Ahead of the upcoming US elections in November, new data from the Yale School of Management reveals that none of the Fortune 500 CEOs are willing to support the presidential candidacy of former President Donald Trump. This lack of support persists despite Trump recently holding a private meeting with 80 CEOs from some of America's largest companies.
Jeffrey Sonnenfeld, who first shared the data in The New York Times, noted that CEOs favour investing where there is the "rule of law, not the rule of rulers."
Decline in CEO Donations
According to data shared via Axios, donations from the country's CEOs have not recovered since Trump became the Republican nominee in 2016. The same scenario occurred when Trump faced Democrat nominee Hillary Clinton in the 2016 election.
While Trump managed to garner support from two CEOs in 2020, no prominent Fortune 500 CEOs have shown support for him in the upcoming election.
"They didn't flock to him before and certainly aren't flocking to him now. Mr. Trump continues to suffer from the lowest level of corporate support in the history of the Republican Party," Sonnenfeld stated.
In a subsequent interview with CNBC, Sonnenfeld clarified that previous reports of Trump meeting with US CEOs referred to his attendance at a quarterly meeting of The Business Roundtable (BRT), a non-profit lobbyist association whose members also include CEOs. Current President Joe Biden was also invited at the time, but he attended this year's G7 summit in Apulia, Italy.
Corporate Fallout
Sonnenfeld explained that much of the fallout among Fortune 500 CEOs stems from Trump's ideologies, which have led to increased protectionist, isolationist, or xenophobic actions. These actions include events such as the white supremacy rallies in Charlottesville, Virginia, and the January 6 United States Capitol attack in 2021.
Potential Support from Bankers
While Sonnenfeld noted that Trump has yet to secure support from Fortune 500 companies, there is potential backing from top bankers in the country, including Steve Schwarzman of Blackstone.
Additionally, many CEOs remain opposed to Biden, primarily due to the administration's antitrust policies and support for stronger capital gains taxes. Despite these issues, many CEOs are still considering supporting Biden in the next election.
"Nobody's saying that the Biden policies are perfect, and there are some problems. But they are dwarfed by the pernicious threat to inflation, economic stability, and, most importantly, democracy presented by the prospective Trump presidency," Sonnenfeld told Fortune.
Some CEOs who have supported Biden include philanthropist Melinda French Gates, Skydance CEO David Ellison (son of Oracle founder Larry Ellison), and Reed Hastings, chairman of the board of Netflix.
Corporate Sentiment
Sonnenfeld also noted that during private conversations with some CEOs, many expressed disdain for Trump's social and fiscal policies. These included executives from PepsiCo, Ford, UPS, Verizon, and IBM, among others.
While corporate America has been relatively silent on their political stance, big financial firms are already strategising for potential outcomes based on either candidate's victory. A recent market outlook published by J.P. Morgan indicated that while the candidates do not directly impact the stock market's performance, there are expected similarities and differences in their policies.
For instance, robust spending on defence companies is anticipated to continue regardless of the election's outcome. However, oil and gas investments are likely to gain more significance under Trump's administration, whereas renewable energy investments would be prioritised under Biden's leadership.
Strategic Financial Planning
Shelby Anderson, Executive Director of J.P. Morgan Wealth Management Wealth Planning & Advice, emphasised the importance of maintaining a clear-headed approach during the election period. "Don't let that emotion get the best of you. Make sure that you are creating a plan – that you are revisiting it often or periodically, especially as life circumstances change – but not letting the emotion in what can seem like a very stressful time leading up to elections really drive our decision-making," she advised.
This comprehensive analysis underscores the cautious stance of Fortune 500 CEOs towards Trump's candidacy and highlights the broader implications for corporate America in the context of the upcoming US elections. As the election draws nearer, the financial and corporate sectors will undoubtedly continue to scrutinise and prepare for the potential impacts of either administration's policies. This strategic foresight will be crucial in navigating the complexities of the political landscape and ensuring sustained economic stability.
