Executive Insights | November 2011 | By Karon Warren

Should CEOs Weigh in on Politics?

Some of today’s top quick-serve CEOs are stepping into the political fray as things in Washington heat up.

Starbucks CEO Howard Schultz wrote a letter against Washington politicians.
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On August 15, Starbucks CEO Howard Schultz sent a letter to customers complaining of the political gridlock in Washington. The letter called for positive change in the U.S., but also called into question the level of involvement quick-serve executives should have in politics.

For Schultz, the actions of politicians demanded that someone, no matter if he was the head of a global coffee corporation, take action. As he stated in his letter, elected officials “have chosen to put partisan and ideological purity over the well-being of the people.”

Schultz is now trying to lead a charge against politicians and their bitter partisan battles.

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He’s encouraging fellow CEOs to withhold campaign contributions, “until a transparent, comprehensive, bipartisan debt-and-deficit package is reached that honestly, and fairly, sets America on a path to long-term financial health and security.”

More than 100 well-known business leaders, along with 20,000 others, have pledged to join Schultz in this fight. In addition to a number of top-tier CEOs across many industries, several quick-serve CEOs have sided with Schultz, including Ron Graves of Pinkberry and John Pepper of Boloco.

This isn’t the only way executives are inserting themselves into the political realm. Many quick serves, for instance, are gaining notoriety as campaign stops. One noted example is Pizza Ranch, which operates 68 restaurants in Iowa and 158 more throughout nine Midwestern states. GOP presidential candidate Michele Bachmann of Minnesota visited a Carroll, Iowa, location in July, while former House Speaker Newt Gingrich popped into an Indianola, Iowa, outlet in June.

For Pizza Ranch CEO Adrie Groeneweg, welcoming politicians for political rallies and events is another aspect of customer service.

“Politicians come to our restaurants because Pizza Ranch connects closely with the communities it serves; it is a reflection of the people and spirit of Iowa,” he says. “Iowans are proud to participate in open dialogue to move our country forward. As CEO of Pizza Ranch, I am committed to delivering the Pizza Ranch communities with a venue that provides fair and open conversation, regardless of political affiliations.”

Politicians also are welcome to meet and greet customers at Sal’s Pizza locations in New England, as candidate Herman Cain did back in June before a debate in Manchester, New Hampshire.

“Developing a relationship with elected leaders can have a profound influence over how an economic plan can impact your business.”

However, for Sal Lupoli, CEO of Sal’s Pizza parent Lupoli Companies, these events are more than just opportunities for his customers to see a political candidate.  

“The CEO of any [quick-serve] organization can have influence on elected leaders,” Lupoli says. “The bigger your business becomes, the more you realize how important relationships with your elected leaders are. Developing a relationship with elected leaders can have a profound influence over the way pending legislation is crafted or how an economic plan can impact your business.”

In fact, he says, every business owner has a responsibility to be politically involved.

“I believe it’s the responsibility and obligation of anyone who employs people to be actively engaged and aware of what is going on in the political realm as new laws may directly impact your business, customers, and employees,” Lupoli says. “Political involvement has never been more important than it is now in light of changing attitudes toward out-of-home dining and this challenging economic environment.”

Although Schultz is taking a national stand against Republicans and Democrats in Congress, Lupoli stresses the importance of being involved at all levels of government.

“It often takes cooperation of all levels to overcome challenges or to take advantage of opportunities that create jobs and help make people productive members of society,” Lupoli says.

For Groeneweg, politics is just one more way to build a relationship with the community his restaurants serve.

“Dedication from your brand to the community is an essential strategy every quick-serve restaurant should use to create a lasting relationship with the people that matter most: their hometown guests,” he says.

Groeneweg encourages community involvement whenever possible, without limiting it to just political endeavors.

“Companies supporting local organizations with active participation and an ongoing presence at community events are proven to be more successful than those that do not,” he says.

“From partnering with neighborhood schools, church groups, and other local organizations, it is not unusual for our entire Pizza Ranch team to actively participate at local charities and events. Becoming involved on a local level increases morale among your team and demonstrates your commitment to the community you serve.”

Whether Schultz’s campaign will have the desired results is still to be determined. However, by banding businesses and citizens together, he writes that today’s business leaders can affect change regarding the dire jobs outlook across the country.

“While economic headwinds affect each of our companies in distinct ways, we can all think creatively about how to accelerate job creation and growth as a collective engine for the country,” Schultz wrote.

“We have to pull this economy forward. We have to lead.”

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