Rift Widens Between Trump and Business Leaders

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The exodus began Monday, when Merck’s chief executive said he was resigning from Mr. Trump’s manufacturing council, citing the president’s tepid early statement on the violence in Charlottesville, where white nationalists staged a weekend march that turned violent. On Tuesday, the leaders of a labor group and a nonprofit business alliance resigned from the same panel. Mr. McMillon of Walmart has chosen to remain on the president’s economic advisory council, despite his criticisms.

Having come into office boasting of his business bona fides, Mr. Trump was quick to forge ties with the corporate world. Central to these efforts was the formation of the business advisory groups made up of executives who would help shape policy discussions.

Dozens of prominent business leaders joined the panels, and in the first weeks of Mr. Trump’s presidency, numerous meetings were held at the White House. Yet the early momentum dissipated and few meetings of the advisory groups have been held since.

For the chief executive of Intel, who stepped down from the manufacturing council on Monday, the journey from engagement with the new president to a public breakup played out over the course of months.

Brian Krzanich, the Intel chief, was curious about the Trump movement and, during the campaign, planned to hold a fund-raiser for Mr. Trump at his home to hear his views — only to cancel it after an outcry in Silicon Valley. Nevertheless, when Intel decided to expand a plant in Arizona in February, Mr. Krzanich called Mr. Trump and joined the president to announce it at the White House, even though the long-planned project was initially announced with President Obama.

Yet Mr. Krzanich has publicly disagreed with Mr. Trump on key issues, like the president’s proposed immigration ban in January and the decision to withdraw from the Paris climate accords.

The president’s response to the weekend’s violence in Charlottesville, Va., was the final straw. In a thinly veiled reference to Mr. Trump, Mr. Krzanich wrote that he was disturbed by people in Washington who “seem more concerned with attacking anyone who disagrees with them.” In a nod to the protesters who challenged the white supremacists as well as to Kenneth C. Frazier, the chief executive of Merck, who quit the council early on Monday in protest of Mr. Trump’s actions, Mr. Krzanich added, “We should honor – not attack – those who have stood up for equality and other cherished American values.”

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After deliberating over the weekend and on Monday with senior executives and other advisers, Mr. Krzanich notified the council of his decision in writing on Monday night and published a blog post explaining it.

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The Business Leaders on (and Off) Trump Councils

Several executives have resigned from presidential advisory councils as they have opposed stances taken by President Trump.


The willingness of Mr. Krzanich and other C.E.O.s to walk away from the advisory panels highlights an uncomfortable reality for Mr. Trump: He billed himself as the businessman-president, but some executives no longer want to work with him.

“This should be his strong suit: courting C.E.O.s,” said Douglas Brinkley, a presidential historian at Rice University. “Instead, Trump finds himself with C.E.O.s not wanting to be in a photo op with the president. What should have been an honor has become an albatross.”

Many executives remain on the various councils, including the leaders of Boeing, Amazon and Oracle. And since taking office, Mr. Trump has met with hundreds of business leaders.

Several people involved in the panels also say that they can have a real impact on policy. Earlier this year, members of one of the advisory groups urged the president not regard China as a currency manipulator. That input, from a group led by the Blackstone chief executive Steve Schwarzman, seemed to inspire a change of stance on Mr. Trump’s part that may have smoothed relations with that country.

Even those companies that decided to remain on the panels have debated about how to proceed. General Electric, which on Monday said its chairman, Jeffrey Immelt, would continue to advise the president, did so after careful deliberation.

A handful of top G.E. executives worked on a statement that “acknowledged what the company’s values are,” condemning bigotry and racism. They did not check with the board, but did consult with G.E. diversity groups, including the one representing African-Americans in the company, to ensure that the statement was in sync with “the pulse of the company,” before releasing the statement, according to a person with knowledge of G.E.’s thinking.

The president’s business advisers are in a quandary, said Jeffrey Pfeffer, professor of organizational behavior at Stanford’s business school. Among the considerations C.E.O.s must weigh when contemplating whether to step down from the advisory groups: the benefits of having a seat at the table, the political preferences of employees and customers, and the potential consequences of slighting the president.

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From left, Brian Krzanich, chief executive of Intel; Kevin Plank, the founder of Under Armour; and Kenneth C. Frazier, chief of Merck, resigned from a presidential advisory panel on Monday.

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Ethan Miller/Getty Images; Steve Marcus/Reuters; Mario Tama/Getty Images

“It’s easier, and it’s less offensive, to not take the position in the first place, than to take it and to, relatively quickly — six months later — say, ‘Whoops, I’m out of here,’” Mr. Pfeffer said. “Now you’re offending him. So I’m sure the calculus changes.”

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On Monday, Mr. Frazier of Merck, Kevin Plank of Under Armour and Mr. Krzanich of Intel stepped down from the manufacturing council. And Tuesday morning, Scott Paul, the president of the American Alliance for Manufacturing, a nonprofit group, said on Twitter that he, too, was stepping down from the manufacturing council “because it’s the right thing for me to do.”

After Mr. Trump on Tuesday equivocated in his criticism of far-right hate groups, Richard Trumka, the president of the A.F.L.-C.I.O., and Thea Lee, the deputy chief of staff, also stepped down.

“We cannot sit on a council for a president who tolerates bigotry and domestic terrorism,” Mr. Trumka said. “President Trump’s remarks today repudiate his forced remarks yesterday about the KKK and neo-Nazis. We must resign on behalf of America’s working people, who reject all notions of legitimacy of these bigoted groups.”

Crossing a famously sensitive president has its risks.

During the news conference Tuesday, Trump again took aim at Merck, criticizing the company for manufacturing its products overseas. “We want products made in the country,” he said during the news conference. On Monday, he similarly accused the company on Twitter of “taking jobs out of the U.S.”

A company spokeswoman declined to comment on Trump’s claim that the company was moving jobs abroad.

Some companies on the council, including Boeing and Lockheed Martin, do substantial business with the government, adding another complex dynamic to their calculations. But the consensus among business leaders was that the risks of crossing Mr. Trump had diminished in recent months.

“The risk calculus has changed dramatically,” said Scott Galloway, a professor at New York University Business School, who sits on several corporate boards. “Yes, you may risk a tweet from Trump. But his tweets are increasingly flaccid.”


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