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Good morning.
Bank of America CEO Brian Moynihan is our guest this week on Leadership Next, Fortune’s podcast about the changing rules of business leadership. I invited Moynihan to do the podcast back in February, after running into him at the World Economic Forum in Davos, where he was chairing a group working on metrics for measuring companies’ commitments to social goals. That the CEO of one of the world’s largest banks thought this was a good use of his time struck me as notable.
Why was he doing it? “Because it’s the right thing to do,” Moynihan said. That’s a standard he’s come back to repeatedly at Bank of America, where he’s raised the minimum wage to $20 an hour, committed hundreds of millions of dollars to the environment, announced a billion dollar commitment to communities of color, and taken strong stands on controversial issues like guns and transgender rights.
A striking example came in 2015, when the state legislature of North Carolina, where Bank of America is based, passed a law limiting transgender access to public bathrooms. That’s the sort of controversial social issue most business leaders would have run from in the past. But Moynihan took a public stand against the law. “We believe in diversity and inclusion in our company. We believe it’s the way to get the best people to be their best selves at work,” he said. “We happened to have our global diversity and inclusion awards ceremony in Charlotte that year, and people said they wouldn’t come. When something affects your teammates, you have to go in a make sure they are comfortable.”
Worth noting that Moynihan took over as CEO in 2010, when Bank of America’s finances and reputation had been badly battered by the financial crisis. He orchestrated an amazing turnaround, documented by Fortune’s Shawn Tully here, even as he worked to boost the bank’s benefits to society. Moynihan says the pandemic has only increased corporate interest in his effort to develop metrics for stakeholder capitalism. The recession has obviously had a more complicated effect on the bank’s finances. Tully masterfully dissects the bank’s latest earnings report here.
More news below.
Alan Murray
@alansmurray
alan.murray@fortune.com
TOP NEWS
TSMC surge
Intel's decline has been good for rival Taiwan Semiconductor Manufacturing Corp, whose stock surged 9.5% on news of Intel manufacturing delays. The jump made TSMC one of the world's ten most valuable companies, with Johnson & Johnson being booted out of that top tier as a result. Fortune
1MDB verdict
Former Malaysian Prime Minister Najib Razak has been found guilty of corruption for his role in the theft of billions of dollars from the 1MDB sovereign wealth fund. Najib, the first Malaysian premier to be convicted of graft, now faces decades behind bars, along with fines–if it weren't for the fact that he is 67-years-old, he would be whipped, too. Further cases related to the scandal still loom, but Goldman Sachs last week reached a $3.9 billion settlement with the government over its role. Al Jazeera
Tencent and Sogou
Tencent has offered to buy out the U.S.-listed Chinese search engine and A.I. player Sogou for $2.1 billion. The move, if it goes ahead, would likely be a precursor to a listing in Hong Kong or Shanghai. Chinese tech firms are increasingly looking to delist from the U.S. due to a proposed bill there that would impose stricter disclosure requirements. Fortune
Garmin ransom
The smartwatch maker Garmin has reportedly obtained the decryption key needed to recover files from a ransomware attack last week, and expects its systems to return to normal operation in the coming days. If Garmin paid the ransom to the attackers, suspected to be Russia's Evil Corp group, then the American firm could fall foul of the fact that the U.S. has sanctioned Evil Corp, forbidding transactions between it and "U.S. persons." Sky News's sources say there was no direct payment to the hackers. Sky News
AROUND THE WATER COOLER
Wirecard fines
Visa and Mastercard heavily fined the now-collapsed Wirecard more than a decade ago because the German payments processor miscoded gambling transactions and had high levels of stolen card purchases and reversed transactions. The card networks also asked Wirecard to ditch some dodgy merchants it was servicing, though its high-risk clients–in areas such as pornography and unregulated "neutraceuticals"–were highly lucrative for the firm. Wall Street Journal
Junk food
The U.K.'s splashy ban on junk-food advertising before 9 p.m., announced yesterday as part of a strategy to help people lose weight and become less susceptible to nasty bouts of COVID-19, already looks set to be watered down following industry anger. The government now says the measure could take as much as two years to introduce in order to give food producers time to make their products healthier. Times
Online tax
Another new idea from the British government is facing pushback from the business sector. This time, it's an online sales tax aimed at protecting retail-sector jobs and combating store closures. The British Retail Consortium says such a move would raise prices for consumers. BRC regulatory chief Tom Ironside: "Throughout the pandemic, many of us have been relying on retailers to ramp up their online services to ensure we can all get the goods we need. The government should not harm these efforts by further taxing the businesses providing these services, and the people they serve." BBC
Bitcoin boost
Bitcoin is surging again–it touched the $11,000 mark again yesterday–and there doesn't seem to be one clear cause. Fortune's Jeff John Roberts runs through the possible factors, which include: traders reaping gains from obscure digital currencies and putting them into the well-known Bitcoin and Ethereum assets; regulators allowing banks to hold Bitcoin on behalf of customers; and general fear and uncertainty. Fortune
This edition of CEO Daily was edited by David Meyer.
