Companies say Trump sex talk audio would get most CEOs ousted

Mr Donald Trump speaks to supporters at a rally at the Ambridge Area Senior High School in Pennsylvania on Oct 10, 2016.
Mr Donald Trump speaks to supporters at a rally at the Ambridge Area Senior High School in Pennsylvania on Oct 10, 2016.PHOTO: AFP

NEW YORK (BLOOMBERG) - Mr Donald Trump says he wants to run America like a business. But if America were a public company, Mr Trump probably would be ousted as its chief executive officer after his recent vulgar remarks about women caught on tape.

While Mr Trump's supporters may be willing to write off his talk about making unwanted sexual advances as locker-room banter, corporate boards have been much less forgiving to top officials who engaged in arguably less crude behaviour that could paint the company in a bad light or put it at legal risk.

"Any CEO who got caught making the kind of comments Trump did would be out the door in 24 hours," said Ms Pat Cook, CEO of Cook & Co, a boutique executive-search firm.

It isn't that the mostly male, mostly white realm of C-suite America is puritanical: A litany of corporate scandals proves otherwise. It's that modern corporations operate in a world with hard rules about behaviour, particularly in the office.

As Human Resources tells everyone: Sexist and sexually aggressive speech, let alone sexist and sexually aggressive behaviour, can be grounds for dismissal. The threats - to reputation, worker retention, recruitment and even the bottom line - are too high to tolerate.

"No one wants the public relations, and no one wants the liability," said Ms Wendi Lazar, a partner with law firm Outten & Golden.

 
 

For the most recent example, look no further than Trump friend and adviser Roger Ailes. After 20 years at the head of the Fox News Channel, Mr Ailes was forced to resign two weeks after being accused in a lawsuit of sexual harassment by a former anchor, an accusation he denied.

In another high-profile ouster, the executive chairman of Publicis Groupe SA's Saatchi & Saatchi advertising agency, Mr Kevin Roberts, stepped down in August after coming under fire for saying in an interview with Business Insider that the debate on gender diversity "is all over" and suggesting some women aren't interested in advancing their careers. He apologised for his comments.

"We are in bizarro world" with Mr Trump's taped comments, said Ms Cindy Gallop, a former advertising executive who led the attack against Saatchi's Roberts over his remarks about women. "This is completely and totally unacceptable in the business world. I can't believe we are even having this conversation."

Mr Trump's remarks, caught on a hot microphone before taping a segment for Access Hollywood, weren't the first time he engaged in behaviour that could have gotten another executive fired or at least launched an internal investigation. Throughout the election, he has fought off accusations of sexism while videos, recordings and testimonies from former associates and co-workers outline a history of vulgar comments.

But Mr Trump's business, the Trump Organisation, isn't publicly traded and doesn't have shareholders it must answer to and an independent board of directors with the power to fire the CEO.

Comments about Mr Trump's remarks flooded Facebook, Twitter and other online outlets over the weekend. The speed with which news travels these days has pushed some companies to react more quickly than in the past to allegations of misbehaviour, or worse.

 

"Social media puts it out there, and given the 24/7 instant news cycle, you are basically guilty until proven innocent, so companies are just choosing to err on the side of making a quick decision," said Mr Jeffery Tobias Halter, a former director of diversity at Coca-Cola Co who now consults on gender issues.

"What he said and what he has done is being said and done all over the corporate world, but when it becomes public, there are repercussions," Ms Gallop said. "For a US presidential candidate to be getting no repercussions for being public about this is absolutely horrifying."