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Why CEOs Are Still Silent · Communication Breakdown

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Welcome back to Communication Breakdown, a weekly podcast from the Observatory on Corporate
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Reputation.
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Thanks for joining us.
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I'm Steve Dowling in Silicon Valley.
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And I'm Craig Carroll in New York City.
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Each week, Steve and I take a look at strategies companies are using the shape headlines and
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sometimes save their skins.
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It's a post game show for PR pros.
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This week, Trump lays siege to Los Angeles and CEOs… stay quiet.
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The corporate silence is deafening, but no longer surprising.
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The nation's second largest city, now the epicenter of President Trump's deportation campaign
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as ICE began rounding up day laborers from home depot parking lots last weekend, prompting
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demonstrations that were mostly peaceful with some isolated and significant exceptions.
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The LAPD, Mayor Karen Bass, and California Governor Gavin Newsom insisted the situation
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was under control.
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But Trump insisted on sending in the National Guard and then the Marines and you know the
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rest.
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And among those caught up in the chaos, downtown LA's growing garment industry which had been
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enjoying a post-pandemic revival.
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But now, uncertainty rains after dozens of immigrant workers were taken away by ICE.
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Some local business leaders have spoken up saying their employees are frightened and the
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enforcement actions are indiscriminate.
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But as far as outcries and reality checks go, that's about it.
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Waymo, a subsidiary of Google, halted its autonomous taxi service after their self-driving cars
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became the target of choice for some protesters.
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Their statement was pretty sparse, abundance of caution, working with local law enforcement.
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Like every other Fortune 500 company, they steered clear of commenting on the broader impact
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of unrest or what's really happening on the ground in LA.
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The protest in LA aren't just testing law enforcement.
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They're testing language.
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What can you say when every word is a trigger, when neutrality itself is interpreted as
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complicity?
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That's the type of brawn and why communicative caution has moved from illegal tactic to a leadership
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imperative.
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But there's a difference between being careful and being invisible and I think that's
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what companies are choosing right now.
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Unfortunately, there's no shortage of reasons for CEOs to not speak up.
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I think the broadest of them seems to be this "it's not my lane, it's not affecting my
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workers yet, it's not an economic issue yet.
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It's localized in this blue city, in this blue state for now."
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And I think also if I'm weighing these from an abundance of caution, immigration is also
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an area where Trump has enjoyed the most support, although it is falling in some recent
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polls, which we should get into later.
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So opposing Trump, let alone opposing him publicly has not been the path of choice for most
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business leaders.
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Even when the economic implications, like over tariffs, have been obvious and dire. It reminded
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me of, this is the first time I visited Australia and I was talking to some PR colleagues there
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and one of them brought up the "tall poppy syndrome," which I had never heard before, but it makes
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sense.
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Usually about being too successful in making yourself a target, the tallest ones in the field
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are the most likely to get cut down to size.
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But in this case, it applies as well.
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I think nobody wants to be a tall poppy.
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There's a reluctance right now to stand out in this environment, be the first one to put
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your hand up, you're likely to get it slapped down.
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Yeah, we're right.
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I mean, no one wants to be the tall poppy right now, sure.
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But it isn't just about standing out that's risky.
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I think it's standing out when you don't have clarity, you know, without knowing
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what it is that's holding you up.
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And silence right now might feel steady, but I think often it's a drift and drift doesn't
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hold when the wind shifts.
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You know, for me, corporate communication should be helping CEOs prepare before they're
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visible, you know, because once you're in the frame, you know, you don't get to improvise,
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so you need to know what principles you're standing on and whether it'll still
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make sense six months from now, even three months from now.
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That's what it means for a message to age well.
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You know, not just survive the headlines, but to make sense and hindsight and the only
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way to do that is to get clear on one thing before you speak or stay silent.
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And that is what principle are we standing on?
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You know, if you can't name it, the message is not going to hold and if it doesn't hold,
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it's not going to help.
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Yeah, I mean, this is not a new phenomenon, but it does feel more pronounced in this second
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Trump administration.
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And when things get uncomfortable, sometimes this instinct kicks in and corporate leaders
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think that if they stand perfectly still, somehow people will forget that they're there.
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Yeah.
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It's not a sustainable position, but again, in this age of Trump, the news cycle moves so
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fast.
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Another factor, I mean, if you remember this time last week, you and I, we made the last
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minute decision to talk about Elon and Trump on the rocks- that that relationship
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had finally imploded.
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That feels like a million years ago.
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So if you're a CEO that's on the fence about making some sort of comment here, maybe
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you're just banking that this will be forgotten too.
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And you're right to say it isn't new.
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You know, the instinct of freeze has been around for years.
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What's different now is that the system almost rewards ambiguity- until it doesn't- and
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in the age of Trump visibility comes with pressure, but invisibility doesn't mean safety.
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It just means you're unprepared when your number comes up.
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Yeah, I think another reason that, probably why if they were considering
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making a comment at all that they're holding back is this dynamic that we've
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started to call the TACO trade - Trump Always Chickens Out
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I think everybody realizes and maybe banks on that, you know, nobody be surprised if we
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woke up tomorrow morning, Trump has declared victory for some reason and pulls out of L.A.
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like nothing happened.
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And I think CEOs are familiar and probably warming up to this dynamic at some level.
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As there going, why should I waste any political capital, take any risk of being seen as
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oppositional to Trump when this could all go away in the blink of an eye?
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But I worry that there's an accumulation of these things and to your point, staying silent
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is putting people at risk.
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Yeah.
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It's a muscle that needs to be exercised.
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I think companies need to be talking about things that affect them and affect their
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communities and we can get into some ideas, maybe in a little bit about how they could be
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handling the situation differently.
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Yeah.
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You know, sure, if this were just about L.A., I think that idea would hold up, but this
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idea of like waiting it out and not burning political capital and just hoping he backs down.
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This isn't staying in one city, right?
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It's already moving in to markets where the company is operating, where their
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employees live, where their brand equity is actually exposed.
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So the risk is in that Trump won't follow through.
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If that the situation escalates and you've done no prep, right?
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There's no interon alignment, no clarity on who needs to hear what, no principal guiding
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your posture if it hits your front door.
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And if nothing else, this is the moment to get your position straight. Not so you can speak
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today, but just so you're not scrambling tomorrow.
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Yeah.
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And just before we wrap up on the dynamic that's sort of gripping the corporate
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communications field right now that we had two developments this week that I think probably
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only reinforced this conventional wisdom and just to put a bow on it,
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like the first one was that Elon backtracked, right?
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Elon apologized after a phone call with Trump, maybe, you know, his pressure, maybe
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it's just FOMO.
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And so I think it reinforced that like being oppositional to Trump is not, is not a winning
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strategy.
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But Elon, as we said, is a special case.
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I don't think everything that he does is instructive for, for the broader audience.
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More importantly, I think was Christy Walton, whose father-in-law was a Sam Walton, the founder
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of Walmart.
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She bought a full page ad in the New York Times calling for people to mobilize and protest
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against Trump.
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That prompted calls for a mega boycott of Walmart.
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I'm skeptical as to whether that pans out.
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But it adds fuel to this anti-corporate sentiment on the populist right that I think is very,
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very concerning for a lot of corporate leaders.
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And it also interestingly drew out Walmart a bit and they gave a statement to the New York
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Post condemning the violence in LA, supporting law enforcement, expressing concern for the safety
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of customers.
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But I do feel like they said the very bare minimum.
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Yeah, I think this is where the lines get blurry pretty fast.
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Christy Walton speaks out as an individual, but the name still carries institutional weight.
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So even if Walmart's distancing is factually accurate, it doesn't shield them from the narrative
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drag that's occurring, right?
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So look, to their credit, Walmart responding quickly, that's awesome.
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They stuck to safety, lawfulness.
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And they made it clear that the ad was in thers, that's smart.
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But this is also the kind of moment that exposes just how fragile the boundary can be between
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personal action and perceived corporate stance, especially with legacy families and iconic
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brands.
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So I think for everyone else, the lesson isn't just be ready to issue a statement.
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You've got to have clarity ahead of time.
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It's not just on what you'll say, but also on what you're responsible for because in a moment
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like this, silence delay or inconsistency can look like an endorsement, even if it's not
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just a messaging problem.
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That's a governance problem.
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Yeah, we should point out that I think this was really the operative part of the Walmart
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statement, which was the advertisement from Christie Walton is in no way connected to or endorsed
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by Walmart.
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I think that's what drew them out.
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And then they added the we condemn violence, including when it's directed toward law enforcement
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and the damaging of property as a company with associates and customers in the Los Angeles
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region.
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We remain focused on their safety and that of impacted communities.
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The thing there is, I agree they were smart to clarify and include some comment on the
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region.
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Christy Walton forced their hand and I think they said the right things, but they also
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managed to say as little as possible, which I think was probably the objective.
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And on that score, I'm sure they felt it was a success because the statement, I don't think
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went any further than the New York Post.
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But I think one of the things that comes, like I said at the very beginning, was like, this
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is not our lane.
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There's been a shift, I think, from five, six, seven, ten years ago in how you make these
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calculations.
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Because right now it feels like the bar is very, very high.
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Like you have got, this has got to be happening like in my backyard or in my, at my company
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for me to make any comment on it at all.
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Otherwise, I said before, it's like, this is not my lane.
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Although, Home Depot, it literally happened in their parking lot and I just don't believe
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they've made any comment they referred all the comments to ICE.
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So we've seen this dynamic over the past six months and we keep asking ourselves what is
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going to be the breaking point for corporate leaders to speak out.
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This does not appear to be it, but the popular opinions are shifting.
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The latest polling data that we have just this week, one out of Quinnipiac, one from the
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AP, Quinnipiac's found Trump's approval rating is below 40%.
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AP's about the same job approval.
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He's underwater 21 points overall, 39/60 in the AP poll.
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And I mentioned earlier on individual issues, immigration, I think there's been an area
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where he has consistently enjoyed the most support, although he's underwater even on that
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issue on immigration.
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The AP he's underwater by seven points and Quinnipiac, he's a negative -11 on his handling.
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And that, that Quinnipiac poll was taken over the weekend as the LA crisis was evolving.
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So if people have their finger in the wind saying, well, I don't want to be saying something
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that is going to get me crosswise with a large swath of my customers or in my
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community, the immigration issue, there appears to be some significant softening there.
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Listen, I'm not saying that companies should be making these decisions according to polls,
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but I do think that it's an important signal for companies to understand that where immigration
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was an issue that maybe they didn't want to go near because it was enjoying a lot of
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popular support, we are seeing those numbers change.
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And that's significant and it's because of, I think, the actions that Trump has been taking.
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Yeah.
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You know, the thing is, you know, business leaders step up now just because the polling
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is shifted, I think it undermines entire message, you know, it just calculated as if they
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were waiting for a crack in the armor instead of acting on principle.
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That's just not moral clarity.
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That's just market timing.
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So right now, corporate communication should be pushing back on that instinct hard, right?
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Because once you speak, you're setting a standard and it looks like, you know, you only found
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your voice once it was politically safer to do so.
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You've already lost credibility with people who needed to hear from you earlier, you know,
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employees, communities or, you know, values, driven investors.
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But I think that's where discipline matters.
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You know, you don't speak because the number is deep, you know, you're speaking because
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your internal posture is already settled because you know, you've already done the work
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to know what you stand for and who you owe coherence to, what your silence would signal if you
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let it stretch on to long.
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You know, that's not PR.
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That's just good governance.
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And I think it's what separates reaction from leadership.
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Yeah.
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And in my opinion, everybody's late right now and everybody is signaling something with their
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silence, whether it's acceptable to their audiences, they're going to know better than
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we are.
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But I do think there are ways for companies to show up better right now.
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Because, you know, they're always claiming to serve communities, not just shareholders,
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well, Los Angeles is a community.
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And right now it's in trouble.
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And I think this is a time for them to show up.
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One of the things that really strikes me is that the stand up between California and
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the feds is really an information disinformation war.
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And one really important service that companies can provide is the reality.
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Check the eyes on the ground.
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You know, Trump is on his social media and getting back up from, from Fox and others.
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LA is some kind of war zone.
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It's not.
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And, you know, if it were, you'd like to think the companies would be taking steps to protect
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their employees.
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But why should we wait for that?
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I think millions of people are going to work in LA every day.
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It's business as usual for the vast majority of people and of companies.
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Somebody, like, please speak up about this.
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It's really just telling the truth.
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It's not a political act.
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And what worries me is that companies who are silent are creating the space for more
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disinformation.
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Yeah.
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So you have operations in LA, you have employees in LA, suppliers, partners, whatever.
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This whole, it's not my lane argument gets very thin.
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And people outside of LA are getting sharply contrasting, contradictory stories about what's
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really happening.
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And there are ways to do this without putting your thumb in the eye of the administration.
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It doesn't have to be a statement against anybody.
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It can be in support of your people and I would argue of in support of good business conditions.
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Now is the moment to talk about those principles, those values.
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Yeah.
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You know, I'd say this, you know, if you have operations in LA, now certainly the time to
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show up.
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You have clarity and not adding to the noise.
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But, you know, if you don't, this is still the moment to get ready for when it does reach
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the communities that you serve because it is expanding.
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You know, not every company needs to be issuing a statement about LA, but they do need to
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be asking what happens when it's Atlanta, what happens when it's Phoenix or some suburb
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where we quietly rely on our fulfillment and our, our labor.
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You know, so I think the most important thing that leaders can do right now is stop treating
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this like it's a one city event and start scenario testing.
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You know, what they'll say, who they'll say to, what principles are guiding their posture
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when it's their backyard.
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You know, you don't wait for the chaos to reach a doorstep to decide where you stand, you
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decide now and then you act when it's your lane, not before, not after.
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And I think that's how you protect people and credibility at the same time.
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Yeah.
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And again, I would argue that it really does depend on how you look at it, but I think there's
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a really strong argument for a lot of these companies who are not saying anything that it
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is their lane.
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Yeah.
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I've got to believe that the business community still holds some sway.
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And even in this polarized era, there's still a role for businesses, for corporate leaders
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and their voices.
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I think that they can and should be among the most trusted figures in public life.
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And they can speak with moral clarity and it can cut through the noise.
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We've seen that in previous episodes like the summer of 2020 after George Floyd was
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murdered in the wake of Trump's travel ban eight years ago.
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And yes, everybody has learned lessons from that and probably the number one lesson is don't
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go overboard.
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But there's a big difference between that and again, being invisible.
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The caution is a strategy disappearing is a choice.
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I think it's the wrong choice where companies could be in there helping to better inform
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people and helping shape the narrative that, you know, again, for stability in our cities
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is important for business.
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That should be squarely in your lane.
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Yeah.
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Well, look, we can't have a podcast without having a good acronym.
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So I'm going to come back to a couple that we've had.
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All right.
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So we have several things that are going on.
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When it's a question, OK, is this crisis, is this chaos?
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Surprisingly, people are asking that.
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It's like trying to decide what's the right frame for responding, right?
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And the reality is Los Angeles is now a crisis, right?
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But there's a couple that we can take up.
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One is that over the past few weeks, we've been talking about alignment signaling.
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I don't think this is a moment where alignment signaling is at stake, but the framework that
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we have for working through alignment signaling still applies.
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And just to be just to remind people, alignment signaling is a principle where you can sort
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of speak out against something, but you can also signal your alignment.
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You can also say, well, we agree with the principles.
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We agree with what you're trying to get done, we just may not agree with how you're trying
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to do it.
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But I think what you're--
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Yeah, especially how do you move forward with both sides is the point, right?
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In this current environment, companies have to be concerned with speaking out against
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Trump and still maintaining access.
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If they want to speak out here on the issue of immigration, the question is, how can we
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do it in a way?
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And I think the ways can be the alignment is not so much with Trump, but the alignment
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with what Trump says that he stands for, which is our country, right?
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So if we're appealing to-- that means appealing to the nation's values and the principles of
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our country tied to democracy, for example.
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But yeah, OK, so there's a couple.
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One is the access model.
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It's an acronym for how we think about speaking truth to power and how we think about calibration.
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So one is, I'll just work through the access model and then we'll talk a little bit more
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about community to give caution, which is when we started at the beginning.
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So access stands for acknowledging the environment, which is that this is really not a great situation
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for us to be in either as a country or this as an immigration issue.
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Second, the seas calibrate your public proximity.
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You got to contain your message risk.
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E is to engage through policy, not personality.
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And then the DSS, you got a signal stakeholder awareness and you got a scenario test, the
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blowback, right?
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So you have to be able to anticipate what's going to happen.
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So it's not about alignment as a legion.
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It's about calibrating your presence, protecting your message integrity and knowing which audience
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is need what kind of clarity for you.
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So that's the first one of the access model.
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Yeah, and I think that the key point for me in there is policy, not personality.
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We've seen some public figures go to almost comical lengths to make statements about what
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Trump is doing and just not mentioning his name.
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They're like John Roberts, the Chief Justice, made a pretty significant statement.
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It was a couple of months ago by now.
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It's all a blur.
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But Trump was asked about it and he said, well, he didn't mention me by name.
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It almost like gives Trump an out.
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He's not blaming me.
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And to me, that punctuated this idea of policy, not personality.
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We can say that things are not going well or they're not being executed the way they
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should be.
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You can not pull personality into it.
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That may be a more advantageous approach.
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I think one of the things that is complicating this right now is that you said earlier that
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every word is a trigger.
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It's hard because everything, everything, as we've seen in multiple issues over the past
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many months, everything gets politicized.
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This is a situation that is hyper politicized because you have the democratic leaders of
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Los Angeles and the state of California opposing Trump.
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I think originally on principle and then I think being a little opportunistic in New
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Soms case, taking some shots at Trump.
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But I think that that's the sticky part is that if you are to oppose, if you were to get
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out there and say, not everything in LA is terrible, that the right is going to immediately
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say, oh, well, you're on Gavin Newsom's side.
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I think that is the tightrope that companies probably have to walk.
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That again gets into the challenge with alignment signaling is that you're trying to say something
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that's still going to be true today, three weeks from now, six months from now.
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We're going to have to work with this administration.
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We may not agree with everything.
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There are going to be times when we need to speak out like now on policies that we don't
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agree with, but we have to find ways of not betraying our values or principles and living
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up to the expectations that are stakeholders and even the public have for us.
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All that is about the central idea, the challenge of alignment signaling and the idea of
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the access framework is about keeping your eye on the ball.
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The idea is speaking truth to power, speaking out, but still being able to stay in the room.
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That's the idea of access behind the acronym.
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What's the other is that right now that when companies are on the verge of speaking out,
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and it raises a moment of how are we going to roll or blade through these landmines, if
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you will.
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I think that's where this idea of communicative caution comes into play.
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It's a part of the work that we're doing on chaos management as opposed to crisis management.
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So tied to this idea of chaos management is the steady model.
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I think that's where it applies for companies now to preparing to speak out.
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So steady stands for as strategic ambiguity, speaking out without overcommitting too soon.
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T timing awareness, knowing when to speak, when to hold and when to shift, equilibrium,
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you got to stay balanced, not reactive, not performative.
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Assessment is about you have to be constantly paying attention on what's changing and who's
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watching and where the risk is and yet maintaining the D discipline, sticking to message principles
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even under stress.
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And then the why of steady is yielding, adapting without losing your footing.
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So this isn't about playing it safe.
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It's about playing it smart, being present without being pinned down.
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And that's how you protect your credibility.
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You got to stay coherent across audiences and you still got to say something now that
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is still going to hold true six months from now.
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And I think that's where communicative caution matters.
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Not to say less, but to say the right thing, the right way to the right people.
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It's not silence.
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It's just simply discipline under scrutiny.
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Yeah.
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And I would argue that it is being true to yourself in that statement.
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And one of the things that we keep coming back to in this podcast is at least I keep hearing
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myself say it is chart your own course.
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I think to stay steady, you need to set a course to stay steady on.
24:26
And I think in to change the metaphors, I think you need to put a stake in the ground sometimes.
24:31
And I'll suggest a jumping off point here if there are any companies who are looking for
24:36
one.
24:37
And that is all going all the way back to January when the LA region was being devastated
24:43
by wildfires.
24:45
And I think companies then were falling all over themselves to show solidarity with Los Angeles.
24:50
They wanted people to know that they were part of the community because LA was hurting.
24:55
And LA is, you know, LA is hurting again.
24:57
I'll say up front.
24:59
Obviously.
25:00
But it's very different.
25:01
The proportions are way off.
25:03
This is an armed federal presence in LA unwelcome by the mayor and the governor.
25:09
But if you stood with LA in January, I think you should just really ask yourself if there's
25:14
an opportunity to stand with LA again because maybe that's the alignment that you're signaling.
25:19
That's the shared value that people have.
25:22
It's tough because I think especially in, you know, middle America or red states just find
25:28
it however you want.
25:29
There's not a lot of sympathy for Los Angeles.
25:32
Yeah.
25:33
But the truth is there's a lot of working people in Los Angeles.
25:36
We opened the program talking about the garment industry, which is a surprisingly large percentage
25:43
of the American apparel manufacturing industry.
25:48
So I think there's, there's a lot there for companies to align themselves with that should
25:53
be non-controversial even if the situation around them is become very politicized.
26:00
Let's just go to final thoughts here.
26:02
I think that this is, this is a test of principles and values, not politics.
26:07
I think that CEOs don't need to be commenting on law enforcement tactics.
26:12
They have a point of view.
26:13
They should have a point of view on constitutional rights and due process and transparency in government
26:20
and by transparency.
26:22
I mean, what I was saying earlier that, you know, that there's an opportunity here to give
26:26
a view, you know, a ground level view and share that with people and also not create space
26:31
for disinformation.
26:33
And for all those things, if there's no other reason that those are good for business and
26:37
that's, that's your lane.
26:38
Like you have a right to speak up and be an authority on that subject.
26:42
Yeah.
26:43
I'm a little cautious on the values right now unless you're thinking about democratic values
26:49
in the values of our country.
26:51
Small "d," Democrat values.
26:53
Yeah, that's it.
26:54
Small "d," democratic values, that's right.
26:56
Yeah, thank you.
26:57
That's a very good point, right?
26:58
Wait, I'm not leaning blue on that statement.
27:00
I'm actually thinking about the, the country as a whole, right?
27:03
You know, but, you know, the, the real point that I want to, I guess if I were to put my thumb
27:08
down on the scale, it's going to be on, on principles.
27:10
You know, principles of due process, local governance, constitutional rights.
27:15
These are definitely good for business.
27:17
And right now it's what the country needs.
27:19
But not brand positioning, not CSR talking points, just basic commitments to things that make
27:26
democratic society work.
27:27
And again, yes, little "d" here. This isn't what about what makes a company
27:32
unique.
27:33
It's about what we all stand on and what we owe each other as citizens, as, as employers and
27:39
institutions in public life.
27:41
And that's not a political act to me.
27:43
That's a civic one.
27:45
Well put.
27:46
And that's our show for this week.
27:48
We want to thank Shawn P Neal and the team at AdvoCast for producing our podcast with support
27:52
from the people forward network.
27:54
If you have comments or suggestions for the show, we'd love to hear from you.
27:58
Hit us up on LinkedIn or try our email address podcast@ocrnetwork.com.
28:03
Communication breakdown is a production of the observatory on corporate reputation.
28:08
I'm Steve Dowling.
28:10
And I'm Greg Carroll.
28:11
Thanks for listening.
28:12
We'll be back next week.
28:12
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