Apple Announcements, Obamacare Gamble, Brexit Votes: CEO Daily for March 26, 2019
Levi Strauss & Co. had a successful IPO last week, and it deserves attention for a couple of reasons.
First, most of the IPOs being talked about this year are for companies barely 10 years old—think Lyft, Uber, Airbnb, Slack. Levi Strauss, on the other hand, has been around since 1873—a product of the California gold rush.
Second, while we write a lot about the growing group of companies eager to put public purpose at the center of their business strategies, Levi Strauss has been doing that from day one—when the owner made a substantial donation to charity out of his first year of profits. The company desegregated factories in the South ten years before Jim Crow laws were knocked down, went to heroic efforts to avoid layoffs during the Great Depression, became one of the first companies to give health benefits to same-sex partners, and pulled all funding from the Boy Scouts when it banned gay individuals. Those were tough decisions for a hard-core blue jeans company—the last one prompted 130,000 angry letters opposing the company’s action. But it put Levi Strauss on the right side of history.
Current CEO Chip Bergh, who joined the company seven years ago, was attracted by that history and has continued the theme. He came to Fortune’s Brainstorm Green conference in 2014 to talk about his commitment to sustainable apparel (and earned some notoriety for telling attendees to “stop washing their jeans.”). He created a precedent-shattering wellness program for his company’s employees. And last fall, he announced a campaign against gun violence, calling on other CEOs to join in.
So will that be harder to do now that it’s a public company, with demanding shareholders? Bergh thinks not. “We talked about this on the road show,” he said. “Part of the reason we’ve been around for 166 years is our commitment to running the business for long term.”
It helps that Bergh is delivering results: he’s made double digit revenue growth a standard for the last couple of years. It also helps that his company has a dual class share structure—descendants of the founding family have shares with 10 times the voting rights of ordinary shares, and they are “the ultimate long-term investors,” he says.
Still, Bergh believes this is a path others can follow. There is a growing “hunger for companies that are committed to a moral compass, that are committed to doing the right thing.” We think—and hope—he’s right.
More news below.
Apple showed off a bunch of new services yesterday: a news subscription service called News+; a game subscription service called Apple Arcade; a per-channel subscription service for Apple TV; an Apple TV+ service that will boast original programming; and a virtual credit card, called Apple Card, that's backed by Goldman Sachs and Mastercard. The Verge
The Justice Department is stepping up its attack on the Affordable Care Act by arguing that all of it is unconstitutional—last year it only said parts of the law should be struck down. It's a risky move from the Trump administration, and certainly one that the Democrats have pounced upon. House Speaker Nancy Pelosi: "Tonight in federal court, the Trump administration decided not only to try to destroy protections for Americans living with pre-existing conditions, but to declare all-out war on the health care of the American people." Bloomberg
The U.K. Parliament, which has shown what it doesn't want from Brexit, will tomorrow get a chance to say what it does want via a series of so-called indicative votes that Parliament itself is organizing. The timetable is usually up to the government, but Parliament doesn't trust the government to put all the options on the table, and it seized control of the affair in a vote last night. BBC
Norway's Equinor, the oil-and-gas giant formerly known as Statoil, is investing in a $180 million fund aimed at storage technologies for renewable energy. The Volta Energy Technologies fund is based in Chicago and has already made four investments. Equinor's move is notable given the Norwegian economy's traditional reliance on fossil fuels. Fortune
Around the Water Cooler
Michael Avenatti, the celebrity lawyer who became famous representing Stormy Daniels, has been arrested for allegedly trying to extort $20 million from Nike—he apparently threatened to publicize claims about Nike paying the families of high school basketball players—and for allegedly embezzling a client's money and defrauding a Mississippi bank. CNBC
Australia's far-right One Nation party has been stung hard by an undercover Al Jazeera investigation in which its representatives were filmed meeting with NRA representatives in Washington. One Nation wants to loosen Australia's gun laws and the NRA was happy to advise, recommending the following in cases of mass shootings: "Just shame them to the whole idea… How dare you stand on the graves of those children to put forward your political agenda?" One Nation rep's response: "I love that, thank you." Al Jazeera
The computer maker Asus fell victim to a horrendous hack in which someone commandeered Asus's software update platform to put insecurities into around half a million PCs. It seems the attackers were trying to target around 600 computers in particular, with the snuck-in "back door" opening the way for deeper takeovers of the machines. Motherboard
Katie Couric writes for Fortune about how easy it is to reinforce stereotypes that "can prevent a girl from becoming the next Ginni Rometty" by reducing her scientific confidence. "It is well past time that we overcome the implicit and explicit biases that have contributed to these sobering, infuriating statistics," she writes. "We can no longer allow women’s incredible and transformative achievements to be rendered invisible." Fortune