John Mackey and Corporate Transparency--The Risky, Essential Value
Saturday, July 28, 2007 / KW
This isn't a blog devoted to corporate communications, public relations, or business transparency. But all those topics are deeply intertwined with the theme of sustainability.
As we explain in our book, sustainability today is about doing business in an interconnected world and paying attention--not just lip service--to the responsibilities that entails. And in an interconnected world, you can't afford not to communicate with all your stakeholders. You need to listen to them, learn from their gripes and demands, and work with them to create meaningful improvements in the way you operate. And you need to talk back to them, presenting your side of controversies honestly and clearly, and claiming your fair share of credit for the genuinely good things you do.
For these reasons, we pay a lot of attention to how well corporations connect with the world around them. A few do a great job. Most, not so great. And one of the weirder current stories of bobbled communication efforts involves one of America's otherwise more responsible, sustainable companies--Whole Foods.
As you've probably heard by now, Whole Foods' founder and CEO, John Mackey, has gotten caught up in controversy over a series of unfortunate communications missteps. They include his vocal complaints about what he perceives as biased enforcement of the antitrust laws by the FTC (seeking to block Whole Foods' merger with Wild Oats while approving other similar acquisitions) and his posting of scores of pseudonymous messages on a Yahoo chat site that lauded Whole Foods and dissed the future prospects of Wild Oats.
Mackey has apologized to shareholders for his indiscretions, but this hasn't deflected an ongoing SEC probe into whether his postings violated corporate disclosure rules, as well as a wave of criticism from various watchdog groups and commentators ("monumental poor judgment," in the words of Nell Minow).
With this background, we were interested to read a recent Fortune magazine interview with Mackey in which he sounded a defiant note about not allowing his own CEO blog to be silenced, despite the controversies swirling around him. When the interviewer questioned Mackey about "the proper role for a CEO's blog," he responded:
It would be a mistake, however, for CEOs to conclude that the Mackey saga demonstrates the folly of striving for transparency. If anything, the lesson is just the opposite. Mackey's mistake was hiding his identity behind a false identity while promulgating messages that served his own interests and those of Whole Foods. It wasn't transparency but opacity that got him in trouble.
The World Wide Web makes it possible to communicate anonymously (as the famous cartoon says, "On the Internet, no one knows you're a dog"). But anonymity is a luxury that company chieftains can't afford to indulge. If you're a business leader, you're a public figure, and you need to behave like one. That means taking responsibility not only for your actions but also for your words, whether you're being interviewed on CNN or typing an off-the-cuff blog posting in your pajamas at 2 a.m.
Are there risks involved in taking this attitude? Absolutely. But trying to elude responsibility for the messages you send is even more risky--as John Mackey and Whole Foods have discovered.
0 comments -
Add a comment - As we explain in our book, sustainability today is about doing business in an interconnected world and paying attention--not just lip service--to the responsibilities that entails. And in an interconnected world, you can't afford not to communicate with all your stakeholders. You need to listen to them, learn from their gripes and demands, and work with them to create meaningful improvements in the way you operate. And you need to talk back to them, presenting your side of controversies honestly and clearly, and claiming your fair share of credit for the genuinely good things you do.
For these reasons, we pay a lot of attention to how well corporations connect with the world around them. A few do a great job. Most, not so great. And one of the weirder current stories of bobbled communication efforts involves one of America's otherwise more responsible, sustainable companies--Whole Foods.
As you've probably heard by now, Whole Foods' founder and CEO, John Mackey, has gotten caught up in controversy over a series of unfortunate communications missteps. They include his vocal complaints about what he perceives as biased enforcement of the antitrust laws by the FTC (seeking to block Whole Foods' merger with Wild Oats while approving other similar acquisitions) and his posting of scores of pseudonymous messages on a Yahoo chat site that lauded Whole Foods and dissed the future prospects of Wild Oats.
Mackey has apologized to shareholders for his indiscretions, but this hasn't deflected an ongoing SEC probe into whether his postings violated corporate disclosure rules, as well as a wave of criticism from various watchdog groups and commentators ("monumental poor judgment," in the words of Nell Minow).
With this background, we were interested to read a recent Fortune magazine interview with Mackey in which he sounded a defiant note about not allowing his own CEO blog to be silenced, despite the controversies swirling around him. When the interviewer questioned Mackey about "the proper role for a CEO's blog," he responded:
I don't want to say what the proper role for a CEO's blog is. We want to communicate as honestly as we can. I am talking about the things I most care about. I don't do what other bloggers do. I don't post all the time. The great thing about blogging is that I don't need you journalists to interpret me anymore.Strong, forthright language, and for those of us who believe in the value of transparency, rather heartening. But then we tried logging on to Mackey's blog to read his latest honest, spin-free comments on business. And here's what we found:
Dear Stakeholders,So much for Mackey's experiment in unfettered corporate honesty--at least for the time being.
A Special Committee of our Board of Directors' is conducting an independent internal investigation into online financial message board postings related to Whole Foods Market and Wild Oats Markets. In light of this, it is in the best interest of the company to temporarily hold off on posting on my Company blog. The ability to post comments to this blog will be disabled during this time as well. I look forward to resuming our conversations and plan on being in touch with you again soon.
Best regards,
John
It would be a mistake, however, for CEOs to conclude that the Mackey saga demonstrates the folly of striving for transparency. If anything, the lesson is just the opposite. Mackey's mistake was hiding his identity behind a false identity while promulgating messages that served his own interests and those of Whole Foods. It wasn't transparency but opacity that got him in trouble.
The World Wide Web makes it possible to communicate anonymously (as the famous cartoon says, "On the Internet, no one knows you're a dog"). But anonymity is a luxury that company chieftains can't afford to indulge. If you're a business leader, you're a public figure, and you need to behave like one. That means taking responsibility not only for your actions but also for your words, whether you're being interviewed on CNN or typing an off-the-cuff blog posting in your pajamas at 2 a.m.
Are there risks involved in taking this attitude? Absolutely. But trying to elude responsibility for the messages you send is even more risky--as John Mackey and Whole Foods have discovered.
Labels: Communications and Marketing, John Mackey, Reporting and Transparency, Whole Foods
Email blog entry to a friend
Comments
Add a comment
