Two iconic CEOs step down
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Two iconic CEOs stepped down yesterday. Disney’s Bob Iger left the job he has held for 14 years. And Mastercard‘s Ajay Banga, who has held the job for a decade, said he will step down at the end of the year. Iger will remain chairman until the end of 2021; Banga will become executive chairman at the beginning of 2021.
Iger capped his career with the successful $71 billion purchase of 21st Century Fox in 2018—creating the world’s largest and most powerful entertainment empire.
But Banga looms large in my book for his passionate advocacy of financial inclusion around the world. The company now has some 1,500 financial inclusion projects in 80 countries touching 500 million people. In a piece written for Fortune last year, he explained: “This isn’t just an issue of philanthropy or corporate social responsibility…This is about businesses achieving commercially sustainable social impact, aligning their business models and products and services with broader social and economic imperatives. This is not at odds with delivering shareholder returns, but the means by which to do so.” During his decade in office, Banga increased the MasterCard stock price 16x.
In an interview yesterday, Banga told me he first got hooked on the financial inclusion imperative in 2013, on a trip with the man who is now replacing him as CEO—Michael Miebach. Miebach was then running the Middle East and Africa for the company, and they visited a woman named Heidi who lived in a small hut in South Africa and had no way of receiving her government pension except in cash. Miebach and Mastercard helped solve that problem.
“This whole idea that there are all these people being left behind and we can help them…that matters to me.” He is glad to see more companies joining the bandwagon. (Banga was one of 50 CEOs who joined Fortune’s dinner on this topic at the World Economic Forum in Davos.) His advice to them all: “Don’t do it as philanthropy, writing a check.” For Mastercard, the need to be inclusive is a business imperative. “If you don’t give people an account or an identity, they have no future. This to me is a mission critical angle.”
By the way, Banga, as mentioned, will stay on as executive chairman. That’s not an arrangement that always works well, as Fortune’s Geoff Colvin explored recently here. But Banga says he and Miebach will make it work. “We are friends and colleagues. When we disagree, we may shout at each other. But there are very few people I’d rather hang out with than him.” Watch those words.
More news below. And you may want to check out this analysis of America’s most overpaid CEOs, measured as a multiple of their company’s median pay. Top of the list? Oracle co-CEOs Safra Catz and the late Mark Hurd; Align Technology’s Joseph Hogan; and the departing Mr. Iger.
It's quite the week for CEOs stepping down. Salesforce appears to have ended its year-and-a-half-long experiment with having two people share the top job—co-CEO Keith Block is heading for the door, leaving Marc Benioff in charge (Block will continue to advise him). Salesforce also named former BT Group CEO Gavin Patterson as its new head of international. Fortune
After the U.S. CDC forecast the coronavirus's spread in the U.S., the Covid-19 gloom continued today in Asia, with the Nikkei dropping 0.8%, the Hang Seng 0.7%, the Shanghai Composite 0.8%, and the Kospi 1.3%. The slump exacerbated in Europe, where cases are being reported in more countries. The Stoxx Europe 600 was down over 2% at one point, while in the U.S.—where yesterday was another bloodbath—futures suggest a flat opening. Washington Post
Amazon has had to warn some of its sellers not to price-gouge customers of their face masks. While medical experts say diligent hand-washing is what people should be doing to ward off coronavirus infection, many are flocking to buy face masks that have almost quadrupled in price over the last few weeks. Wired
Mini trade deal
Phil Hogan, the EU's chief trade negotiator, reckons it will be possible to strike a "mini deal" with the U.S. that avoids an all-out trade war. Hogan said the U.S. suspension of tariffs on Airbus products "will give us that chance hopefully to make some sort of an agreement…We're in a better place than we were some weeks ago." Financial Times
AROUND THE WATER COOLER
Everyone vs. Bernie
Bernie Sanders, now the clear frontrunner in the race to be the Democrats' presidential nominee, took flak from all six of his rivals at last night's debate. Michael Bloomberg claimed the Russians like him because they want President Trump reelected; Elizabeth Warren said he nicked details of her health care plan; and Pete Buttigieg said a Sanders nomination would lose Congress to the Republicans. Bloomberg
Hot Pockets heiress Michelle Janavs has been put behind bars for five months over her corruption of the college admissions system. Janavs, the latest person to go down over the admission scandal, agreed to pay $300,000 to illegally give her daughters an edge through test-fixing and false identification as a sports recruit. Wall Street Journal
Blackstone is picking up the British student accommodation company iQ for just over $6 billion, marking the U.K.'s biggest-ever real-estate deal. The sellers are Goldman Sachs's merchant banking unit and the medical charity Wellcome Trust. Reuters
Fortune's Katherine Dunn has a great interview with Paris Agreement architects Christiana Figueres and Tom Rivett-Carnac, who have a new book out on surviving the climate crisis. Rivett Carnac: "I’ve walked into many companies where they are exemplary on their climate action, and they say some version of, we’re doing everything we can, and policy needs to go further and faster. And then I’ve said to them some version of, well, did you know that you are actually a member of several trade associations who are still lobbying against more aggressive policy?" Fortune
This edition of CEO Daily was edited by David Meyer.