When Meg Whitman was appointed CEO of Hewlett-Packard last September, her longtime personal and political support for Republican presidential candidate Mitt Romney was well known.
Since taking over HP, Whitman has continued to help Romney, who locked up the GOP presidential nomination on Tuesday with his Texas primary win. In March, Whitman was listed as one of Romney’s California “statewide honorary chairmen,” though her role at HP wasn’t part of that announcement. But in April, the Romney campaign cited Whitman’s job as CEO of HP in its list high-profile endorsements in that state.
Whitman was also co-chair of a Romney fundraiser last night, with tickets as high as $50,000 each, the San Francisco Chronicle reported Tuesday.
What kind of political theater might emerge from a Romney-Whitman affiliation takes no imagination. While Romney is campaigning on a platform to create jobs, Whitman just announced plans to cut 27,000 jobs at HP over two years – eight per cent of the company’s workforce.
In a recent interview in the National Review, Romney praised Whitman. “I wish Californians had elected Meg Whitman. She would have been more successful and explained to Californians the need to cut back on spending and eliminate unnecessary programs.”
That interview ran May 17, the same day that reports about HP’s planned cuts were gaining traction. The Huffington Post was quick to make the connection, and wrote that “Whitman’s cost-cutting chops came at a less-than-fortuitous time.”
Romney may think twice about being too closely affiliated with a company that plans to cut 9,000 employees by the close of its fiscal year, Oct. 31, just in time for the Nov. 6 election.
But for HP, the Romney-Whitman connection may create risks ranging from public perception of the company to scrutiny by the government in contracts, said some observers in business, law and public relations.
“There is no upside for an organization to have their CEO to be so prominently supporting one political candidate,” said David Gebler, who is on the International Advisory Board of Suffolk University’s graduate program in Ethics and Public Policy, and an author on this topic, including the book Creating a Culture of Compliance.
Whitman’s campaign involvement is a potential conflict because she stands to gain from it, said Gebler. A Romney election victory may lead to a cabinet post or ambassadorship, he said.
HP doesn’t discourage employees from being involved in politics. But its code of conduct seeks to limit political entanglements by advising employees to “ensure that your individual political views and activities are not viewed as those of HP.”
Asked how HP reconciles Whitman’s active support for Romney with its conduct guidelines, a company spokesman said, in a statement, that: “HP encourages our employees to participate in the affairs of the community. Meg Whitman’s support of Mitt Romney is that of a private individual. HP has not taken a position in the current presidential election, and Ms. Whitman’s support of Romney should not be interpreted as such.”
While most CEOs don’t become active in political campaigns, Michael Robinson, executive vice president of Levick Strategic Communications, believes Whitman gubernatorial campaign creates an exception for her.
When Whitman was appointed as CEO, Romney was already running his campaign. Two weeks prior to the HP board’s decision hire Whitman, the Romney campaign published on its Website an essay by her on U.S. workforce needs.
“It’s not as if her views and affiliations aren’t widely known,” said Robinson, who believes the HP board acted with its eyes open because it wanted someone who was “high profile,” had “star power” and knew their way around.
But David Johnson, CEO of Strategic Vision LLC, a public relations and political consulting firm that has advised GOP candidates, said Whitman could be courting disaster. “She risks alienating board members, making political enemies even more of the Obama administration and Democrats, and holding HP to even greater media attention as the company continues to rebuild,” said Johnson.
A risk is that HP becomes associated in the minds of some people as being pro-Romney, said Johnson. “That’s a big negative,” he said.
Silicon Valley CEOs have played visible, in-public roles in politics before, but those occurrences are rare. In late 2008, Eric Schmidt, as CEO of Google, told the Wall Street Journal of his support for then-Sen. Barack Obama, a Democrat. Schmidt was later asked to help in the presidential transition.
Whitman’s connections with Romney are deep. She worked for eight years at Bain & Co. Romney, a co-founder of Bain, supported Whitman’s gubernatorial run.
Rita Gunther McGrath, an associate professor at Columbia Business School, said she would not be surprised if Whitman gives Romney “a fair amount of personal credit for having helped her achieve so much in her own right.”
“I would imagine the HP board would have asked about that and decided that the relationship was political, certainly, but that it went beyond that,” said McGrath.
McGrath said that considering the personal relationship, she would be “inclined to accept her position of support, rather than be critical of it, bearing in mind the risks.”
That said, McGrath said she would be more concerned about Whitman “getting distracted with election-year politics when digging HP out of the ditch it is in should be job one if she is going to assume the CEO role.”
