While there is nothing intrinsically wrong with singing ‘We’re in the Money’ – or, to give it its proper name, ‘The Gold Diggers’ Song’ – it is best to pick your moment.
And, as Sainsbury’s CEO Mike Coupe is now keenly aware, that moment is not when you are miked up and waiting for a television news interview about your supermarket’s upcoming merger with rival Asda.
Coupe has duly apologised – explaining he was merely trying to compose himself and regretting his “unfortunate choice of song” – and of course, he is by no means the first company CEO to make this sort of gaffe. Nor, as Tesla’s Elon Musk has already proved, will he be the last. Here, The Value Perspective highlights five other notable instances of company bosses saying – if not singing – the wrong thing.
In April 1991, the then chief executive of British jewellery giant Ratners set the, er, gold standard for corporate gaffes when, in an after-dinner speech, he made derogatory remarks about the quality of the company’s wares – and saw the value of its shares plummet by some £500m. Within 18 months Ratner had left the business and, in September 1993, its name was changed to Signet Group.
The controversial former CEO of US fashion chain Abercrombie & Fitch made no secret of how he only wanted thin, attractive people in his stores, famously saying in one 2006 interview: “A lot of people don’t belong [in our clothes], and they can’t belong. Are we exclusionary? Absolutely.” In 2013, as the company went through a very tough patch, his comments resurfaced and, a year later, he retired.
“When the music stops, in terms of liquidity, things will be complicated,” the ex-Citigroup CEO told the Financial Times in 2007, as he discussed his bank’s highly leveraged position. “But as long as the music is playing, you’ve got to get up and dance. We’re still dancing.” In 2010, Prince had to explain to a US congressional panel why he had been quite so bullish the year before the global financial crisis struck.
In the weeks after the Deepwater Horizon oil spill in April 2010, the former BP chief exec made a whole series of gaffes, including: “The Gulf of Mexico is a very big ocean”; “The environmental impact of this disaster is likely to be very, very modest”; and, after one of many apologies, “There’s no one who wants this over more than I do. I would like my life back.” In October, as he left BP, he got his wish.
When we started putting this list together, Musk’s inclusion was only going to be on the strength of his already-infamous April Fool’s Day tweet earlier this year that Tesla was going bankrupt – a bold jest when your company is burning through cash at what Bloomberg has calculated to be a rate of some $7,430 (£5,480) a minute.
In recent days, however, Musk has cut off Wall Street analysts during a conference call on Tesla’s earnings with the line “Boring, bonehead questions are not cool” and embarked on a Twitter spat with Warren Buffett that ended with him promising he was “super, super serious” about setting up a candy company from scratch to take on See’s Candies, which is owned by Buffett’s Berkshire Hathaway investment vehicle.
Unlike the others in our list, at least Musk still has his job but, even so, all five of our examples illustrate why, here on The Value Perspective, we are wary of putting too much faith in individual CEOs.
Those investors who do believe one person can take a business forward to greater glories are sometimes vindicated but, more often, they can discover how inappropriate it can be to be humming ‘We’re in the Money’.