Maybe Whole Foods' board should boycott the CEO
Some great comments over at Consuming Interests on the comments on health reform by Whole Foods boss John Mackey and the resulting boycott effort by people who objected. In a piece in the WSJ, Mackey wrote: "A careful reading of both the Declaration of Independence and the Constitution will not reveal any intrinsic right to health care, food or shelter. That's because there isn't any. This 'right' has never existed in America."
Many of Whole Foods' liberal customers are mad. But the other question is, what does the Whole Foods board think? Mackey probably just cost the company millions in sales and gave it big black eye among its core customers.
Unlike most boycotts, this one doesn't have to reach a mass market to be successful. Whole Foods sells to a niche demographic, and that demographic is precisely the one most likely to respond to the boycott. Whole Foods customers are politically aware, well-off and heavily wired, which means they're also easy for boycott organizers to reach.
This is after years of sock puppeting by Mackey on Yahoo message boards, pumping his own company and trashing rivals while pretending to be somebody else. A Consuming Interests commenter asks a good question:
How many times can this guy screw up? One day he's on yahoo boards pumping his stock and gloating over himself, then onto 'conservative capitalism'... no he's offended 14,000 customers. He's a lose cannon and why I would never invest. I like to store, but their mission is just too mixed.
UPDATE: Here's the headline from RetailWire: "Time for John Mackey to Resign."
UPDATE 2: Interesting discussion going on in comments. Yes, this is America, and the First Amendment hasn't been repealed. But how far should a CEO go in expressing honest but controversial comments when they might hurt the business? Most CEOs shut their traps -- to a fault. Mackey's outspokenness is refreshing. But by speaking out, has he violated his duty to shareholders?







Comments
So basically you are saying that he should be fired from his job for expressing an unpopular politcal opinion.
How very liberal.
Posted by: Anonymous | August 20, 2009 10:56 AM
It doesn't say in the constitution that you have the right to breathe, that you have the right to take a dump. Where in the constitution does it say i can't kill someone? I don't see anything in the constittution that says you have the right to open up an over-priced grocery store that sells crappy tomatoes. Why do Americans think the constitution contains every piece of legal information in the States? Oh yeah, because they don't even have an elementary understanding of how government works.
Posted by: Garcho | August 20, 2009 11:54 AM
Just because a website claims to have 18,000 members that are going to boycott, doesn't mean they are all really Whole Foods Customers.
Posted by: ddddff | August 20, 2009 12:01 PM
What is happening in this country? If you read Mackey's article, he has some good ideas. I don't necessarily agree with all of them, but isn't what made this country great the freedom to express ideas, from which would come good plans? When people are afraid to express their thoughts and ideas, you get tyranny of the LOUD. Loud is not necessarily right, you know.
Posted by: terrica372000 | August 20, 2009 12:04 PM
John Mackey should be fired for puncturing the reality bubble so many of his customers live in. What he did would be like a Disney executive telling fans that the Cinderella that waves from the castle window is an actress and not a real princess.
Posted by: Dan | August 20, 2009 12:51 PM
In response to the previous comment:
>>>>
You missing the point. The writer of this article is clearly coming from a business standpoint saying that, because of what this guy has said.. it will clearly cost his company millions of dollars. ... And maybe the board should boycott the CEO based on bad business decisions he has made (ie. voicing opposing views of that of his shoppers that have been made quite public). It has more to do with the harm it will do to his corporation than his actual views. I thought as a capitalist, you would understand this better... Guess not.
Posted by: J Wolf | August 20, 2009 12:51 PM
Was it crazy, or crazy like a fox? On the one hand, many liberal Whole Foods shoppers for whom the public option in health care reform was their #1 issue will not be coming back. On the other hand, conservative shoppers are now vowing to rush to Whole Foods in support of Mackey's views. If they actually do, and continue coming back, Mackey's brought a new demographic of customers into the store. Will be interesting to see how this turns out.
Posted by: Aminat | August 20, 2009 12:56 PM
Everyone is entitled to their own opinions, but it is always a dangerous thing to very publicly take a position that is contrary to the base of your customers. There are two things most CEO's never mix with business and it is religion and politics. The reasons for this I think are obvious to most. The board and the shareholders have ever right to be mad about this. John Mackey put his own apparent political aspirations above those of the publicly traded company that he runs. Jay Hancock is right, this OpEd will cost Whole Foods millions and millions of dollars.
One of the other problems with John Mackey's OpEd, besides angering the core base of his customers, is his apparent competence and intellect. There is nothing, zip, zero included in the current reforms being pushed by Obama that has any semblance to socialized medicine. The closest thing we have in this country to what is truly defined as socialized medicine is what all our military personnel currently have, and everyone states that they have the Cadillac of health care plans. Ironically no dares take these plans away from our military personnel because it is apparently so well liked. So most are rightly skeptical and think that all this noise is merely a distraction in an effort to protect the status quo.
Either John Mackey knows this and is just pushing Republican and FOX news propaganda or he truly is not intellectually curious enough to research the facts further after he hears them on FOX news. Either way it gives the core customers of Whole Foods much pause in whether they should be spending their dollars at this business and it has shaken their confidence in whether they can truly believe in the quality and safety of the products sold by Whole Foods.
Posted by: E Nelson | August 20, 2009 1:14 PM
I remember when Democrats and liberals were FOR free speech. Apparently those times are gone now. How sad.
Posted by: nostalgia | August 20, 2009 1:57 PM
Possibly the CEO of a company that has acclimated the public to overpriced "health" foods should not be the one we listen to about how to solve our overpriced health care woes?!
Posted by: Kim | August 20, 2009 2:02 PM
No one is or has interfered in Mackey's freedom of speech: We all are free to speak -- and suffer the consequences.
In Mackey's case, he didn't merely speak for himself, which is clearly his right. Instead, he leveraged his position as CEO of Whole Foods to trumpet a controversial political position in a national newspaper. What's more, he amplified the problem by referring to Whole Foods in the editorial itself.
If Mackey can't keep his personal voice separate from his business message, that's his problem.
And he can rightly be called to account.
Posted by: goldstone | August 20, 2009 2:25 PM
Bringing up the right to free speech betrays a lack of understanding of the problem.
Mackey obviously has a right to free speech. The government is not censoring his words in any way. Go home and come back when you have a real argument.
Mackey has a responsibility to his shareholders. A *fiduciary duty*, if you will. He ignored that duty and instead indulged in vanity by broadcasting his opinion to the world, without any regard for the consequences to the business or the investors he answers to. He is a failure as a leader, and that's why he should go, not because he had an opinion that some people disagree with.
Posted by: Indivisible Hand | August 20, 2009 2:29 PM
I remember when Democrats and liberals were FOR free speech. Apparently those times are gone now.
On the contrary, free speech is alive and well. Mackey expressed his view and those who disagreed with it are simply not doing business with him.
Contrast that with lets say...Oooh! the Dixie Chicks! Of whom, Natalie Maines did the unconscionable by expressing her displeasure with then President Bush's Texas heritage and voila, death threats and the need for 24-7 security.
See? That kind of whiny victimization might do well at tea party rallies and town hall protests but in the real world, sane people want context and facts.
Posted by: Paul_D | August 20, 2009 3:37 PM
He should be fired because he got his company into a huge mess with their core demo. He squandered the good will of his customers which (ask any accountant) is the lifeblood of a consumer brand. He can say what he wants but the reprecussions are that he has made his brand unappealling to a large slice of his customer base. He did do his job -- which is increase charreholder value. In fact his actions will cost the company years and many resources to fix.
Very poor management.
Posted by: Chris | August 20, 2009 3:44 PM
Comment: "Just because a website claims to have 18,000 members that are going to boycott, doesn't mean they are all really Whole Foods Customers."
From the thrust of their website, it would appear they are ex-customers or promising not to buy there.
I doubt conservatives who say they are going to will actually rush in to fill up their baskets as a reverse boycott. How dumb is that?
Posted by: mangosantamaria | August 20, 2009 5:39 PM
Given his past behavior, one might hope the board had a damage control methodology in place. Unfortunately, we often learn after the fact that boards of directors are hand-picked and/or intimidated by their CEO. I'm off to Trader J.
Posted by: ann | August 21, 2009 12:32 PM
Anyone who feels that an executive's speech and the interests of his company are or should be divorced should look up Gerald Ratner.
Whilst you are associated, you risk the welfare of the company. He can say what he wants, but there can be a price
Posted by: Brian Witham | August 23, 2009 9:47 PM
what happened with "free speech" This guy ceo or not makes a good argument!!
Posted by: Jim Borland | September 10, 2009 10:56 AM