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More CEOs risk speaking out on social issues. Today under relentless pressure, Trump finally condemns thuggish groups by name

It has come to this:

“Exec resigns from president’s council, and Trump lashes out”


 “Trump names hate groups, denouncing Charlottesville violence”

In the wake of the racially-tinged Charlottesville Va. riot — and the president’s reluctance to call out white-supremacists’ role in it — Merck CEO Kenneth Frazier resigned from a Trump manufacturing council.

The president was quick to lash out in a Monday early-morning tweet by stretching for a response. He chose drug prices. But under mounting pressure, later in the day he described members of the KKK, neo-Nazis and white supremacists as “criminals and thugs.”

Mr. Frazier had cited “a responsibility to take a stand against intolerance and extremism”. He extended that sentiment to country leaders — including, by inference, business leaders — who must “honor fundamental values of clearly rejecting expressions of hatred, bigotry and group supremacy.”

The Associated Press report provided this context on business leaders recently taking such positions:

“Frazier is not the first executive to resign from advisory councils serving Trump. Tesla CEO Elon Musk resigned from the manufacturing council in June, and two other advisory groups to the president after the U.S. withdrawal  from the Paris climate agreement. Walt Disney Co. Chairman and CEO Bob Iger resigned from a White House advisory council for the same reason.”

[As we post Monday afternoon, potential fallout is fluid. Frazier will undoubtedly get reactions from stakeholders. And legacy and alt-right media will undoubtedly keep the issue alive] 

These and other business leaders have weighed the potential risks not only of Trump ire, but the possibility of loss of some support from members of stakeholder groups. As with the many other decisions company managements must make, they have not only made these corporate reputational choices on social issues but have also gone public about those choices.

Coincidentally but significantly, Procter & Gamble is about to launch a major advertising campaign, “Proctor & Gamble takes calculated risk with “The Talk ad”. Benjamin Bates, a professor of health communications at Ohio University’s Scripps College of Communication, referring to the P & G campaign, offered an analysis that could also apply to the CEOs taking a public stand on

Charlottesville/Trump. Bates said that he believed the reward outweighed the risk since the ads appealed to African-Americans and younger consumers more comfortable with diversity. The business case, he suggested, is clear:

“The people the ad would alienate are a small percentage. I, as a CEO, would probably think, “if I lose some racists because of this, I’m OK with that.”