Travel Ban, China Retreat, Uber Victory: CEO Daily for June 27, 2018
Delta CEO Ed Bastian told Fortune’s CEO Initiative yesterday that he didn’t check with his board before making the decision to end discounts for NRA members after the Parkland shooting. “At Delta, our values are everything,” Bastian said. “It is the culture of the company. It allows us to be who we are.” He said the tone of “the commentary coming from the NRA and seeing Delta’s name in the midst of the discussion going on… we just couldn’t be there.”
Bastian said the decision led the Georgia state legislature to kill a tax break worth $40 million a year to the company—a high cost to pay. But he said he has no regrets, and that he got “nothing but support from directors.”
“If my board had questioned that decision making, they would question me as a CEO. I thought it was that black and white.” Bastian says the company has since reviewed the full range of discount programs it provides to various organizations, and cancelled about 20 others that he found unacceptable. He said the NRA discount was ultimately used by only 13 people.
Bastian’s comments, along with those from Apple CEO Tim Cook the previous evening, sparked a lively conversation among the assembled CEOs over the question of when it is appropriate for CEOs to speak out on controversial political and social matters. Most of the CEOs said they are under increased pressure from their employees to take stands on hot-button issues. And most said they are struggling with how to set guidelines for how and when to respond.
Coincidentally, Buzzfeed reported yesterday that some 650 Salesforce employees petitioned their company to stop its work with the U.S. Customs and Border Protection. “Given the inhumane separation of children from their parents currently taking place at the border, we believe that our core value of Equality is at stake and that Salesforce should reexamine our contractual relationship with CBP and speak out against its practices,” the petition, addressed to CEO Marc Benioff, reportedly read.
A Salesforce representative said the company “is proud of our employees for being passionate and vocal, and will continue the conversation on this and other important matters.”
You can read more about the CEO Initiative here. Other news below.
The Supreme Court has upheld President Donald Trump's travel ban, which restricts people from several Muslim-majority nations, as well as North Korea and Venezuela, from travelling to the U.S. However, there was strong dissent from Justices Sonia Sotomayor and Ruth Bader Ginsburg, who said Trump's promised Muslim ban was hiding "behind a façade of national-security concerns." Meanwhile, a federal judge has also ordered the Trump administration to reunite—within 30 days—the families it split up at the southern border. Fortune
Trump appears to have taken note of the severe industrial pushback against his reported plans to limit Chinese investment in U.S. technology—a move that his advisors said was essential to stop China from stealing American intellectual property. Trump is now saying that such theft is best combatted through the existing tools offered by the Committee on Foreign Investment—though he also maintains that the original reports of his plan for new tools were "a bad leak…probably just made up." Wall Street Journal
Uber is now operating legally in London again, after a court said the company was "fit and proper" to receive a licence—however, it's only a temporary 15-month licence, rather than the five-year authorization Uber was after. So the firm is essentially on probation now, and it has to demonstrate that it plays by the rules these days under the reign of CEO Dara Khosrowshahi, more than it used to in the era of Travis Kalanick. BBC
Facebook is shuttering its plane-building plant in the U.K. The company was working on its own aircraft to build out airborne Internet connectivity in hard-to-reach places around the world, but now it's noted that actual aerospace companies are investing in high-altitude aircraft of this sort. "Given these developments, we've decided not to design or build our own aircraft any longer, and to close our facility in Bridgwater," the firm said in a blog post, adding that it would work with partners like Airbus in the future. Facebook
Around the Water Cooler
Facebook and Cryptocurrencies
Speaking of Facebook, the company has also partially rolled back its ban on cryptocurrency-related ads, which it introduced back in January. Ads from vetted advertisers will now be allowed in the realms of cryptocurrencies themselves and "related content," but ads for initial coin offerings and binary options—both areas that are rife with scams—are still off the table. Fortune
There's a shortage of food-grade carbon dioxide in Europe, leading to fears that the beer industry, along with purveyors of other fizzy drinks, might run out of gas. The timing is not great, with the soccer World Cup on. The shortage is due to maintenance shutdowns at major ammonia plants in Northern Europe, as well as temporary closures at bio-ethanol plants across the EU. Booker, a major wholesaler of beers and ciders for the hospitality industry, has started rationing its wares. CNBC
More prominent European hedge fund managers are starting to predict a looming market crash. Kirkoswald's Greg Coffey warns that "the ghosts of 2000 are upon us," while Horseman's Russell Clark is invoking 2008. Others are feeling more upbeat, though. Bloomberg
Want a collection of eight business books to take on your summer vacations? Fortune has you covered, with a list of page-turners that aren't just informative; they're good fun, too. Examples include John Carreyrou's Theranos exposé, Bad Blood, Emily Chang's dive into the "bro culture" of Silicon Valley, Brotopia, and Nick Bilton's chronicle of Twitter's roots, Hatching Twitter. Fortune