IBM hires Gary Cohn, former Trump economic adviser
Is there a new calculus for brands hiring administration officials?
It’s not easy being a ~BRAND.
You pay millions of dollars to create an image, spend millions more on sending that message of your image out to the masses through print, tv, out-of-home, digital ads, corporate sponsorships, stadium namings, media partnerships, anywhere you can slap a logo (whether that spend works, well, that’s a whole other ball of wax).
Your leaders give speeches, appear on panels, write papers all touting your company, your products, and your services.
You have teams dedicated to crafting the perfect Tweet or TikTok post. Decisions are made by committee, involving everyone from marketers to public relations agencies to lawyers.
You also start to wade into waters typically roped off for companies. You make proclamations of supporting diversity. You embrace social movements. You preach “purpose” and corporate responsibility.
But then as you say one thing, your recent history shows you do another.
In 2019, you apologize for using racist descriptors like “yellow” and “mulatto” on your job board.
In 2020, you settle a lawsuit alleging fraud and racial bias in the workplace from a Black sales executive.
Also in 2020, the EEOC determines that you had a pattern of age discrimnation.
All of these have an impact on the business, but whether they impact your public perception, that’s a little unclear. Businesses doing naughty things is nothing new, and you’re not the only one that operates a ‘do as I say not as I do’ philosophy.
But what happens when you enter a public political game that, in normal times, most people don’t pay attention to, but in this moment, can be a toxic decision?
(Image via Saul Loeb | AFP | Getty Images)
In 2021, you hire Gary Cohn, former president and COO of Goldman Sachs (serving during the years the bank was infamously labeled as a vampire squid) and director of the Economic Council for Donald Trump for 18 months.
As the Trump administration ends, companies will make complex calculations on whether to hire former officials. It will be interesting to see which companies will embrace Trumpists, putting members of the administration on their boards or leadership positions. It’s starting to happen.
Two weeks ago, Politico reported that:
A unit of UnitedHealth Group has hired a former HHS official who played a key role in the department’s selection of the insurer to dispense $30 billion in Covid recovery funds to health care providers affected by the pandemic, according to two people familiar with the matter.
William Brady, who was chief of staff to the deputy secretary at HHS, recently started as the vice president for digital at UnitedHealth's Optum, where he is working on technologies for consumers.
After leaving the White House in 2019, former White House chief of staff and former Secretary of Homeland Security for President Trump, John Kelly joined the board of directors at Caliburn International, “the nation's largest facility for unaccompanied migrant children,” according to CBS News. Caliburn is the parent company to Comprehensive Health Services.
CBS News reported:
During Kelly's tenure, the administration pursued ambitious changes to immigration enforcement, and the average length of stay for an unaccompanied migrant child in U.S. custody skyrocketed.
In the past year, Comprehensive Health Services, the only private company operating shelters, became one of the most dominant players in the industry. Last August, it secured three licenses for facilities in Texas, totaling 500 beds, and in December, the Homestead facility began expanding from a capacity of 1,250 beds to 3,200.
Located on several acres of federal land adjacent to an Air Reserve Base, the facility is the nation's only site not subject to routine inspections by state child welfare experts.
Teens sleep in bunk-bed-lined dorm rooms, ranging in size from small rooms that fit 12 younger children to enormous halls shared by as many as 200 17-year-old boys, in rows of beds about shoulder-width apart.
For a company like Caliburn, having Kelly back in the mix (Kelly was on the board of DC Capital Partners, an equity firm that owns Caliburn, is on brand, one it probably doesn’t care much about.
For a company like IBM, however, public perception matters a bit more. While IBM leans B2B, it does have a consumer face. Statista shows that IBM spent more than $1.6 billion in advertising last year.
Studies show that Gen Z and Millennials attach importance to how a company behaves. The decisions a company makes from being a “good corporate citizen” has an impact on whether a person decides to use that company’s product or service. It also allows the company to say and do things others might not.
Ben & Jerry’s can earnestly boycott Facebook over spreading hate because the ice cream company has shown time and again that its values are consistent, whereas a company like Nike might have a harder time defending its attachment to advancing racial equality after several discrimination lawsuits.
I reported last year on a survey from DoSomething that found brands often miss the mark on cause marketing (which is when a company tries to show customers that it is ‘doing good’) because the brand looks at the message as a tactic, not a way of life.
The report, which surveyed 1,908 DoSomething.org members ages 13–25 about their awareness of 88 retail and consumer brands’ support of social causes, platforms and issues, found that two out of three young consumers (66%) say that a brand’s association with a social cause positively influences their overall impression of the brand. Moreover, 58% say this association will affect their likelihood of purchasing that brand.
With Trump administration officials, the lightening rods they are, going through the revolving corporate door, a brand now has to determine whether they can weather whatever storm follows.
CNN buckled when it hired Sara Isgur, a GOP public relations official and spokesperson for former Attorney General Jeff Sessions. After hiring someone from the Trump administration with zero journalistic experience to run and oversee political coverage at the news network, facing internal and external backlash, CNN moved her to ‘political analyst.’ A talking head.
For IBM, it has considered and weighed and discussed what negative effect placing Cohn in the Vice Chairman spot would look like, and decided there were more pros than cons.
Will other companies follow in hiring Trump officials? We’ll find out very soon.
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Phish, “2001”
Some interesting links:
For media companies who are all-in on the grift:
Exclusive: Pandemic relief aid went to media that promoted COVID misinformation (Yahoo News)
For media companies trying to fight opacity:
How we built a Facebook inspector (The Markup)
For some literal cloak-and-dagger stories:
Inside the C.I.A: She became a spy for Planet Earth (NYT)
For the magic of movie-making:
The oral history of 12 Monkeys (Inverse)
For TikTok crossovers:
This week in TikTok: How a Ratatouille joke led to a Broadway musical (Vox)
Gen Z is using TikTok to encourage youth voter turnout in Georgia's runoffs (NBC News)
For released journalists:
Ethopian police release detained Reuters cameraman without charge (Reuters)
For bets on whether technology is good:
A 25-Year-Old Bet Comes Due: Has Tech Destroyed Society? (Wired)
For media unions:
Union Seeks Removal of Alden Members From Tribune Board in Wake of Buyout Offer (WSJ)