24 Jan 2017

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It is no secret that President Donald Trump has used his personal Twitter account as a weapon. He uses it to both circumvent the traditional press as well as shame enemies, competitors, beauty queens, journalists, media outlets, foreign leaders and international organizations. He has also used it to spread and deny “Fake News”, take credit for things that were not of his doing and attempt international diplomacy in 140 characters or less.

Trump’s tweets: a new form of corporate risk

There can be no doubt that his Twitter personality – seemingly accessible and politically incorrect – played a significant role in his unexpected journey to the White House. Indeed, one of Trump’s former campaign managers, Corey Lewandowski, remarked that “Donald Trump’s Twitter account is the greatest bully pulpit that has ever existed.”

However, since the election Trump’s tweets have caused more than just groans from the media, but also palpable anxiety in business leaders, as well as spawning new investment opportunities. The tweets have also harmed corporate reputations and impacted market value. Remarkably, the public is actually really concerned about this: according to a recent WSJ/NBC Poll, about seven out of ten adults agreed that Trump’s use of Twitter is dangerous because “in an instant, messages can have unintended major implications without careful review.” Maybe, though, these implications aren’t so unintentional after all. Trump has often used the power of his Twitter feed to distract from negative news that has or will soon break.

The ever-present threat of a “Trump Tweet” will likely lead companies and organizations to reevaluate who their core audiences are. No longer is it simply broad categories like investors, regulators, customers, media, and interest groups. Now, one of those audiences is actually the most powerful man in the world, capable of causing billions of dollars in reputational and market value damage. Organizations need to consider how President Trump will view an announcement and how they should prepare for and respond if they are the target of a tweet.

Many have suggested that Trump is so temperamentally unpredictable that there is no way of knowing what will set him off. However, as Phillipe Reines – the man who “became Trump” for Hillary Clinton to joust with in debate prep – noted “He’s one of the most predictable unpredictable people.” His inaugural address should have removed any doubt about what his priorities are.

Trump’s overarching (if nebulous) goal is to “Make America Great Again!” underpinned with an ideology of nationalism. To accomplish his goal, he wants to bring manufacturing back to the U.S., fix or end “unfair” trade deals and maximize job growth. He also wants to stop the government getting what he regards to be “bad deals” on purchases. We saw this with Boeing and Lockheed Martin and Trump’s related tweets criticizing the way the Air Force One and defense deals had been negotiated. For Trump, success centres around his already- trademarked 2020 re-election slogan: “Keep America Great!”

"Any business that leaves our country for another country, fires its employees, builds a new factory or plant in the other country, and then thinks it will sell its product back into the U.S. without retribution or consequence is WRONG!" – @realDonaldTrump 4 Dec 2016

Rhetorically, Trump is a populist, caring more about what the Average Joe/Janes think than he does about shareholders. This cannot be stressed enough.

This populism could spark a new round of shareholder activism. Many of the regulations that are in place to protect consumers are now under the review of Trump’s “Regulation Czar” Carl Icahn, the well-known activist investor. These activist shareholders will be chomping at the bit if share value is not being maximized.

Business leaders do, to some degree, have a “scorecard” to work against when making an announcement or when their existing contracts or businesses may be…Trumped.

In this new environment, it could be worthwhile for corporate communications teams to consider several things before making announcements:

• Will your announcement impact Trump or his family’s company?

• Will you be outsourcing production, moving manufacturing or building new facilities out of the country?

• Will you be laying off American workers?

• Have you clearly articulated why this action is in the best interest of customers and “the country” (not just shareholders)?

• Can you clearly explain how not undertaking the action will raise prices for consumers?

• Will the government be paying for anything?

• Does this action make America great (in a nationalistic/Trumpian sense)?

None of this is to suggest that the President should determine corporate strategy. However, just as a legal, regulatory or tax environment impacts decision making, so should this. If a Trump Tweet will impact a company’s brand, reputation and value it should be factored into the decision-making process. If Trump’s aim is to shame companies as being un-American, companies had best be ready to respond.

The Damocles Sword of a Trump Tweet could also force organizations to rethink their announcement strategies. Rather than trying to “hide” something – which could engender a more vociferous Trump reaction and send warning signals to the shareholder activist lobby groups – companies who may fall within the President’s radar should clearly rationalize their decision explaining why it is good for consumers, shareholders and the country (even when that may be counterintuitive). An organization needs to have social media posts succinctly addressing each of those issues. While it may not prevent a Trump Tweet, it’s better to be prepared.

Above all, it is imperative not to get into a fight with the Commander-in-Chief. He has a louder, more powerful platform than any organization.

It was Peter Parker aka Spiderman’s uncle – amongst many others – who suggested that “with great power comes great responsibility”. Trump’s Twitter, which he plans to continue to use as President, has immense power and corporations and organizations need to be prepared to respond, well, responsibly to it.

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Elie Jacobs

Elie Jacobs is the president of EJ Strategies LLC and a partner with the Truman National Security Project.

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