The movement by tech employees to challenge their own executives has been building from a more general protest ethos in the Trump era. Shortly after President Donald Trump came into office and implemented his controversial travel ban, many Silicon Valley workers, including Google workers, joined mass protests. A broad coalition of tech companies, including Apple, Facebook, Google, Microsoft and Tesla — 130 tech companies in all — not only voiced opposition to the travel ban in public statements but filed a legal brief in the U.S. Court of Appeals supporting opposition to it.
Jeffrey Sonnenfeld, senior associate dean for executive programs at Yale School of Management and founder and president of The Yale Chief Executive Leadership Institute, said Google executives made the right decision with Project Maven. He doesn't view CEOs who cede to an employee protest as having forfeited their leadership status, even if it seems counterintuitive. Sonnenfeld said the model at the top is changing quickly, and CEOs who listen and abide by employees' complaints are being seen as stronger leaders.
He pointed to a recent milestone moment when CEOs rebelled against the highest leadership office. “August 2017 was the first time in the nation’s history that CEOs have declined the call of service from the Commander in Chief,” Sonnenfeld said, referring to a cascade of CEO resignations from a business advisory council to Trump that followed the president’s remarks on neo-Nazis and white supremacists. “How can they stand as a leader if they don’t stand behind the values they profess?" And that same privilege should cascade down the firm. "These employees are not slaves, and they’re not soldiers,” he said.
A Harris Poll Reputation Quotient released this week revealed an increase in the percentage of Americans who hold a positive view of CEOs. Nearly one-third of Americans, 32 percent, say today’s CEOs have a “very good reputation,” up from 25 percent last year, according to the poll. In addition, Americans who believe that CEOs have a “very bad reputation" dropped from 50 percent in 2017 to 43 percent this year. Researchers concluded that company and executive reputation is newly “built around ideals, a new moral authority — equal parts capitalist and activist.”
The government contracts in question have so far been inconsequential to these cash-rich growing companies’ balance sheet. For example, Google’s contract with the military for Project Maven was reportedly only a sliver of its $110 billion in annual revenue — $9 million. Until there is much more shareholder money at stake, a decision like Google's won't be difficult to make on financial grounds.
"We maintain an ongoing dialogue both within our company and with outside stakeholders about how best to act," a Microsoft spokesman said.
According to Sonnenfeld, it has never been only about money for Silicon Valley companies, and shareholders need to adapt to the new environment — or invest elsewhere.
“Anybody who invested in these companies who harbored the misconception that these companies will do anything for money should quickly sell their stock and buy into a tobacco company," he said. "That’s not what these companies stood for from the beginning. They stood for values beyond the quickest short-term buck that can be made.”