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The Limits of Employee Activism: CEO Daily

Good morning.

Readers of this column know I’ve been a fan of employee activism. Employees—millennials in particular—have been at the forefront of pushing companies to focus more on their social impact. At a time when talent is the key business differentiator, talented millennials are forcing employers to bow to their desire to work for companies that are doing good in the world.

But all good things get taken to excess. Two examples yesterday:

—Wayfair employees walked out of the company’s Boston headquarters because of a contract to sell furniture to a contractor furnishing migrant detention centers. Wayfair management responded that it was “proud to have such an engaged team that is focused on impacting our world in meaningful and important ways,” but said it is company practice to fulfill all lawful orders.

—Google employees petitioned SF Pride to “revoke Google’s sponsorship of Pride 2019, and exclude Google from representation in the San Francisco Pride Parade on June 30th, 2019” because of controversial YouTube practices.

Both seem signs of activism run amuck. It is hard to see how stopping Wayfair furniture from reaching detention centers is an effective means of changing immigration policy. And even harder to see why preventing Google from giving money to LGBT causes is good for the LGBT cause.

But both events signal that these employee pressures are becoming increasingly difficult for companies to navigate.

News below. And be sure to read Mary Pilon’s deep dive into the difficulty of valuing girls’ lives in the Larry Nassar case.

Alan Murray
@alansmurray
[email protected]

Top News

Boeing Woes

More trouble for Boeing—the FAA found another software problem in its 737 Max jets, which will now need to stay grounded for longer, possibly into the fall. The new problem relates to stabilizing the aircraft. Wall Street Journal

Democrats Debate

Last night saw the first big debate between Democratic candidates—mostly the lesser-known ones, apart from Elizabeth Warren, Cory Booker and Beto O’Rourke. (The spreads were chosen at random.) Warren, the highest-polling candidate of the group by far, held her own well. And if there was a topic to divide the group, it was Medicare for All. Fortune

Huawei Revelation

The case for seeing Huawei as being tied to the Chinese state has been boosted by a Bloomberg report that notes at least 10 research collaborations between the telecom giant’s employees and the Chinese military—these are just the publicly disclosed examples, which came to light via published periodicals and research databases. However, Huawei claims it did not sanction the projects. Bloomberg

Tesla Batteries

Tesla is reportedly working on its own battery-cell production capacity, so it doesn’t have to rely on Panasonic so much. According to CNBC, the move could allow Tesla to provide “cheaper, higher-performance electric vehicles than it does today, without having to pay or share data and resources with outside vendors or partners.” CNBC

Around the Water Cooler

Facebook Fakes

Facebook CEO Mark Zuckerberg has admitted the company took too long to flag and remove a doctored video of House Speaker Nancy Pelosi, which was edited and slowed down in parts to make her appear incoherent. Zuck: “One of the issues in the example of the Pelosi video… which was an execution mistake on our side, was it took a while for our systems to flag that and for fact-checkers to rate it as false.” BBC

Trumplomacy Latest

President Trump, who is about to attend the G20 summit in Japan, has lashed out at Japan over what he said was an unequal military alliance. “If Japan is attacked, we will fight World War Three…with our lives and with our treasure…If we’re attacked, Japan doesn’t have to help us at all,” he said, suggesting that Japan would watch such an attack “on the Sony television.” CNN

Brazil Cocaine

Meanwhile, a member of Brazilian President Jair Bolsonaro’s advance guard for his trip to the G20 summit may have been carrying 85lb of cocaine, Spanish police alleged after finding the stash and arresting the crew member during a stopover. Full marks to the Financial Times for its awesome headline, “Cocaine in Spain puts Bolsonaro under strain.” FT

Splinternet Fears

Booking.com’s new CEO, Glenn Fogel, writes for Fortune that it’s still possible to avoid the Internet splintering, in particular between China and the U.S. “As business and technology leaders, it is our responsibility to resist the prevailing narrative,” he writes. “Ideally, we’d all live in a unified global market that properly protects intellectual property rights and allows businesses to freely operate in any jurisdiction. In this world, consumers and businesses would adopt the best elements of each national system.” Fortune

This edition of CEO Daily was edited by David Meyer. Find previous editions here, and sign up for other Fortune newsletters here.