Dear Leaders,

In 1915, Henry Ford was having a pretty good year.

The moving assembly line had reduced the time required to build a Model T from twelve and a half hours to ninety-three minutes. Ford Motor Company would produce more than half a million Model Ts during the 1915–16 model year. Ford had taken one of the most complicated manufactured products ordinary Americans could buy and figured out how to make it faster, cheaper, and at enormous scale.

So, naturally, he decided to end World War I next.

He chartered a Scandinavian ocean liner called the Oscar II, filled it with more than one hundred peace activists, intellectuals and reporters, and sailed for Europe in December 1915. His theory was that a delegation of prominent private citizens could persuade the warring governments to negotiate. It didn't go well.

The delegates started fighting with one another. Influenza spread through the ship. The press mocked the expedition. Ford eventually abandoned the mission and came home. The war, apparently unaware that the world's greatest automobile manufacturer had arrived to straighten things out, continued for another three years.

There is a useful lesson here for modern CEOs: success produces a peculiar occupational hazard, jurisdictional delusion.

Once you become exceptionally good at running a company, people start asking what you think about everything: politics, race, immigration, climate, gender, war. The invitations come from everywhere: employees, customers, journalists, and your communications department. After a while it becomes easy to confuse the existence of a microphone with the existence of expertise. Yes, we also see this at the Oscars every year.

The exposure was manageable when a CEO's opinion was limited to that day's newspaper. Since then we have built an extraordinary machine for converting every corporate decision into a referendum on civilization. A beer promotion becomes a national argument about gender. A Pride display becomes a political campaign. A restaurant changes its logo and somehow the president of the United States gets involved.

This is now part of running a company. So how do you do it?

First, let's see what's changed: For most of modern capitalism, companies operated mainly in the market for products. Today many also operate, willingly or unwillingly, in the market for identity. Different times and a different business.

Ronald Coase famously asked why companies exist at all. His answer, roughly speaking, was transaction costs: sometimes coordinating economic activity inside an organization is cheaper than contracting for everything in the open market. The corporation was not invented to give people meaning, arbitrate social morality, resolve political disputes, affirm personal identities, cure loneliness, conduct foreign policy or tell employees which side of history they are standing on.

Yet many companies have acquired all of it. The modern corporation increasingly wants to be employer, merchant, university, social club, therapist, political action committee and church. Then we act surprised when the congregation starts arguing about doctrine.

This now comes up in almost every conversation I have with chief executives, and below are the takeaways from our conversations on how to run your company in these times of unforgiving culture wars:

Cracker Barrel sells pancakes, biscuits and chicken-fried steak. Except it doesn't. It sells an imagined America: rocking chairs, wooden peg games, antiques on the wall, Uncle Herschel leaning against a barrel, and a version of the rural South preserved beside an interstate exit. You can make fun of that if you want, and plenty of people do, but customers are paying for familiarity, not historical accuracy.

In August 2025, Cracker Barrel unveiled a simplified logo that removed Uncle Herschel and the barrel, part of a broader modernization of its restaurants. The reaction was immediate and intense enough that the company had to reverse the change within about a week. Restaurant traffic deteriorated anyway, the modern store remodels were abandoned, and the controversy was still weighing on sales months later. CEO Julie Masino stepped down a few weeks ago.

Was the logo objectively worse? Who cares. The question is what customers thought they had been purchasing all those years. Management thought they owned a restaurant chain with an outdated visual identity. Customers thought they jointly owned a memory.

This is one of the easiest mistakes sophisticated executives make: underestimating symbolic assets. As opposed to equipment or other physical assets that depreciate on schedule, a brand can appreciate for fifty years precisely because it's untouched.

That matters most for companies whose appeal contains nostalgia, tradition, heritage, locality, patriotism, rebellion or exclusivity. A Harley-Davidson customer isn't buying transportation. A Patagonia customer isn't buying nylon. A Yankees fan isn't purchasing nine men standing on grass. Every enduring brand eventually acquires meaning beyond the product, and that meaning can be enormously valuable.

The internet has destroyed our ability to tell the difference between a lot of people being mildly annoyed and a small number of people being absolutely furious.

Mancur Olson spent much of his career explaining why small groups with concentrated interests overpower much larger groups whose interests are diffuse. Ten thousand people willing to spend every waking hour fighting you matter more than ten million who vaguely disagree with you but have dinner reservations.

Social media lowered the cost of organizing to approximately zero. One activist with an X account can identify an offense Monday morning, assemble a coalition Monday afternoon, contact journalists Monday evening, produce a boycott hashtag by midnight and have your chief communications officer issuing a statement by Tuesday morning. The result is an optical illusion in which executives see intensity and infer incidence.

The relevant unit of analysis must be behavior, not tweets. Did customers stop buying, did employees resign, did applicants dry up, did distributors object, did investors change their assessment of future cash flows? If not, you may simply be experiencing noise.

The opposite mistake is harder to catch. Executives dismiss a backlash as "just social media" when social media is organizing a change in purchasing behavior.

Take Bud Light. What began in 2023 as a single sponsored Instagram post with transgender influencer Dylan Mulvaney became a national political controversy. Whatever one thinks of the underlying issue, the economically interesting part came afterward: Modelo took the top spot within months, ending a run Bud Light had held for over two decades. Two years later Anheuser-Busch, owner of Bud Light, managed to get the crown back – but with Michelob Ultra, a brand it also owns, which passed Bud Light by volume in the fall of 2025 while Bud Light kept sliding. The parent company survived, its portfolio adapted, and consumers switched. Capitalism is good like that.

Brands are less forgiving.

Albert Hirschman described the basic choices available to dissatisfied members of an organization as exit and voice. The internet fused them: voice now organizes exit.

People say companies should stay out of politics. Fine advice, except politics doesn't always stay out of companies. Employment law is political. Immigration affects your labor supply. Wars disrupt your supply chains. Some issues come knocking at your doorstep whether you want them or not.

The trouble starts with the ones you go out and borrow.

Not too long ago, corporate America decided every company needed an opinion on every major news event. Employees waited for the CEO email. Competitors issued statements, so you felt obligated to issue one too. Soon, silence was interpreted as speech, and speech was interpreted as insufficient speech.

Then you discover the problem with joining a crusade whose terms you don't control. Today it's a statement, next week activists want to make procurement decisions, then divestment, and finally, your silence on the next issue becomes proof that your conviction about the last one was entirely selective.

Congratulations. Your mattress company now has a foreign policy.

Ask yourself two questions before you say anything. Does this materially affect our business? And do we know something about it that nobody else does? If the answer is no to both, you're renting someone else's conviction. And it has nothing to do with courage.

Borrowed convictions are the ones you drop when the wind changes. So if you're going to take a stance, actually own it.

Costco owned it. While the rest of corporate America dismantled their diversity programs, Costco held firm. In January 2025, more than 98% of their shareholders voted down a proposal to review the risks of keeping those programs. Plenty of people hated the policy, but nobody had to guess where the company stood.

Target went the other way. After spending years making DEI commitments a core part of its corporate identity, they rolled them back the minute the political winds shifted. It didn't buy them peace. Foot traffic fell for eight straight weeks, quarterly sales missed by nearly half a billion dollars, and Brian Cornell was out after eleven years. The irony is that Target had been boycotted before, in 2023, from the opposite direction over a Pride collection. Foot traffic went up that time.

Which brings us to the ultimate rule of navigating the culture war: a company can survive being hated. It can't survive being distrusted.

One of the great organizational absurdities of the modern corporation is that a decision carrying $10 million of financial risk may require six committees, while a social-media post capable of creating a national political controversy may be approved by three people during brunch.

Anything involving race, religion, sex, gender, national identity, war or partisan politics should be treated as an enterprise-risk decision, not merely a marketing decision. This doesn't mean the CEO approves every Instagram post. It simply means the organization recognizes asymmetric downside, and that somewhere in the approval chain is the only test that matters: would the CEO personally defend this on CNBC tomorrow morning? If not, don't post it tonight.

This principle works in both directions politically. A conservative CEO deciding that customers would love an anti-DEI campaign creates exactly the same problem as a progressive marketing department launching an activist one. The issue isn't left or right. It is organizational authority. Companies spend enormous energy deciding who can sign a $5 million contract, and almost none deciding who can alter the company's political identity.

Timur Kuran spent his career studying preference falsification. His research shows exactly why regimes look completely stable right up until the week they collapse: people routinely state preferences they don't actually hold because it's safer, and everyone downstream treats those fake statements as real data.

Same thing here, because agreeing with you is free and disagreeing with you isn't.

I routinely observe bosses walking around openly sharing their political and cultural opinions. Since these are emotionally charged topics, bosses aren't doing it without passion. And the conversation is entirely unfair, because you have power and authority. Anyone with half a sense knows it takes very little for these conversations to get derailed, even if you don't intend to.

And whether you accept it or not, when people disagree with us on these matters, we do view them differently. Which, in this case, can clearly affect their career trajectory and upside.

So they do the rational thing and start hedging themselves. They stop being fully honest with you. One of the most fragile and valuable assets of a CEO is access to accurate information. Once your people learn that disagreement is costly, that lack of candor inevitably spills into other areas. If they can't tell you what they really think about the news, they aren't going to tell you the whole truth about a failing product line or a bad acquisition.

Vanessa Burbano at Columbia researched this. Her work shows that when employers communicate a political stance, the people who disagree become measurably demotivated, and the people who agree give you absolutely nothing extra. Measurable downside, zero upside. Never worth it.

And you don't get to complain about not being able to be your "authentic self" at the office. The tradeoff is you hold power, and that comes with immense responsibility.

The customer may not always be right, but the customer is always allowed to leave. Employees can be trained, suppliers can be negotiated with, executives can be coached. Customers cannot be placed on performance improvement plans.

Yet corporate responses to controversy frequently sound suspiciously like management correcting a troublesome employee. You misunderstood our intentions. The campaign was taken out of context. Our values have not changed. We remain committed to having important conversations. Nobody cares.

The easier it is for a customer to switch away from your product, the less your intentions matter. If millions of customers interpreted your decision differently from the way management intended it, you have a communications problem even if the customers' interpretation is unreasonable. Intent is an internal variable; perception is the market price.

No CEO would explain to customers that they are wrong about a price. If they think your $40 widget is worth $20, you have invented a $20 widget. Brands work the same way. Management does not unilaterally determine meaning; the market does.

Sometimes management should tell critics, politely, to pound sand. But make the decision consciously. The worst available posture is moral superiority combined with commercial panic: first lecturing customers, then reversing yourself when sales fall. Now you look arrogant and weak.

Pick one.

A company in a controversy usually has two legitimate choices. If management concludes the original decision was wrong, reverse it quickly and plainly. "We got this wrong. We're changing it back." No essay, no discussion of your journey, no statements explaining your values, no committee to study what happened. Fix it. If management concludes the original decision was right, defend it. Explain why once, then back to work.

Costco essentially chose the second strategy. Cracker Barrel ultimately chose the first. The middle is no man's land, where you keep modifying the explanation because you're trying to satisfy mutually incompatible audiences. You can't.

Culture-war factions don't want compromise, they want evidence of victory. If one group wants the statue standing and another wants it removed, moving it six feet to the left won't produce national reconciliation.

James Madison did not believe factions could be eliminated. His solution was institutional design. Companies need some of that thinking now. You can't prevent political disagreement among tens of thousands of employees and millions of customers. You can, though, decide how the organization processes it.

Every company should have what amounts to a small unwritten constitution governing public controversy. What subjects does the company speak about? Who has authority to decide? Which of these are employee questions and which are customer questions? When does the board become involved? When does the CEO speak personally rather than institutionally? What is the threshold for reversing a decision? Which customers are we willing to lose?

Those questions sound unpleasant. Good. Governance exists because unpleasant things eventually happen, and the worst time to develop principles is three hours after you start trending on X.

A chief executive regularly needs to make decisions that offend people. But there is a profound difference between accepting controversy in pursuit of the company's purpose and manufacturing controversy because management has confused corporate leadership with cultural leadership.

A corporation is one of civilization's great cooperation technologies. People who disagree about abortion, immigration, guns, religion, climate change and almost everything else can nevertheless design semiconductors together, fly airplanes together, stock grocery shelves together and buy the same brand of toothpaste.

Neutrality isn't the goal. It's sometimes impossible and occasionally cowardly. What you're after is legibility: customers should know what the company is, employees should know what it expects, and investors should understand what risks management is taking. If political positions are part of the brand, own them. If they aren't, stop importing them.

Henry Ford changed the world by figuring out how to build a car in ninety minutes. He became a punchline by assuming that made him qualified to negotiate global peace.

Don't get on the boat.

Onward,

Hamza