Are CEOs Turning Against Trump?

In the days and weeks following U.S. President Donald Trump’s 2024 election win, a perception began to emerge that many CEOs were looking to cash in on the new administration’s stated desires to cut taxes and slash regulations. In private conversations, described in this magazine and elsewhere, business leaders expressed concern about Trump’s pronouncements on tariffs but didn’t expect him to follow through on them.

Two months on, how are CEOs feeling?

Jeffrey Sonnenfeld is a professor at Yale University’s School of Management and runs a regular salon of the country’s top CEOs. He shared with me survey results showing that two-thirds of the U.S. business leaders who spoke with him now felt that the Trump administration would be bad for the economy. I discussed the findings with Sonnenfeld on FP Live this week. Subscribers can watch the full discussion on the video box atop this page. What follows here is a condensed and edited transcript.

Ravi Agrawal: I want to start with how CEOs are feeling about Trump. Beyond the stock market, I think some data could be useful here. So, you ran this meeting at Yale, attended by about 100 top CEOs from companies including J.P. Morgan, Pfizer, Dell, and American Airlines. Of those, 60 percent identified as Republicans, and you surveyed them on many issues. Here are some answers that stuck out to me:

Jeff, this was not how CEOs felt two months ago. What happened?

Jeffrey Sonnenfeld: CEOs were expressing some enthusiasm in January, whether because of relaxation of tax issues or regulatory rollbacks. But very few of them took seriously the enforcement, let alone the expansion and widespread net of tariffs that we’ve seen.

RA: But here’s the thing I don’t get. Trump has been fairly consistent about tariffs. He took out ads on this very issue in the New York Times in the 1980s. Why is it that CEOs have been so reluctant to believe him about them?

JS: Because nobody thought tariffs were going to be driven by tantrums. They thought that it would be strategic. They thought that this would be specific strategic tariffs, not across the board ones. It’s not just the widespread nature of tariffs, but also the head-spinning volatility and uncertainty that is problematic. [Former President Joe] Biden kept tariffs on sensitive chips going to China; there are certain areas where the tariffs made sense. But not the way Trump’s approaching them, imposing tariffs on Colombia just out of vindictiveness and vanity because they didn’t want military transports bringing in immigrants.

RA: One of the other questions you polled to this group of about 100 CEOs asked how much the stock market would need to decline for them to speak out collectively. The S&P 500 index has fallen about 10 percent so far. Nearly half of the group surveyed said it would need to fall by 20 percent for them to speak up. About a fifth of the group said stocks would need to fall by 30 percent before they took a public stand. Is it usual for U.S. CEOs to be this cautious?

JS: Actually, CEOs have been the most courageous voices in American society. The social change in the 1960s and 1970s were led by interfaith clergy linking arms with trade union leaders, campus leaders, and professional associations such as the American Medical Association, the American Bar Association, and others of that sort.

And now they’re all dormant. They’re all silent on the sidelines pointing to these CEOs—who, for the most part, are not the multibillionaire oligarchs. They are very well-paid, but most are just hired hands working at the behest of boards of directors. In 2017, the CEOs are the ones who, after they realized they were being worked for photo ops, walked out en masse from Trump’s business advisory councils. They didn’t come back until now.

That’s never happened in U.S. history—for the commander in chief to issue a call to action for the American business community, for them to walk out and not come back.

RA: But public perception is very different from what you just said. For most people, the image that is seared in their mind is of all of the top CEOs showing up during Trump’s inauguration. Many of them are not oligarchs, you’re right, but they’re incredibly wealthy; they run companies such as Google or Amazon.

JS: Google’s CEO is the only hired-hand CEO in those photo ops. The others are like Jeff Bezos or Elon Musk, multibillionaires and controlling-interest owners. The tech titans. With the exception of Musk, they did not support his candidacy. They all supported [former Democratic candidate and Vice President] Kamala Harris.

There’s nothing wrong with trying to make Trump the most successful president they can, out of patriotism. Once he’s elected president, he’s supposed to be the president of all people, all citizens, all institutions, and they wanted to help him. There’s nothing wrong with going to Mar-a-Lago to meet with him—whether it was for the self-interest of their own business enterprises or to work on larger causes in the interest of the nation’s economy.

But just because Trumpaganda sold the U.S. public on having had a terrible economy under Biden, it doesn’t make it so. You don’t need to placate; you need to educate. That’s what the Democrats failed to do. And similarly, when saying that the business leaders are behind him, the data shows business leadership did not support Trump. Populists on the left and the right who want to take down institutions portraying it differently doesn’t make it so. So it’s important to challenge it with the facts: The CEOs didn’t support him, and he’s rapidly losing their support.

Sitting at the Business Roundtable with Trump in the room, nobody wants to poke the bear. He has such a coercive, chilling effect. They’re afraid of vindictiveness. So, they went silent there.

RA: One other element of these surveys was national security. And 85 percent of them thought that uncertainty in U.S. government was a gift to China. This refers to tariffs, but also Department of Government Efficiency and the efforts to slash the bureaucracy. And separately, 75 percent of the surveyed CEOs believe that there’s a tipping point in the degradation of national security that would push them to act collectively.

It seems that they’re more worried about national security than they are about the stock market. Is that right?

JS: That was a shocker to us, and I’m glad you mentioned that. About 21,000 workers in the Defense Department were driven out [by the administration’s offer of deferred resignation]. By the way, the Defense Department employs considerably fewer people now than it did in 1990.

And you could argue that’s a Cold War impact. But in fact, research shows that the security risk is higher now than it was during the Cold War. We took out our preemptive cyber security protection from Russia, on a unilateral basis, to show good faith. Where’s their good faith? To disparage these FBI guys and possibly drive out a thousand of them and almost a comparable number at the CIA of highly skilled people in technical parts of surveillance and information-gathering, to suspend some of the foreign interference task forces in the Justice Department, to compromise soft power with the U.S. Agency for International Development, to limit Voice of America’s ability to blunt the tyrannical control of autocrats controlling information elsewhere; it’s all very alarming to CEOs. And 85 percent of them say they’re embarrassed with their international business partners.

They’re horrified that we seem to have confused our allies with our adversaries. Nothing critical gets said about China. Special [envoy to the Middle East] Steve Witkoff repeated [Russian President Vladimir] Putin’s talking points on the Tucker Carlson Show. They’re very alarmed about the confusion of which side we’re on.

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RA: CEOs are so powerful. The biggest companies today have market caps that are the size of entire countries’ GDPs. But given the clout that CEOs have, are they not able to exert more pressure on policy?

JS: Not individually. Benjamin Franklin warned us, we shall surely hang separately if we don’t hang together. And that’s why we need collective action. I can give you countless examples: Delta Airlines took a position on the Georgia voting law that was going to be tossing out ballots without any evidence of fraud. The CEO of Coca-Cola also took a position. And they wound up being subject to selective taxation and MAGA boycotts.

So, I called the CEO of American Airlines and United Airlines. They rushed in immediately to provide air cover for Delta. Same thing happened with PepsiCo and other consumer goods companies that came to the defense of Coca-Cola. In less than 24 hours, we got 100 of them to give cover to each other. That’s what they have to do.

CEOs are realizing what the Republican Party hasn’t figured out: They’ll get taken down if they don’t work collectively. They can’t joust with Trump one-on-one. Whether you’re [Secretary of State] Marco Rubio or Chris Christie or Nikki Haley, you either work together or you’re going to get destroyed.

RA: How, as someone who teaches CEOs, do you explain ethics and values when a company operates across so many different cultures and countries? Especially as geopolitics enters a period where war is back and suddenly this idea of a globalist company is really challenged?

What’s the difference between a country’s values or ethics and a company’s values and ethics? How does a CEO respond if the company that you run has employees in countries that are at odds with one another?

JS: When CEOs are operating at their best, there’s a moral universalism that they believe in. “When in Rome” doesn’t work. Don’t necessarily lower to the local standards. Anthropologists and some cynics in the business world would say companies should do what’s legal in that country, but it’s not true.

IBM and especially Coca-Cola led social change. General Motors fought apartheid and had 200 companies pull out, saying, even if it’s legal in South Africa, we’re not going to support apartheid. That was a remarkable statement.

And 1,200 companies pulled out of Russia after the invasion of Ukraine. That shows a transcendent set of morals that isn’t “whatever goes.” Who cares if Russians will accept those moral principles? That isn’t the way U.S. companies operating in Russia want to act. Business leaders are right to take what some may see as paternalistic business practices. IBM has never paid any political donations in this country. They don’t pay Democrats, they don’t pay Republicans.

The CEO of IBM, Arvind Krishna, had a personal meeting with Trump to challenge some national industrial policy statements on technology with some other tech leaders, a week ago Monday. He didn’t need to pay any money to get in to do that. The force of a company and a reputation for integrity is worth a lot more than paying bribes or trying to placate local bigotry.