In the past, CEOs mainly needed to balance the needs of employees, suppliers and shareholders while following government regulations. However, CEOs now face more challenges than ever in an increasingly complex world. With rising global tensions, supply chain issues, climate change pressures and more, multinational companies and their leaders have to juggle competing priorities pulling them in different directions.
CEOs taking political stands can backfire
Some CEOs have started taking stands on social issues to signal their opposition to populism. However, this approach has deepened societal divides without solving problems. Disney’s former CEO Bob Chapek fought over LGBTQ rights with Florida’s governor, contributing to his dismissal. CEO activism on partisan issues rarely helps the bottom line long-term.
Governments exerting more control creates tradeoffs
Governments want to reshore manufacturing jobs, enhance national security over key technologies and accelerate decarbonization. Each goal has merits but flawed means with efficiency, cost and tradeoff implications. Intel’s CEO touted national pride for new US chip fab plants, but Intel also has fabs in Germany, showing geographic tensions.
Stealth strategies won’t suffice amid scrutiny
Some CEOs try avoiding scrutiny by keeping a low profile, taking cues from chastened executives in China. But stealth strategies can appear tone-deaf and invite criticism from lawmakers, like questions about TikTok’s Chinese ownership despite claims to the contrary.
CEOs should focus activism on business impacts
CEOs of global companies can’t fully avoid geopolitics today. But they should choose when to speak up based on long-term shareholder value and direct business impacts. This approach carries more credibility than generalized virtue signaling on partisan issues.
CEOs now face a complex landscape filled with government interventions, public scrutiny and pressure to address social issues. Navigating this requires a focused strategy centered on companies’ commercial interests rather than politics or nationalism.