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In my January 1 newsletter (see here), I argued that the current ethics megatrend with the greatest impact on our national moral character is whether our leaders demonstrate courage or capitulation in the face of the Trump administration’s increasingly dictatorial and anti-democratic behavior. While my focus was primarily on politicians, particularly members of the president’s own party, dramas are also playing out daily in business. In the past month, the spotlight shifted to highlight these choices made by corporate leaders. In discussing the ethics of social media and AI in my last newsletter, I noted that Anthropic’s CEO Dario Amodei resisted Defense Department demands that the company’s AI model, Claude, be authorized to conduct mass surveillance of Americans and enable autonomous weapons to kill without a human making the final decision. Anthropic’s competitors agreed to this request, obviously hoping to take over Anthropic’s defense business. Defense Secretary Pete Hegseth declared Anthropic a national security “supply chain risk,” which renders the company ineligible for additional defense contracts and may prohibit any other defense contractor from doing business with Anthropic. Amodei commented in a candid email to his staff that the company was being targeted for not having donated to Trump’s causes and for not offering “dictator-style praise” to Trump. Next, Trump put his thumb heavily on the scale in the competition between Netflix and David Ellison to acquire Warner Brothers Discovery, including its network CNN. Ellison leaned on his family’s close ties to Trump, promising to bring significant changes to CNN, which Trump had criticized. Trump then threatened Netflix with antitrust action to prevent their ability to close the deal. Dispelling any question about the administration’s favoritism, Hegseth declared this week that he could hardly wait for the Ellisons to take over CNN, thereby making it more friendly to the administration. Perhaps the most egregious example of corporate capitulation and pandering to Trump was in the news again this week. Gianni Infantino, the president of the global soccer organization FIFA, was embarrassed by Trump pressuring Iran’s soccer team not to participate in the World Cup this summer, which will be held in the U.S., Canada, and Mexico. Infantino’s pandering to Trump over the past six months, exemplified by his effusive introduction of Trump at Davos and his creating a “FIFA Peace Prize” to please Trump when he did not win the Nobel Peace Prize, has become the most obvious example of obsequious business behavior. Yes, global soccer and other sports are businesses! There has been much debate over how companies (as well as universities and law firms) ought to respond to the bullying and authoritarian behavior of the Trump administration. I have even suggested that “laying low” may be an acceptable strategy in this tumultuous time. Significantly, this strategy is now being challenged by many, including 23 retired professors from that radical institution: the Harvard Business School. Last week, they wrote in an op-ed published by the Harvard Crimson newspaper that we are in a moment when “laying low” is no longer acceptable. Their concern is that the SAVE Act and other measures to suppress the right to vote by the Trump administration are unique threats to American democracy (see here). They urge today’s corporate leaders, some of whom they have taught, to “speak out now, act now, in defense of democracy.” They quote Franklin Delano Roosevelt in his first inaugural address, who said, “This is preeminently the time to speak the truth, the whole truth, frankly and boldly.” The debate over whether corporate executives should speak out on social and political issues was raised before 2020, and a few corporate executives spoke out forcefully on selected issues. In the 1990s, Robert Haas, CEO of Levi Strauss, was a public advocate for the rights of LGBTQ+ individuals, a cause supported in the 2010s by Apple CEO Tim Cook after he succeeded Steve Jobs as CEO. Salesforce CEO Marc Benioff spoke out against discriminatory laws and for practical solutions to homelessness. Starbucks CEO Howard Schultz was an early public advocate for common-sense solutions to immigration policy. Nike backed its athlete Colin Kaepernick as he protested racial injustice in America. Pressed by their younger employees—and worried they would lose customer credibility—many corporations and their leaders spoke out when the 2020 murder of George Floyd drew national attention to the persistence of discrimination in America. In 2022, Disney’s leader, Robert Chapek, protested Florida Governor Ron DeSantis’ proposed legislation banning any discussion of LGBTQ+ issues in schools. Over the last decade, a few corporate leaders have spoken out against administration policies that have gutted environmental and diversity commitments, and a few have defended the independence of Jerome Powell as Chair of the Federal Reserve, but too many have cowered in fear that raising their voices would invite retaliation against them personally or against their companies. More have been willing to stay quiet and even pay tribute to Trump in the form of praise, generous legal settlements, or huge contributions to Trump’s presidential library or White House ballroom. Advocates of corporate speech argue that companies have significant social power and their silence signals acceptance of unjust situations. Others argue that employees, particularly Gen Z employees, and consumers expect companies to speak out. Opponents argue that statements by corporate leaders can alienate some customers and may therefore violate the executives’ obligations to shareholders. They also argue that an executive may advocate for a position not favored by either employees or shareholders. The Harvard Business School professors’ statement argues we are in a unique moment in American history, a moment in which the president is seeking to undermine a fundamental principle of democracy and American identity. Silence, they argue, is complicity and capitulation. Only public voice and protest can put corporate leaders as individuals and their companies on the right side of ethics and American history. Will they respond?
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