'THE DAILY CORPORATE GOVERNANCE REPORT’ (for public company boards, the C-suite and GCs)

      Please see the items below with the related links (NOTE: access to link content may be metered, require a no-charge registration or require a paid digital subscription)

              (i) the pressure on companies and their CEOs to speak up on the Israel-Hamas war, and the extent to which companies are doing so: The issue of speaking up on the Israeli-Hamas war, both publicly and internally, and the extent to which companies are doing so, are discussed in a number of articles over the past few days, including in this Bloomberg article last Thursday, "Israel-Hamas War Puts Pressure on Companies to Speak Up" (with reference to such companies as Nasdaq, Goldman Sachs. BlackRock , United Airlines Holdings, Nike, Instacart, Bayer, Procter & Gamble, McDonald's and Airbnb); this FT article yesterday, "Business in a bind over messaging on Israel-Hamas war"; this Washington Post article yesterday, Israel-Gaza war prompts U.S. employees to demand companies take a side"; this Fortune commentary last week, "These CEOs are rising to the occasion–and condemning the brutal Hamas attack on Israel. The rest of civil society is MIA" (note that the author of this commentary, Jeffrey Sonnenfeld, who is senior associate dean for leadership studies at the Yale School of Management, has also compiled this list of almost 150 corporations that have spoken out either to condemn Hamas’s attacks and antisemitism or to express solidarity and support for Israel, including such companies as Walmart, Pfizer, JPMorgan, Disney, Salesforce andStarbucks, with links to the public statement made by each of these corporations; and today's NY Times DealBook Newsletter, "Companies Are Caught in the Israel-Hamas War’s Crossfire." Below is from the Bloomberg article:

              "Before Adena Friedman presented Nasdaq Inc.’s financial results on Wednesday’s quarterly earnings call, the stock exchange’s CEO said the company was “horrified by the acts of terrorist violence” in Israel and denounced the “subsequent loss of innocent lives in Israel, Gaza and the wider region.” She echoed similar statements from chief executive officers at Goldman Sachs Group Inc., BlackRock Inc., United Airlines Holdings Inc. and other companies, who are facing increasing pressure to speak up on a conflict where the human cost is rising by the hour.

                   "Crisis communications experts say their phones have been vibrating out of their pockets as CEOs seek help calibrating their messages both inside and outside their companies. With third-quarter earnings season ramping up, many companies won’t have a choice but to face investors, employees and other stakeholders who have come to expect their corporate leaders to weigh in on global events. CEOs are “all asking the same question,” said Davia Temin, founder of New York crisis consultancy Temin and Company. “If you say something, it’s about what you say. But equally you are at risk if you say nothing, because silence is a statement, so silence is controversial, as well.”.......

                    "Major global companies have so far been generally reluctant to wade into the fray, with only about a fifth of the 100 largest companies in the S&P 500 issuing formal statements about the conflict as of Oct. 17. Nearly all of them, by contrast, released public statements on the Russia-Ukraine war. That, in turn, has led to criticism from some employees that their corporate leaders haven’t spoken up quickly enough......

                    "The Israel-Hamas war comes amid debate over companies’ roles in social and diversity initiatives and the expectations of leaders at global companies managing large, diverse workforces. “Once you get into this game, you cannot get out. That’s the expectation now, post-George Floyd,” said Paul Argenti, professor of corporate communications at the Tuck School of Business at Dartmouth. While there was widespread condemnation over the death of George Floyd, companies have begun to scale back public statements on controversial topics to avoid alienating customers and investors. And for good reason — crisis consultants point to the swift outflow of donations in recent days at storied institutions such as Harvard University, highlighting the dangers of wading into geopolitical tensions......."

                    Below is from the FT article: 

                    "After Hamas’s atrocities in Israel and the state’s retaliation in the Gaza Strip, executives at companies including Goldman Sachs and Google emailed staff and made public statements expressing sympathy for victims. Other business leaders chose to say nothing at all. Both responses risked a backlash. 

                    "Some companies have been criticised for “picking a side”; others condemned for their silence. Keniro Miller, a human resources professional at French luxury company Cartier, was among the executives protesting against their companies’ failure to make a comment. “Saying nothing is complicit,” he wrote on LinkedIn. Richemont, Cartier’s parent company......has chosen not to publicly make a statement........

                    "In recent years staff and customers have put pressure on businesses to speak out about political issues — from trans issues and abortion rights to Black Lives Matter — to underline their corporate values. But criticism of corporate responses to the Israel-Hamas conflict shows how fraught with risk reacting to geopolitical crises has become for business executives and their employers. “The last 10 days have been a pendulum swing moment for CEO communication,” said Dominic Reynolds at public relations company Kekst CNC. “Since the pandemic, the direction of travel has been towards CEOs taking positions on social issues that matter to their customers or their people, even if there’s no link to business operations. We’ve observed that trend go into reverse this month. Our clients are anxious to show caution around this conflict, understanding that perceptions can be shifted by superfine nuances of language and tone.” 

                     "This is a big shift from last year, when Russia invaded Ukraine and companies from healthcare group Johnson & Johnson to management consultancy Bain, spoke out. “Clients were asking us what they should say, where and when,” added Reynolds. “This week, they’ve been asking if they should say anything at all.”.......One media company boss said business leaders he had spoken to were tying themselves in knots about how to talk about the Israel-Palestinian conflict, given its decades-long history and complexity. Executives were also asking whether the word “terrorism” should be used in any internal and external communications about the issue. “This is like a geopolitical Roe vs Wade for corporates,” said the executive....... 

                     "Bo Young Lee, who was chief diversity, equity and inclusion officer at Uber during the 2021 war between Israel and Hamas, added that there was “no benefit” for companies to rush out statements. “It takes courage on the part of employers to take a bit of time [and] say we really need to understand the situation.....Many of the companies without regional staff have kept quiet, in line with guidance from corporate advisers. “We advise clients to engage on political and social issues based on the relevance to their organisation and the severity of their impact on the company,” said US corporate adviser Penta Group. Its analysis showed that companies should have a process for deciding what to speak up on. Increasingly boards are getting involved.......

                    "Deciding to act or not can leave a management team open to allegations of bias and discrimination. Companies do not want to be condemned for choosing one side over another.  Google’s chief executive Sundar Pichai followed up his first email to staff expressing sadness for “the terrorist attacks [in Israel]” with another to address the mounting humanitarian crisis and death toll in Gaza.....

                   "Some commentators stressed that companies needed to be consistent — if they have made a statement on Ukraine, they should do so for Israel and Palestine, for example.   Lee disagrees. 'The unfortunate thing about our world now is that something is happening every single day. This idea of consistency is fundamentally flawed . . . a company would be making a statement every single day. Make a statement when it impacts your business, you have something to say about it and you can have a meaningful impact.'........."

             (ii)  Johnson & Johnson CEO on the 'purpose-driven' corporation, and the Johnson and Johnson (80-year-old) credo: Johnson & Johnson CEO Joaquin Duato was recently interviewed by Fortune editor-in-chief Alyson Shontell in the latest episode of Fortune's "Leadership Next" series of podcasts. Below is an excerpt from the transcript. Note that this is the 80-year -old Johnson & Johnson credo referred to in he interview:

                    "Shontell: So as the leader of a company, you have to lead in good times and bad.....You’ve had talcum powder, lawsuits and opioid crisis to deal with, COVID, having your vaccine essentially be dismantled. How do you lead in those hard times? How do you encourage your team to not lose morale? Stay focused, stay focused on the mission when there’s a lot of hardship around. 

                  "Duato: Yeah, we do it with conviction, conviction on the principles of our credo that by the way, this year is the 80th anniversary of the credo was written..... (T)he people in the company working at Johnson & Johnson have a genuine passion of doing the right thing. And we don’t do it for the recognition. We do it because we have convictions. And those convictions normally help an organization to manage change. I’m convinced that purpose-driven organizations are much better in managing change. And our organization has a strong tradition of being a purpose-driven one. Internally we say we are the original, mission driven company, based on the fact that our credo was written 80 years ago. 80 years ago talking about putting the patient first the employees, the communities, and then if you do the right thing, it’s going to be good for the shareholder was very innovative, very different. So I think that that’s part of the energy that people at Johnson & Johnson have in order to navigate the ups and downs that anything in life it’s going to present you with."

              (iii) press release of the day: The Walt Disney Company announced last Thursday in this press release the appointment of a new Chief Diversity Officer, reporting to the CHRO, as follows:

                    "Tinisha Agramonte has been named Senior Vice President and Chief Diversity Officer (CDO) of The Walt Disney Company, effective immediately. As Chief Diversity Officer, Agramonte will report to Sonia Coleman, Senior Executive Vice President and Chief Human Resources Officer. Agramonte will lead Disney’s diversity, equity and inclusion strategy, helping the company inspire a world of belonging through stories and storytellers who reflect the rich diversity of our world......

                   "Agramonte joined Disney a year ago, as Vice President of Diversity, Equity and Inclusion (DEI) Talent Outreach & Development with Disney Parks, Experiences and Products.....Prior to joining Disney, Agramonte was named the first CDO at Motorola Solutions......"

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