Here’s what CEOs see coming after the pandemic
This is the web version of CEO Daily. To get it delivered to your inbox, sign up here.
What will the world look like once the pandemic has passed? It’s not easy to view the path of a hurricane from its center, but business leaders are having to make bets based on their best guesses of the future. In our annual survey, we asked the CEOs of the Fortune 500 whether they agreed or disagreed with some of the predictions being floated these days about how things will permanently change. Here are the ones a majority of CEOs agreed with:
“Business travel will become less frequent, replaced by video conferencing.” – 91% agreed.
“Nationalism will rise, and global supply chains will become less common.” – 82% agreed.
“Government surveillance techniques will become more common worldwide.” – 81% agreed.
A majority disagreed with this one:
“Trust in government will rise, as a result to their response to the crisis.” – 55% disagreed.
And the CEOS split near the middle on these three:
“China will be strengthened as a power in the world” – 42% agreed, 38% disagreed.
“Trust in capitalism will rise, as a result of the business response to the crisis.” – 28% agreed, 24% disagreed.
“Concern about the environment will fall, as a result of more immediate focus on economic problems.” – 42% agreed, 35% disagreed.
Separately, Land O’Lakes CEO Beth Ford spoke virtually with the Fortune Most Powerful Women community yesterday about the disruption the pandemic is causing to the food system. “Production is not the issue,” she said. “We have plenty of food. Part of the problem is we have too much milk, too many cattle, too many hogs. What we have is a distribution problem.”
The challenge, she said, is that “over time, these supply chains were made hyper efficient. Everything was ‘just-in-time.’“ When restaurants shut down and home demand soared, “there was just not a lot of room to change… It’s not easy to change your platform because the margins are so narrow.”
Fed Chair Jerome Powell and Treasury Secretary Steve Mnuchin do not see eye to eye on the issue of federal coronavirus aid. As expressed yesterday, the former thinks more federal aid is needed, while the latter would prefer to wait and see, as—like President Trump—he thinks a V-shaped recovery is imminent. Powell: "The scope and speed of this downturn are without modern precedent and are significantly worse than any recession since World War II." Wall Street Journal
Rolls-Royce is cutting 9,000 jobs as it now expects the airline industry's recovery from the coronavirus pandemic will take years. "This is not a crisis of our making. But it is the crisis that we face and must deal with," said the engine-maker's CEO, Warren East. The cuts will mainly affect the British firm's civil aerospace division, two thirds of which operates out of the U.K. BBC
Following an accounting scandal that saw its CEO and COO defenestrated, Luckin Coffee has now been delisted from the Nasdaq stock exchange (or at least it will be if its appeal fails). As Fortune's Eamon Barrett writes: "The brouhaha over Luckin’s fraud… could become the impetus Washington needs to act on its long-time threat to impose tougher regulations against Chinese stocks." Fortune
U.S. and Russia
The U.S. will send Russia 200 ventilators to help it cope with the pandemic—Russia has nearly 300,000 confirmed cases, making it second only to the U.S. (which has five times as many). The State Department said President Putin called President Trump to ask for help, and the U.S. seeks a better relationship with Russia on many fronts." The donation will begin today with a shipment of 50 U.S.-produced ventilators. CNBC
AROUND THE WATER COOLER
In the U.S., the pandemic arose in a context of extreme political polarization, so conservative and liberal media outlets talk about it in very different ways. However, according to language-assessing A.I. startup Pluralytics, there is common-ground language to be found: words like "stimulus," "jobs" and "schools" resonate on both sides of the divide. Fortune
Denmark, Finland and Norway are looking to ease entry restrictions for people from other countries—but maybe not Sweden. Sweden, which avoided the full-lockdown route adopted by most other European countries, now has the highest COVID-19 mortality rate per capita. Financial Times
Chinese doctors are seeing what may be evidence of the novel coronavirus mutating in unknown ways. It seems patients in northern Chinese provinces are carrying the virus for longer, taking longer to show symptoms, and taking longer to recover, than what was observed during the original Wuhan outbreak. Significant mutation of the virus could hamper efforts to combat it; on the other hand, the apparent differences could be a result of doctors' ability to monitor patients more thoroughly and from an earlier stage now. Bloomberg
At least two-thirds of the Fortune 1000 is now using a customer-sentiment metric—though some now call it a "religion"—known as the Net Promoter Score. As Geoff Colvin writes: "If you are somehow unfamiliar with the Net Promoter Score, you have nonetheless been touched by it—guaranteed. That’s because you have received an email or a phone call asking the one simple question at the foundation of the NPS empire: 'On a scale of zero to 10, how likely is it that you would recommend [Company Name] to a friend or colleague?' You were probably asked a second question also: 'Why did you give the answer you gave?' And that, believe it or not, is pretty much it." Fortune
This edition of CEO Daily was edited by David Meyer.