HP CEO Takes Risk by Helping Romney

When Meg Whitman was appointed CEO of Hewlett-Packard last September, her longtime friendship with Republican presidential candidate Mitt Romney was well known.

Since then, Whitman has played a public role in the Romney campaign. In March, she was listed as one of the campaign's "statewide honorary chairmen" for California. In April, the campaign cited Whitman's job as HP CEO in its list of high-profile endorsements. And last week, Whitman co-chaired a major Romney fundraiser.

It's not hard to imagine the kind of political theater that the Whitney-Romney partnership could inspire, especially in light of the fact that Romney is vowing to create jobs but Whitman last month announced that HP would cut 27,000 positions.

In an interview posted by National Review on May 17, as reports of HP layoffs were spreading, Romney praised Whitman. "I wish Californians had elected Meg Whitman [governor]. She would have been more successful and explained to Californians the need to cut back on spending and eliminate unnecessary programs," he said.

Romney might think twice about being closely affiliated with a company that plans to cut 9,000 employees by Oct. 31, days before the election.

The Romney-Whitman connection also creates risks for HP. Among other things, it could impact public perception of the company or play a role in the degree of scrutiny the company faces when seeking government contracts.

"There is no upside for an organization having their CEO so prominently supporting one political candidate," said David Gebler, an adviser to Suffolk University's graduate Ethics and Public Policy program, and author of the book Creating a Culture of Compliance.

HP doesn't discourage employees from getting involved in politics. But its code of conduct advises workers to "ensure that your individual political views and activities are not viewed as those of HP."

In a statement, an HP spokesman said that "Meg Whitman's support of Mitt Romney is that of a private individual. HP has not taken a position in the current presidential election."

While most CEOs don't become active in political campaigns, Michael Robinson, executive vice president of Levick Strategic Communications, said Whitman's gubernatorial campaign created an exception to the rule. "It's not as if her views and affiliations aren't widely known," he said.

The HP board acted with its eyes open in hiring Whitman, said Robinson, noting that board members wanted a "high-profile" CEO with "star power."

David Johnson, CEO of Strategic Vision, a public relations and political consulting firm, 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.

Silicon Valley CEOs have at times played visible roles in politics. In late 2008, Google's then-CEO, Eric Schmidt, publicly supported Barack Obama in the presidential campaign.

Whitman's links to Romney are deep. She worked at Romney's Bain & Co. for eight years.

Rita Gunther McGrath, an associate professor at Columbia Business School, said that considering the length of Whitman and Romney's relationship, she's "inclined to accept [Whitman's] position... bearing in mind the risks." That said, McGrath added she might be concerned about Whitman "getting distracted with election-year politics when digging HP out of the ditch."

This version of this story was originally published in Computerworld's print edition. It was adapted from an article that appeared earlier on Computerworld.com.

Copyright © 2012 IDG Communications, Inc.

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