Traditionally, CEOs (especially startup CEOs) have tried to avoid mixing business and politics, perhaps because of the fear that the latter would harm the former.
Back in the 1990s, basketball star Michael Jordan refused to endorse a Democratic candidate for governor of his home state of North Carolina, saying, “Republicans buy shoes too.”
But in 2020, this traditional approach seems both outdated and untenable. The most important issues that affect every business – the Covid-19 pandemic, widespread protests against racism, and the presidential election – are, or have become, undeniably political.
As a sign of the times, earlier this year, Michael Jordan, his Jordan brand, and his partner Nike released a statement supporting the Black Lives Matter movement and committing to donate $100 million to organizations dedicated to ensuring racial equality, social justice and greater access to education.
Business leaders today must navigate an increasingly politicized world. While making statements has become more common, it’s still a complex undertaking that should be approached with care.
We need to define a set of principles that can help decide when, how, and why CEOs should speak out. I had a conversation with my Blitzscaling co-author Chris Yeh about this topic. You can listen below:
Principle #1: Businesses and Their Leaders Have Ethical Responsibilities
This first principle should be obvious, but sadly it is not. The common phrase, “It’s not personal, it’s strictly business,” is often used to imply a distinction between what is ethical in business and what is ethical in the rest of our lives.
But this quote comes from the movie, “The Godfather,” and it helps illustrate protagonist Michael Corleone’s transformation from war hero into sociopathic mafia leader. It is a terrible role model for leaders.
When it comes to business, you should always be human, ethical, and compassionate first; business should operate within, rather than outside, these principles.
In Blitzscaling, we wrote about the responsibility that businesses bear to protect and improve the society that makes them possible:
“We believe that the responsibilities of a blitzscaler go beyond simply maximizing shareholder value while obeying the law; you are also responsible for how the actions of your business impact the larger society.
But even beyond the moral imperatives, responsible blitzscaling is good business strategy. Society provides the ecosystem in which you live, and in which your business operates, which means that it can rightly claim some responsibility for your success. In other words, your success is contingent upon society functioning properly.”
The same moral and practical imperatives apply to any business and its leaders.
But it is not enough to simply avoid the unethical. The key question is, when does inaction itself become immoral?
EVALUATING IMPACT WITH THE THREE ‘S’s’: SEVERITY, SCOPE AND SYSTEMIC
Again, the responsible blitzscaling framework offers some valuable insights. We argue that the key criteria for evaluating risks to society are the three “S”es: The severity, scope, and systemic nature of potential negative consequences.
- The greater the severity (ranging from trivial to life-threatening),
- scope (ranging from one person to millions of people),
- and systemic fallout (ranging from completely isolated to triggering a cascade of additional issues), the greater the imperative to act.
Another factor is the uncertainty of outcome, both in terms of probability and confidence. The greater the uncertainty, the greater the obligation to act. It’s immoral to simply throw up one’s hands and say, “What do you have to lose?”
CASE STUDY: THE 2016 PRESIDENTIAL ELECTION
In my case, this set of principles led me to take a stand and speak out against the presidential candidacy of Donald Trump in 2016.
While I had grown up politically active (my parents demonstrated against the Vietnam War when I was a child) and I believed strongly in the importance of being a good citizen of the United States, I had internalized the traditional separation of business and politics: Don’t make any particular group feel uncomfortable. Don’t bring politics into the workplace. Be as inclusive as possible.
At my first post-university job at Apple, even though I would discuss politics and share my anti-war and progressive opinions with my co-workers, I was careful to limit those discussions to lunches outside the office, and built friendships with people across the political spectrum.
But when Donald Trump ran for president in 2016, I decided that I had a moral obligation to speak out, even when that made others uncomfortable. Trump was not just someone with different political beliefs; he was actually attacking core democratic principles like speaking the truth and respecting the rule of law.
As President, Donald Trump would be making life-and-death decisions that could affect all Americans, and might actually harm the institutions of democracy itself. Therefore, he represented a risk with high severity, broad scope, and systemic impact.
I drew criticism from a number of my friends and my colleagues at LinkedIn, who said that they were uncomfortable that I was speaking out against a political candidate in unequivocal terms without any effort to soften my statements. But I didn’t think I was having a Democrat versus Republican argument; I felt that Trump winning would represent a collapse of American values.
My stance was sadly prescient; during the Trump presidency, over 160,000 Americans have lost their lives to Covid-19, over 30 million have lost their jobs, and Trump’s re-election campaign continues to harm the underpinnings of society with actions like baseless attacks on the legitimacy of mail-in voting.
Principle #2: Leadership Is Ethical, Cultural, And Visionary
While speaking out about political issues can be uncomfortable for business leaders and their teams, it is a core part of leadership.
Leadership isn’t just about authority that flows from a corporate hierarchy. After all, all of your employees are voluntary.
The way to attract and retain good people is to provide ethical, cultural, and visionary leadership.
Talking politics is a way of demonstrating these forms of leadership:
- You can’t demonstrate ethical leadership if you don’t speak out about political issues that violate your ethics or corporate values.
- You can’t demonstrate cultural leadership if you don’t take political stances to defend the culture that you’ve tried to build within your company.
- You can’t demonstrate visionary leadership if you stand idly by while politicians and special interest groups try to halt or dismantle the better world you’ve envisioned.
In 2016, North Carolina passed HB2, the so-called “bathroom bill” which compelled schools and public facilities to restrict single-gender bathroom use based on the gender listed on an individual’s birth certificate. In response, companies like PayPal cancelled plans to establish or expand offices in North Carolina, and Salesforce.com’s Mark Benioff criticized the law, even though Salesforce did not have operations in North Carolina at the time.
You might think that it would be wiser for CEOs to simply remain silent on a political matter, but doing so would violate corporate values of inclusiveness, cultural practices around diversity, and a vision of a world in which people could not be discriminated against for being different.
And if you do speak up, employees (and potential employees) will respond positively. By being explicit about what you believe in, you make it easier for everyone around you to understand whether or not they’re aligned with those beliefs.
There might be some people whose beliefs are not aligned with yours, and you might lose some of their support, but that downside is likely far outweighed by the fact that people whose beliefs really align with yours, are more likely to be attracted to your company and what you’re trying to accomplish in the world.
Yes, you could go through this world saying as little as possible and leaving everyone in doubt as to what your beliefs are, but that’s not the way that a company attracts the best people.
You get the best people because they want to be part of a mission that really fits their personal values.
Principle #3: Your Ethical Stance Isn’t Real Unless It Hurts and Makes a Difference
After the police killing of George Floyd, many companies and their social media teams responded and joined in Blackout Tuesday. They tweeted or Instagrammed either a blank black square or a message of support.
The problem is, that kind of easy, surface-level action simply isn’t significant enough to mark a business as authentically committed to change.
When you decide to take a political stand, you should be serious enough about it that you’re willing to put real energy, sweat, and blood behind it. The way I apply this principle to my own activities is to ask, Do I feel the cost of the time and dollars that I’m investing in this action? If not, I’m not really investing.
If something is truly important, it’s important enough to make sacrifices for it. You should think afterwards, There were things I really wanted to do with that money, or There were other things I really wanted to do, that I’ve had to defer or cancel.
You also need to focus on having a real impact, not just on symbolic value. A pointless sacrifice is, first and foremost, pointless. Classic best practices like establishing OKRs and focusing on the highest-returning programs apply.
So if you decide that you should support racial equality, it’s not enough to post a black square on Instagram.
You should commit to funding specific programs to recruit more diverse employees, and to building a dashboard which makes the company’s diversity progress apparent to all employees, with regular evaluations to see if that progress is occurring quickly enough. For example, at Greylock, we have made a firm-wide commitment to a set of programs where the partners invest their time as well as their money.
Principle #4: People Can Disagree on Political Positions, as Long as They Can Engage in Respectful Dialogue
One of the challenges that a business leader in this environment faces is that not everyone in the organization holds the same political positions. To address this, leaders need to create the cultural norm that compassionate, smart, ethical people can disagree with each other.
On a personal level, one key technique is to acknowledge the possibility that you might be wrong.
Before I started speaking out against Donald Trump’s candidacy in 2016, I spoke with my Republican friends — including Peter Thiel (who actually spoke at the Republican National Convention that year). I said, “Criticize my position, and give me your best arguments against it.” I did so to gather an informed theory, to try to find the truth.
Until you can successfully articulate the opposing point of view, you don’t know it well enough to be able to say that it is wrong, and provide the necessary evidence to support your own point of view.
This same principle applies to the increasingly prominent phenomenon of employee activism. Business leaders should engage with employee criticism and calls for change in the same way that they engage with anyone with different points of view: with an open mind and the goal of seeking the truth. By taking an engaged, truth-seeking approach, even those that continue to disagree will likely think well of the company’s willingness to talk.
Conversely, when a business leader makes the decision to speak out on political issues, it’s their ethical responsibility to engage with other stakeholders before speaking out. The process should be transparent and inclusive, even if the CEO will necessarily make the final decisions.
In his Masters of Scale interview, Uber CEO Dara Khosrowshahi talked about how he created an open and transparent process to allow Uber employees to participate in defining the very necessary changes to Uber’s core values. The same kind of care should apply to political activism; while the act is a personal one for the CEO, it is also an organizational one.
In an increasingly politicized world, it’s harder and harder for CEOs to keep business and politics separate. And in an increasingly politicized world, they shouldn’t.
When an issue creates risks that are severe, broad in scope, and systemic in impact, business leaders have an obligation to speak up, especially if the issue clashes with the company’s ethics, culture, and vision for the future.
It’s not enough to make symbolic but largely low-impact gestures; the actions you take should require sacrifice and have a significant impact. The best way to align the entire organization, including activist employees, around these actions is to follow an inclusive, transparent process that focuses on shared principles, even when disagreements still exist about specific positions.
By following this framework, business leaders can minimize the risks and maximize the positive impact of talking politics.