. sanctions because Russian oligarch Oleg Deripaska heads it up, is currently trying to find a buyer for the many tons it produced but did not place on exchanges before the sanctions hit. Russia is the most obvious potential buyer, but it does look like the aluminum markets will have to deal with a vast stockpile being out there for a while. Wall Street Journal
ZTE Fallout
The Chinese networking equipment and smartphone maker ZTE has warned that its days might be numbered due to the U.S. ban on supplying it with parts and software for the next seven years. However, it has also warned that the ban will "cause damages" to its U.S. partners, which have included chipmaker Qualcomm and Android-backer Google. CNBC
Deutsche Bank Boo-Boo
Deutsche Bank last month accidentally sent $35 billion to Deutsche Boerse's Eurex clearinghouse as it was conducting a daily collateral adjustment. It spotted the error quickly and there was no financial harm, but it does somewhat undermine the claims of former CEO John Cryan that the bank's internal controls were strengthened under his watch. Fortune
Around the Water Cooler
The All-Seeing Palantir
Bloomberg has a strong piece on Peter Thiel's Palantir, and the scandal that ensued at JPMorgan when the head of an insider threat group went rogue and used the data-mining firm's services to spy on the top brass. "Former JPMorgan colleagues describe the environment as Wall Street meets Apocalypse Now," reads one line. Palantir is a secretive company that sells its services to companies and governments around the world, with many privacy advocates decrying the consequences. Bloomberg
AMP Scandal
The CEO of Australian wealth manager AMP has resigned after an enquiry found it had routinely charged customers for service that were not delivered. AMP admitted lying to the Australian Securities and Investments Commission, not just once, but consistently over more than a decade. Craig Meller quit saying he was "personally devastated" by the revelations and that he did not condone the misconduct nor the lies. BBC
Comey Memo
In the latest less-than-edifying episode of the Trump/Comey saga, it's emerged that the former FBI chief wrote a memo of a meeting with the president in which the latter spoke about the beauty of Russian prostitutes. Comey's memos, which have been turned over to special counsel Robert Mueller, cover Trump's distress at the allegations contained in the Steele dossier, one of which involved supposed encounters with Russian prostitutes in Moscow. Comey wrote: "The President said 'the hookers thing' is nonsense, but that Putin had told him 'we have some of the most beautiful hookers in the world.'" The Telegraph
Starbucks and Racism
Richard J. Reddick, associate professor of educational leadership and policy at the University of Texas, writes for Fortune that some people of color might be cynical about Starbucks' response to the crisis that was precipitated by a store manager calling the cops on two black men sitting at a table (after a mere couple of minutes of them not buying anything.) "Many of us will be watching to see whether the May 29 racial bias training is successful—and what Starbucks commits to beyond this single day," he says. Fortune
This edition of CEO Daily was edited by David Meyer. Find previous editions here, and sign up for other Fortune newsletters here.